It’s good that the Obama administration and Congress are trying to recoup some of the $165 million in bonuses paid out this weekend by American International Group. As Rep. Barney Frank, D-Mass., complained: “These bonuses are going to people who screwed this thing up enormously, who made terrible decisions.” But there may be little that can be done, as AIG appears to have been legally obligated to pay the bonuses. Congress also needs to be careful not to overreact to populist outrage, as it did on business jets.
No one likes bailing out companies such as AIG, which made “all kinds of unconscionable bets,” as Federal Reserve Chairman Ben Bernanke said Sunday on “60 Minutes.” But as Bernanke also noted, “We have no choice but to stabilize, or else risk enormous impact, not just in the financial system but on the whole U.S. economy.”
Registered?Commenting on WE Blog now requires you to be a Kansas.com member. Use the links above to register, if you haven't already, or to log in.
Do you tweet? Follow us on Twitter: @WE_Tweet.