Town Hall Meeting

16 Mar 2009

The Sanctity of [Some] Contracts

Filed under: — Al @ 1:59 pm

This article is in reference to the $450 million in bonuses going to AIG executives and other employees even though the US govt owns 80% of the company.

Published on Monday, March 16, 2009 by Salon.com
The Sanctity of AIG’s Contracts
by Glenn Greenwald

Larry Summers, March 15, 2009, on AIG’s payment of executive bonuses:

We are a country of law. There are contracts. The government cannot just abrogate contracts. Every legal step possible to limit those bonuses is being taken by Secretary Geithner and by the Federal Reserve system.

Associated Press, February 18, 2009:

The United Auto Workers’ deal with Detroit’s three automakers limits overtime, changes work rules, cuts lump-sum cash bonuses and gets rid of cost-of-living pay raises to help reduce the companies’ labor costs, people briefed on the agreement said today. The UAW announced Tuesday that it reached the tentative agreement with General Motors Corp., Chrysler LLC and Ford Motor Co. over contract concessions, as GM and Chrysler sent plans to the Treasury Department asking for a total of $39 billion in government financing to help them survive. CONCESSIONS WITH THE UNION ARE A CONDITION OF THE $17.4 BILLION IN GOVERNMENT LOANS that the automakers have received so far.

Apparently, the supreme sanctity of employment contracts applies only to some types of employees but not others….

http://www.commondreams.org/view/2009/03/16-6

Good job Larry Summers appointed by Obama. Looks like campaign contributions to Obama by Wall Street, Investment Banks, and Hedge Funds was money well spent. Did you know that former investment banker and current white house chief of staff Rahm Emanuel was the “top House recipient in the 2008 election cycle of contributions from hedge funds, private equity firms and the larger securities/investment industry?” If we don’t keep their feet to the fire, these jerks will keep getting away with applying one rule to the rich and well connected, and another rule to the rest of us!

http://www.opensecrets.org/news/2008/11/obamas-pick-for-chief-of-staff.html

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