AIG and the Undeserving Rich

Charles Blow, the "moderate" who seems to write a lot of words but never takes a clear stand on anything, recently lamented on the op-ed page of the New York Times about what a small matter the $165 million in bonuses really were compared to the $170 billion AIG received in government welfare. Sheryl Gay Stolberg followed with a chirpy op-ed in the "Week in Review" where she quoted Ed Gillespie, Bush's former uber-handler, implying the whole dust up is just a "distraction." The knaves over at CNBC trumpet the Wall Street party line with the same level of discipline and enthusiasm that Maoists showed during the Cultural Revolution. But the sages of the mainstream media are totally bought in. And they're wrong because they're totally bought in. And here's why they're wrong:

1) The $165 million in bonuses are assumed to have been handed out in a good faith effort to hold on to talent or reward those who are "winding down" the books in the "financial products unit." But the whiff in the air is the distinct odor that these bonuses were not handed out "in good faith" for services provided but just another round in the epic rip-off of tax dollars that we've seen from all the other banks that received taxpayer money. Millions of Americans do not believe AIG doled out these bonuses "in good faith," nor do they believe the banks are acting as honest "stewards" of the public's money.

2) AIG's CEO, Edward Liddy, told Congress and New York Attorney General Andrew Cuomo that he couldn't divulge the names of the executives who received the bonuses because they've had death threats. I don't believe this line. More likely AIG refused to release the names because those who pocketed the cash are already fabulously wealthy and the idea of Uncle Sam augmenting their private fortunes would rub most people the wrong way. If average folks could see how rich these people are they would be appalled that they collected one penny's worth of our taxes. Besides, if they're getting death threats they can afford to pay to hire some "security." There are plenty of former Blackwater (or "Xe") employees looking for work and many security guards and laid-off police officers and prison guards and Iraq and Afghanistan war veterans seeking employment right now who would love to be hired for the cushy job of protecting some Wall Street fat cat while he waits for his limousine to whisk him to another ski trip in Vail. These plutocrats could help stimulate the economy by using their taxpayer handouts to hire unemployed veterans instead of buying jewelry and baubles for their wives, mistresses, and "escorts."

3) The $165 million give-away to Wall Street high rollers has been done in a context of austerity for working middle-class people. Long before the current economic meltdown we've been told that the United States of America just does not have the resources to pay for health care for all of its citizens and that education must be cut and social programs eliminated, etc. because "we just don't have the money." Yet all the while Congress after Congress lavished blank checks for the Pentagon and billions of dollars in corporate welfare. The sky's the limit when we're funneling money into the war machine or throwing it at bloated Wall Streeters. It's not "trivial" or a "distraction" when there has been so many needs in this society that have gone unmet, neglected, or ignored. Why anyone would trivialize $165 million of public funds going into rich guys' pockets is anybody's guess.

4) And when did $165 million become a real yawner for the fiscal hawks? That kind of money could build and staff at least a dozen state-of-the-art medical clinics; or refurbish schools and hospitals; or pave roads, or go to research to cure diseases, and so on. That $165 million would have been spent better in almost any other pursuit than forking it over to the undeserving rich.

Beginning in the earliest days of the Reagan administration, the "greed is good" ethic came to dominate our culture, and continues to rule our political discourse. We still live in an era where Gordon Gekko, a fictional character from Oliver Stone's 1987 movie Wall Street, gives us more truth about what is really going on than all of the yakking heads on CNBC and the blathering on the editorial pages of Businessweek and the Wall Street Journal. Said Mr. Gekko:

The richest one percent of this country owns half our country's wealth. One third of that comes from hard work, two thirds comes from inheritance, interest on interest accumulating to widows and idiot sons and what I do, stock and real estate speculation. It's bullshit. You got ninety percent of the American public out there with little or no net worth. I create nothing. I own.

It is notable that according to the American Film Institute's list of the top fifty movie villains, Gordon Gekko, a Wall Street trader, ranks 26th, ten places above the sadistic murderer, Frank Booth, in David Lynch's 1986 movie, Blue Velvet, a kinky killer who inhaled amyl nitrate through a plastic oxygen mask while he cut people to pieces.

The existing climate of righteous taxpayer fury is why CNBC's Rick Santelli's play-acting of an angry "average guy" didn't hold water and why The Daily Show's Jon Stewart's take-down of CNBC's Jim Cramer was such a sensation. The business elites in this country, no matter how hard they try, cannot create a fictional "Joe the Plumber"-type character to fool working people. "Joe the Derivatives Trader" just doesn't cut it. The current crisis was a long time coming. For years unbridled capitalism has beat down and bloodied the working middle class in this country. It's not surprising that in this perilous time those chickens are now coming home to roost.

Comments

[Kungfublood]

Some true words from Kung Fu here:
When you can't avoid a confrontation by neutralization,
Knock them down let them git up by themselves maybe you can be friends & if they try to pull something dirty on you knock them down again bust them up and never let them up again.

[KillTheMessenger]

I believe that pretty much anything but the first part of Kung Fu's advice will lead to a permanent criminal record and maybe some serious jail time.

:-)

[GreatNews27]

And no one is going to change any of it. AIG is now making policies that they cannot honor. Who gets to pay when their clients need to collect on that policy? Why, you and me of course. This fiasco just keeps getting worse and worse. Obama is a fool not to either shut them down or nationalize them. He will have to do one eventually. Otherwise, AIG will such every last dollar out of ALL our pockets and come back for more. They know a nation of suckers when they see one.

[DanBest]

I don't think that it is a coincidence that the rich have become more powerful as their tax rates were cut from a high of 90 percent down to 30 percent today. The GOP had a new, energized donor base, but we got what amounts to an oligarchy. Private media have no interest in afflicting the comfortable. The lower and middle class exist only as cannon fodder for reality freak shows. And even here where a lot of lefties post, rarely does anyone say what is obvious: we have a massive liability. We are all asked to sacrifice. The rich must sacrifice more by paying more in taxes. It's that simple. Put them back into the box that kept their most plutocratic impulses in check. All the extra liquidity given to our richest citizens has locked us back into the guilded age where we go from boom to bust. Their freedom to keep most of their fortunes translates into less for everyone else and an urge to crash the system so that they can buy low. They can afford the boom bust system: the rest of us can't.

[Joseph A. Palermo - Huffpost Blogger]

Good point Danbest, things really moved for 30 years in the wrong direction, toward a worship of all things corporate -- deregulating the financial services sector didn't make sense in 1987 when the Savings and Loan collapse hurt millions of people, and didn't make sense since -- but Wall Street threw around so much campaign cash it got what it wanted and now we all suffer the consequences.

[schatsie]

I agree with each of your points...Yesterday after watching Spitzer being interviewed by zakaria, I happened to catch a bio on Jonny Depp... There was a quote there, that I am sure you will love.

You can always trust a dishonest man to be dishonest....it rang so true today...

Thanks for your articles, I have loved all of them. and they are still timely. I hoped you enjoyed Jon Stewarts recent shows on the Media and Wall Street...

[Joseph A. Palermo - Huffpost Blogger]

Thanks schatsie! Keep on commentin'!

[Sundialsvc4]

Michael Douglas did such a terrific job on that movie ... the only trouble with the character of Gordon Gekko (not with the way Michael played him) was that he made WAY too much sense.

Sit back and watch the fireworks, Joseph, because it's about to be revealed that these people are going to be bailed-out at taxpayer expense, to the utter ruination of the financial condition of the US Treasury, at pure profit to the companies involved, and with no change to the law and not even the suggestion(!) that any sort of crime has been committed.

[Joseph A. Palermo - Huffpost Blogger]

Yep

[johnie2xs]

Well, after watching him on GPS, this weekend, Fareed Zakaria's show on CNN, I think it is time to bring Elliot Spitzer back, to finish off what he started.
http://www.cnn.com/video/#/video/us/2009/03/22/fz.gps.spitzer.speaks.out.cnn?iref=videosearch

Wall Street put a very effective contract out on him; now's the time to even things up. Read this; http://www.gregpalast.com/elliot-spitzer-gets-nailed/

Along with him, let's bring back John Edwards, David Iglesias (From fired AG fame), and Gary Hart.
Boy! Could you just hear the Rethuglicans scream then?

I'D EFFIN' LOVE IT !!!!!!!!!!­!!!!!!!!!!­!!!!!!!!!!

[WorkingClass]

I like the way you think.

[Joseph A. Palermo - Huffpost Blogger]

I'll never forget the glee on Mukasey's face when he announced Spitzer's prostitute thing -- they hated him on Wall Street, luckily it looks like Andrew Cuomo might be getting tough on them too because he has gubernatorial ambitions -- Patterson has been a dismal failure of a governor -- I'd like to see Cuomo in there.

[johnie2xs]

You know Joey? You know what I think we should do? How about a mass resurrection?

Now what do I mean by that, you may be asking yourself?

Well, after watching him on GPS, this weekend, Fareed Zakaria's show on CNN, I think it is time to bring Elliot Spitzer back, to finish off what he started.
http://www.cnn.com/video/#/video/us/2009/03/22/fz.gps.spitzer.speaks.out.cnn?iref=videosearch

Wall Street put a very effective contract out on him; now's the time to even things up. Read this; http://www.gregpalast.com/elliot-spitzer-gets-nailed/

Along with him, let's bring back John Edwards, David Iglesias (From fired AG fame), and Gary Hart.
Boy! Could you just hear the Rethuglicans scream then?

I'D EFFIN' LOVE IT !!!!!!!!!!­!!!!!!!!!!­!!!!!!!!!!

[schatsie]

I agree 100%...Think about Jeff Gannon, a gay prostitute who was in the White House over 200 times, that is 188 times more than Monica and NOBODY CARED ABOUT THAT.....

[Joseph A. Palermo - Huffpost Blogger]

Thanks for the comments -- the outrage at the behavior of the big banks throwing around taxpayer money can be directly related to the rise in income and wealth inequality over the past 30 years -- the vast majority have been asked to do without while a tiny minority has reaped all of the benefits from economic growth since the Reagan administration -- deregulation and cutting social spending brought us to this catastrophe and the sooner the business elites in this country figure it out the better -- soon Geithner and Summers will be history and some real reformers will be in place, mark my words, the country has no choice -- Wall Street needs to be brought under control -- the plutocracy cannot continue in its old form -- too many people have been wiped out for that and too much taxpayer money is being wasted.

[WorkingClass]

Amen Joseph. Amen.

[Paul Christopherson]

The stock market economy that America is trapped in is now perfectly corrupt. Some very big people at the top have arranged things so they will get bigger and bigger. The way this all gets financed is other people have to take a very big hit. Investors and taxpayers and employees are the saps at the table. There can be no more vivid illustration of this than the China Syndrome called AIG, in which we see a direct transfer of wealth from the public to the people that made the mess, to be distributed at their sole discretion.
No more money should be spent to benefit the creators, enablers, and participants of this ghastly mess, no more sacrifices made on their behalf, no more of their lies listened to. A dangerous broad-based resistance may already be forming. Maybe not citizens throwing bricks down the street yet, or setting parked cars on fire, but something not far removed. Perhaps a taxpayer revolt, peaceful to start, organized by perfectly respectable citizens, just saying they have had enough. So far, bailouts have been explained by claiming that not doing them would have brought the economic house down. Some skepticism about those claims might crop up, since there was never much justification for them. Let something like that get started, and there are real problems.

[lgillooly]

Mr Palermo,
The bottom line is the RNC is the political arm of corporate America. They also control the message.Until we break up the talk radio monopoly Americans will continue to believe the RNC
Supports the troops
are fiscally consevative
the pro life partry......after 30 yrs. they got "ABSTINENCE ONLY". Why aren't average voters furious with that joke of a policy? Rush and the boys convince them not to.
The best lie is the media is liberally biased..I would be happy if it was close to balanced.
The DNC has to focus on getting the truth out to average citizens. If 50 million people listen to right wing radio a day...we will never get the truth out