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Forbes On FOX Debates Whether AIG Bonuses are “Great” For America

Reported by Ellen - March 22, 2009 -

Guest blogged by Brian

On Saturday's (3/21/09) Forbes on FOX, the panel debated whether or not AIG bonuses might be “great” for America. But as is almost always the case with FOX's Saturday “business” shows, the panel wasted no time using the topic to bash President Obama. With video.

First up was Jack Gage, Associate Editor. He thought bonuses were great because “they're a repudiation of that slippery slope” that the Obama administration is supposedly embarking on by restricting bonuses of bailed-out companies. "Being able to keep and compensate the most important employees at your financial institution is vital to turning this ship around."

Reporter Evelyn Rusli was worse. "The lifeline of those banks are their assets in terms of the people that work for them, that their top performers, their top earners and if we allow them to essentially cap their bonuses and reduce their upside potential, all these great top performers are going to go to other banks... We're going to strengthen the foreign banks while really hurting Wall Street. I mean New York as a financial institution is no more if this continues." Comment: That's not a reason to give out huge bonuses. Wall Street and the banks will somehow survive without them.

Elizabeth MacDonald disagreed. "They are bad for America. They basically are rewarding failure... The bonuses are going toward a unit that created $40.5 billion in losses." She added that there are a lot of laid-off Wall Street workers who could take those jobs for half the pay. Or, she thought, pay the current employees “in the rotten debt that they cooked up or in AIG stock. Why not that?”

Host David Asman admitted that was not a bad idea.

Mike Ozanian said, "What am I missing here? The Obama administration knew about these bonuses before it passed the program to lend them money. So, when you have a problem is when the government gets involved." Comment: No mention of the Bush administration's role in the situation.

Quentin Hardy is usually a reliably progressive voice. But he sidestepped the political end (something the conservatives rarely, if ever, do. Hardy said, "More pay does not mean better performance. It's about dedication and hard work... The point is they didn't do a better job for being overpaid. You're saying pay them more, they get better people, they don't."

Asman said, "Quentin, it's the basis of capitalism, that incentives work."

Hardy shot back, “Then union members should get higher pay, shouldn' they?"

To cap off the discussion, Gage compared Obama to the East German secret police: "Obama's Wall Street Stasi. It's going to be a state police department that is going after executive compensation.