90% tax on US AIG bonuses

[Sankari]

As it's part of their contracts and you can't do anything about it.
Loads of jealous people in this thread.

Projection much?

This has nothing to do with jealousy. I used to invest in shares, and as a shareholder I expected the company to ensure that I would receive a decent return for my investment. I didn't give them my money so they could just ***** it up the wall by forking out wads of cash to incompetent managers whose performance had done nothing to justify it.

When the company fared badly, my shares fared badly; when the company fared well, my shares fared well. Nothing wrong with that.

But when a company does not fare well yet still feels justified in using the shareholders' money to line the pockets of the very people who have devalued the shareholder's investment... well then, the shareholders have every right to complain, and the management should be held accountable for their actions.

Or is it right to tear contracts up and change the laws to specifically **** over people as long as it's not you and you think they are well paid. It's total rubbish.

I am not suggesting this at all. If you check my contribution to other threads on this subject, you'll find that I am strongly opposed to any government interference in private sector pay rises and bonuses.

 

[Glaucus]

But when a company does not fare well yet still feels justified in using the shareholders' money to line the pockets of the very people who have devalued the shareholder's investment... well then, the shareholders have every right to complain, and the management should be held accountable for their actions.
.

Yes you have the right to complain, but you don't have the right to tear their contracts up. The company gave these people the contracts. If they could prove they purposley screwed up then they could sack them. they can't so untill they change their contracts, they are entitled to what their contracts say.

 

[Raumarik]

The instant you start tearing up or altering peoples contracts you start to attack democracy, who's to say the paper the laws of the land are written on aren't next? Don't like something? Just ignore it, doesn't matter if it's legal or not. What they're doing is downright dangerous.

 

[Energize]

The instant you start tearing up or altering peoples contracts you start to attack democracy, who's to say the paper the laws of the land are written on aren't next? Don't like something? Just ignore it, doesn't matter if it's legal or not. What they're doing is downright dangerous.

That's a bit extreme, there are already laws against "unfair contract terms", which can void contracts if the government doesn't like them. Contracts aren't the same as laws.

 

[Glaucus]

That's a bit extreme, there are already laws against "unfair contract terms", which can void contracts if the government doesn't like them. Contracts aren't the same as laws.

Which is vastly different, as there's good reason for that law and they can't simply be voided at the governments will.

 

[Sankari]

Yes you have the right to complain, but you don't have the right to tear their contracts up.

Of course I don't. I never said that I did. Not once did I propose that their contracts should be torn up.

The company gave these people the contracts. If they could prove they purposley screwed up then they could sack them. they can't so untill they change their contracts, they are entitled to what their contracts say.

Well, not necessarily. It depends on how the contracts are worded.

Bonuses are usually awarded on the basis of performance; just ask any city boy (hell, read the book Cityboy, by Geraint Anderson). If you perform well, you get a large bonus; if you perform badly, you get a small one (or you don't get one at all).

I doubt that contracts of this sort would specify exact figures; they're more likely to mention percentages, or "discretionary payments", because this ensures that the company isn't locked into paying out huge sums to some moron who completely mismanaged a client's account.

If a company ever did take the absurd step of writing a contract which states that a member of staff will receive a huge annual bonus regardless of his or her performance... well then, I'd call that clear evidence of (a) breathtaking incompetence, or (b) blatant corruption.

So many of these companies forget that it's not their money they're playing with; it's other people's. They're paid to manage it properly, and as a reward they're permitted to skim off a bit of the cream. They're not entitled to bring their own bucket and start helping themselves.

 

[Glaucus]

They have obviously met the conditions set out in their contract and that is why they are getting bonuses.

Do you agree this government meddling is bang out of order?

 

[Berserker]

The vast majority of those working for AIG had nothing to do with the problems, so why should they be penalised by legalised highway robbery.

How many of that vast majority earn above $250k though? I'll wager not many, in which case your point is moot.

If Obama is the constitutional scholar he claims to be, he should refuse to sign it into law.

I doubt it'll get to Obama in current form. US politics (from what little I've seen/heard of it over the years) seems much more prone to the knee-jerk reaction than we do. Their system is also somewhat different - the House and Senate can pass all the resolutions they want, but it doesn't mean any of them will necessarily become law.

 

[Mr C]

The problem with this is that some people given bonuses are based on targets set for their department.

What if their department did well last year but the rest of the company failed and got bailed out. Why should their achivement be screwed over just because the rest of the company failed. Totally unacceptable, it's a slap in the face for anyone who performed well last year and deserved their bonus.

 

[CaptainComedy]

The government should put restrictions on how the money they give is spent and leave the company manage it's own mess. Too much interfearance can only be bad.

 

[Dolph]

That's a bit extreme, there are already laws against "unfair contract terms", which can void contracts if the government doesn't like them. Contracts aren't the same as laws.

It's not retrospective though, this is, which is what makes it so underhand and a really bad example of why lawmaking based on popular opinion should be resisted at all costs.

 

[Raumarik]

I don't see any unfair contracts, people weren't moaning about them when times were good - especially politicians who seemed to think it was a sign of a thriving economy that some people were earning millions in bonuses.

 

[Stretch]

The government should never introduce knee jerk laws to satisfy public opinion.

Why not? Public opinion is their bosss after all.

 

[Glaucus]

Why not? Public opinion is their bosss after all.

Not at all.
They are also there to protect minorities. if public opinion was to kill all Asians, should they do it because it's public opinion. Of course not. The government should never do something for public opinion. Public opinion should bring things to the governments attention. It then needs to be proved a good and sound idea to be acted on. something that hardly ever happens when public opinion is involved.

 

[Energize]

Why not? Public opinion is their bosss after all.

No wonder there are so many fascist laws in this country these days.

 

[Dolph]

Why not? Public opinion is their bosss after all.

Because public opinion leads to bad laws, because it tends to trample all over the rights of the minority opinion, and everyone has a minority opinion or position on something.

If people have rights, public opinion is not sufficient to override it.

 

[Glaucus]

No wonder there are so many fascist laws in this country these days.

it explains why such rubbish governments keep getting reelected and why stupid laws which remove are rights are passed without anyone blinking.

 

[Goksly]

Not that you will ever change your mind, as its obvious that you are stuck on a mind set and cannot leave it, but its not about being jealous. The money part was in there as a point to say 'they are so rich, removing it won't affect their quality of life'. If it was a doctor who, even earning £250k a year, who was on top of their game beating all the KPIs they were measured against - yeah, give that guy a bonus. If they were messing up left right a center, give them a bonus? Like hell...

You seriously need to leave this jealous POV out of your arguments, because its clearly flawed.

 

[Glaucus]

Not that you will ever change your mind, as its obvious that you are stuck on a mind set and cannot leave it, but its not about being jealous. The money part was in there as a point to say 'they are so rich, removing it won't affect their quality of life'. If it was a doctor who, even earning £250k a year, who was on top of their game beating all the KPIs they were measured against - yeah, give that guy a bonus. If they were messing up left right a center, give them a bonus? Like hell...

You seriously need to leave this jealous POV out of your arguments, because its clearly flawed.

if it is so flawed then why even bring money into it.
The fact is they are fulfilling what ever their contract says. That is it. trying to change that contract or make laws to penalise specific groups is done. i can easily leave money out the argument and, my argument still stands true.

 

[JAzz]

Read on another site all bonuses on earnings above $250k would be taxed at this rate, sounds ok to me. If they have had to receive government funding to the level they have their earnings should be capped until they return the money.