AIG is paying out a round of bonuses -- $100 million in all -- to retain employees.
For one thing, as I've asked in the past, why would you want to retain employees responsible for nearly destroying the company?
Another thing, even if these people left the company, where would they expect to find work? Taco Bell?
And after all we did for AIG -- remember the $150 billion bailout? -- we don't even get a thanks.
What's the biggest problem facing business today? What's preventing businesses from flourishing? What's harming the economy and keeping the middle class down?
If you answered taxes, you'd be wrong.
According to a new book, "Money for Nothing: How the Failure of Corporate Boards is Ruining American Business and Costing Us Trillions," you can take a guess. Corporate boards are causing much more harm to the economy than you realize.
Frederick E. (Shad) Rowe, founder and president of Investors for Director Accountability, General Partner of Greenbrier Partners investment firm and former chair of the Texas Pension Review Board, in a blurb, wrote: "Please read 'Money for Nothing.' This brilliant book properly shines the light of day on the true enablers of the systematic looting of the American shareholder and the financial crisis that brought our economy to its knees. I predict Money for Nothing will prove a world changer for humiliated investors and those corporate directors who betrayed them."
Sounds about right. Check it out here.
According to this great column by Newsweek economics writer Dan Gross, people who default on mortgages are held responsible for their debts and are a threat to capitalism itself.
But banks and billionaires walk away from debt all the time and it's perfectly OK. And besides that, they can expect the generous taxpayers of this nation to bail them out.
Just another example how the rich are different from you and me. They are deadbeats.
And it's an example of the old saw: If you owe the bank $10,000, it's your problem. But if the bank owes $10 billion, it's your problem.
An America without a middle class?
Elizabeth Warren, who chairs the panel overseeing the bank bailouts, writes in The Huffington Post that the middle class is an endangered species. She backs up her assertion with some very solid, and sobering, economic data.
Read it here.
Here's a taste:
"Through it all, families never asked for a handout from anyone, especially Washington. They were left to go on their own, working harder, squeezing nickels, and taking care of themselves. But their economic boats have been taking on water for years, and now the crisis has swamped millions of middle class families.
"The contrast with the big banks could not be sharper. While the middle class has been caught in an economic vise, the financial industry that was supposed to serve them has prospered at their expense. Consumer banking -- selling debt to middle class families -- has been a gold mine. Boring banking has given way to creative banking, and the industry has generated tens of billions of dollars annually in fees made possible by deceptive and dangerous terms buried in the fine print of opaque, incomprehensible, and largely unregulated contracts.
"And when various forms of this creative banking triggered economic crisis, the banks went to Washington for a handout. All the while, top executives kept their jobs and retained their bonuses. Even though the tax dollars that supported the bailout came largely from middle class families -- from people already working hard to make ends meet -- the beneficiaries of those tax dollars are now lobbying Congress to preserve the rules that had let those huge banks feast off the middle class."
Her piece concludes:
"America today has plenty of rich and super-rich. But it has far more families who did all the right things, but who still have no real security. Going to college and finding a good job no longer guarantee economic safety. Paying for a child's education and setting aside enough for a decent retirement have become distant dreams. Tens of millions of once-secure middle class families now live paycheck to paycheck, watching as their debts pile up and worrying about whether a pink slip or a bad diagnosis will send them hurtling over an economic cliff.
"America without a strong middle class? Unthinkable, but the once-solid foundation is shaking."
And we seem to be at the epicenter here in York County.
Reading the coverage of the union vote at Harley Davidson, it was hard to miss one of the themes -- a lot of union workers voted for the contract even though it meant they'll probably lose their jobs.
They voted for the contract so that others could keep their jobs and that Harley would be able to stay in York. Imagine that: There are people who work at Harley who's world extends beyond their own screen door. They were willing to sacrifice for the benefit of others.
These are good people.
Whenever you hear some idiot blathering on about selfish, greedy union workers, point that out to them.
And another Harley note: You'd think the company would have at least waited a while to announce it was staying in York. Announcing it immediately makes it clear that it never intended to move and that the threat was intended to put the union in a bad position -- accept concessions or be blamed for the demise of Harley in York.
Oh well, that's the way the world goes 'round, as John Prine once said.
Today's Daily Record has an interesting contrast.
On the front page was a story about a poll that showed people are feeling more confident about the economy. The headline: "Confidence boost."
Inside the paper, as a colleague pointed out, there were 22 pages of classifieds advertising foreclosures.
Maybe people are confident that they'll be able to afford nice tents to live in. They are on sale at Gander Mountain.
Sunday's column has to do with the wildly entertaining House Financial Services Committee hearing on the bailout.
I know, it doesn't sound funny. But check it out.
First, we have Rep. Maxine Waters, a California Democrat.
Read the Los Angeles Times story about Waters' lobbying for a bank that has her husband on its board of directors here.
And then, Rep. Michele Bachmann, a Minnesota Republican.
Democracy in action!
Here is a New York Times story about the currency thing Bachmann was talking about. It doesn't really have to do with a world currency replacing the dollar. It's a little more complicated than that. And still, Geithner is not in favor of it.
Also, props to the snarky political blog Wonkette for its coverage of the hearing.
New York Times columnist Bob Herbert nails it.
He wrote:
"Working families were in deep trouble long before this megarecession hit. But too many of the public officials who should have been looking out for the middle class and the poor were part of the reckless and shockingly shortsighted alliance of conservatives and corporate leaders that rigged the economy in favor of the rich and ultimately brought it down completely.
"As Jared Bernstein, now the chief economic adviser to Vice President Joseph Biden, wrote in the preface to his book, 'Crunch: Why Do I Feel So Squeezed? (And Other Unsolved Economic Mysteries)':
"'Economics has been hijacked by the rich and powerful, and it has been forged into a tool that is being used against the rest of us.'"
Read it here.
In this clip, Jon Stewart dissects CNBC's coverage the financial meltdown.
Brilliant.
It has long bothered me that that Cramer guy is still on the air, after all of the lousy advice he's given. He was telling people to buy Lehman Brothers right up until the day Lehman Brothers collapsed.
Also, CNBC's breathless business coverage and ego-stroking interviews with CEO's does nothing to help people understand the most devastating economy since the Great Depression.
Once again, it takes Jon Stewart, a comedian, to show how ridiculous the media can be.
Neil Young rocks the bailout. The chorus:
"There's a bailout coming but it's not for you.
"It's for all those creeps hiding what they do.
"There's a bailout coming but it's not for you.
"Bailout coming but it's not for you."
Throughout our economic crisis, Nobel Prize-winning economist and New York Times columnist Paul Krugman has been nailing it. His analysis and predictions have been spot-on, but his dismal view of how this crisis will play out has turned off a lot of people.
Once again, this week, reviewing the minutes of the most recent meeting of Federal Reserve's open market committee, Krugman finds the news, something that others may have ignored.
He writes: "Most press reports focused either on the Fed's downgrade of the near-term outlook or on its adoption of a long-run 2 percent inflation target.
"But my eye was caught by the following chilling passage (yes, things are so bad that the summarized musings of central bankers can keep you up at night): 'All participants anticipated that unemployment would remain substantially above its longer-run sustainable rate at the end of 2011, even absent further economic shocks; a few indicated that more than five to six years would be needed for the economy to converge to a longer-run path characterized by sustainable rates of output growth and unemployment and by an appropriate rate of inflation.'"
Krugman says this economic slump is unlike others this nation has experienced and will cause a great deal of pain and suffering before it's all over. Economic stimulus plans and rescue plans for financially troubled homeowners may mitigate the slump, he writes, but we're in for a long, dark period.
Is there a silver lining? He says we may pull out of it eventually, but it's going to take longer than we think.
Read the whole thing here.
Which country, in recent years, has not repealed regulations that keep banks from making poor investments and taking wild risks?
And, which nation has not had a single bank failure during this worldwide banking crisis?
The answer is here.
Often, our own U.S. Sen. Arlen Specter, R-Pa., gets criticized for his moderate stances, irritating those on the left and the right with his willingness to try to get something done.
He has come out in favor of the stimulus bill, albeit a compromise bill hammered out by a small group of senate moderates.
He explains his position in a Washington Post op-ed piece here.
It begins: "I am supporting the economic stimulus package for one simple reason: The country cannot afford not to take action.
"The unemployment figures announced Friday, the latest earnings reports and the continuing crisis in banking make it clear that failure to act will leave the United States facing a far deeper crisis in three or six months. By then the cost of action will be much greater -- or it may be too late."
Arlen gets it. How come the right-wingers, whose fiscal policies of the past 28 years have led to this disaster, don't?
Still, Nobel-prize winning economist Paul Krugman argues that the centrist approach doesn't go far enough to fill the hole we've dug ourselves. Krugman, who has been right in calling the shots in this economic disaster, says President Obama erred in trying to forge a bi-partisan coalition in favor of the stimulus bill and that his attempts to do so watered down the Senate version to the point of reducing its effectiveness.
Krugman writes: "So has Mr. Obama learned from this experience? Early indications aren't good.
"For rather than acknowledge the failure of his political strategy and the damage to his economic strategy, the president tried to put a postpartisan happy face on the whole thing. 'Democrats and Republicans came together in the Senate and responded appropriately to the urgency this moment demands,' he declared on Saturday, and 'the scale and scope of this plan is right.'
"No, they didn't, and no, it isn't."
Read his piece here.
Here's Del McCoury and some friends updating a tune that has some meaning these days.
Today's New York Times column by Nobel-prize-winning economist Paul Krugman lays out why we need this economic stimulus package in pretty strong language.
He writes: "It's time for Mr. Obama to go on the offensive. Above all, he must not shy away from pointing out that those who stand in the way of his plan, in the name of a discredited economic philosophy, are putting the nation's future at risk. The American economy is on the edge of catastrophe, and much of the Republican Party is trying to push it over that edge."
Read the whole thing here.
