While I have no strong feelings one way or the other about the bonuses paid to AIG employees — a drop in the bucket compared to the larger crime of the government bailing out AIG and other firms in general (not to mention every other thing government pays for) — I was pleased to see that esteemed law professor Richard Epstein, in a Wall Street Journal editorial this week, shared my fear that the government just keeps getting more and more comfortable with what once would have been considered bills of attainder, those unconstitutional (yet now rampant) cases where laws are fashioned to punish specific individuals on a “make it up as we go along” basis instead of as broad, general rules applying to all citizens and all cases (the basic idea behind the phrase “general welfare,” though no one remembers that anymore either, of course).
If the law’s so bendy it gets refashioned anew with every discovery of a reviled exec (or kid who falls down a well, or one-in-a-million garden tool mishap, or freak storm), we may as well give up on law and have the current crop of potentates rule by arbitrary decree, in keeping with the swinging mood of the crowd.
All the same, nice to see John Carney likening the wasteful AIG folks to the Joker setting a big pile of money on fire in Dark Knight. This sort of thing will make the populist revolt against both government and its big-business cronies that much easier. The time is fast approaching, I think.
2 comments:
John Carney makes the banks that bought the CDSs
into villains. In fact, AIG appeared quite solvent when
contracts were written. It was the blind spots in the
S&P credit ratings rules as an AAA-rated company that
allowed AIG to dig such a deep hole in the first place. My
nose also detects a whiff of nativism at the end.
Holding out the hope of making good on troubled assets
will delay their liquidation, of course.
Yanking away bonuses at the last second is something
Lucy might do.
Setting Federal Reserve Notes on fire is a great way to demonstrate that they are merely pieces of paper that represent a loan (you’re then lender) backed by the “full faith and credit” of an entity that already owes about 400% as much as it makes annually. That’s as measured in units that _it defines_. And that does not, in fact, count any of these “Federal Reserve Notes”. Which don’t pay any interest.
One would expect that the linen content of the paper makes them sub-par as fire starters, however, unless the chemicals in the dyes somehow make them more flammable.
In a bankruptcy it’s always difficult to retain the most productive workers long enough to effect an orderly liquidation, or turn the business around. Smart receivers pre-negotiate employment contracts in order to ensure that the lights stay on as long as necessary. Obviously this is yet another example in which we can confidently say that the U.S. Government doesn’t have a fucking clue.
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