Cyre2067
The Living Force
_http://www.alternet.org/workplace/133627/aig_exec_whines_about_public_anger%2C_and_now_we%27re_supposed_to_pity_him_yeah%2C_right/
This one's good too: _http://www.huffingtonpost.com/mitchell-bard/why-i-have-no-sympathy-fo_b_179520.html
Pretty good stuff.
AIG Exec Whines About Public Anger, and Now We're Supposed to Pity Him? Yeah, Right
By Matt Taibbi, AlterNet. Posted March 26, 2009.
AIG exec Jake DeSantis's NY Times letter asking for us to chill out about his poor overworked employees is a sick joke.
"I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down." via Op-Ed Contributor - "Dear A.I.G., I Quit!" - NYTimes.com
Like a lot of people, I read Wednesday's New York Times editorial by former AIG Financial Products employee Jake DeSantis, whose resignation letter basically asks us all to reconsider our anger toward the poor overworked employees of his unit.
DeSantis has a few major points. They include 1) I had nothing to do with my boss Joe Cassano's toxic credit default swaps portfolio, and only a handful of people in our unit did 2) I didn't even know anything about them 3) I could have left AIG for a better job several times last year 4) but I didn't, staying out of a sense of duty to my poor beleaguered firm, only to find out in the end that 5) I would be betrayed by AIG senior management, who promised that we would be rewarded for staying, but then went back on their word when they folded in highly cowardly fashion in the face of an angry and stupid populist mob.
I have a few responses to those points. They are 1) Bullshit 2) bullshit 3) bullshit, plus of course 4) bullshit. Lastly, there is 5) Boo Fucking Hoo. You dog.
AIGFP only had 377 employees. Those 400-odd folks received almost $3.5 billion in compensation in the last seven years, a very large part of that money coming from the sale of credit default protection. Doing the math, that averages out to over $9 million of compensation per person.
Ask yourself this question: if your company made that much money, and the boss of the unit made almost $280 million in just a few years, exactly how likely is it that you wouldn't know where that money was coming from? Are we supposed to believe that Jake DeSantis knew nothing about Joe Cassano's CDS deals? If your boss and the top guys in your firm were all making a killing selling anything at all -- whether it was rubber kayaks, generic Levitra or Credit Default Swaps -- you really wouldn't bother to find out what that thing they were selling was? You'd really just mind your own business, sit at your cubicle, and put your faith in the guys up top to fill you in if there was something you needed to know?
This would be a believable claim for an employee of some other wing of AIG, a company with well over 100,000 employees. But DeSantis works for tiny, 377-person AIGFP, a unit that had only two offices, one in London and one in Greenwich, Connecticut. And we're talking about financial professionals, the most shameless group of tirelessly envious gossips ever to walk the face of the earth. The likelihood that Joe Cassano would pull in $280 million for himself, and his equally greedy, hopelessly jealous employees wouldn't know not only exactly how he made that money but every last ugly detail about his life -- from what skank he's sleeping with to what side of his trousers he hangs on -- is almost zero. I know plenty of people who work in this world and I've met very few who didn't hate with every cell in their bodies anyone in their own companies who made more money than they did or got bigger bonuses at Christmastime. Gossiping about each others' bonuses, and bitching about each others' compensation, is the national pastime for these people.
So forgive me if I don't buy this story that poor Jake and his buddies didn't know about Cassano's CDS business. Also, there's this: let's just say, Jake, that you're telling the truth, that you don't know anything about this toxic portfolio. If that's the case, then why the fuck does anyone need to retain you at an exorbitant salary to help unwind that very portfolio? If these transactions aren't and never were your expertise, then where the hell is your value here? When I spoke to Christine Pretto, the AIG spokeswoman, and asked about those bonuses, she said that AIG needed to retain people like you in order to take advantage of your "knowledge of these transactions." So if you don't have knowledge of these transactions, what are you being paid for? Your winning attitude?
Then there's the matter of Jake's other job offers. About that: It was apparent as early as last February that Cassano had basically destroyed not only the unit but perhaps AIG itself. The company announced over $11 billion in losses around that time. If I'm Jake DeSantis, and I'm really innocent, I'm looking for a job that very instant. And I'm taking the first good job anyone offers me. Because by then I'd have realized that I was working for the latest version of Enron. That the man I've been working for for the last six or seven years has turned out to be one of the most irresponsible Wall Street villains of all time, a man who single-handedly destroyed the 18th-largest company in the world. If I'm Jake DeSantis, I'm quitting out of moral disgust, because I don't want to be associated with this kind of behavior.
The only reason I'd stay is if I didn't have a choice. Which I feel sure is what happened here. If Jake DeSantis didn't take advantage of an opportunity to get a better job elsewhere with a company that didn't hide billions in losses and make $500 billion bets with money they didn't have, that's his fucking problem. The notion that I the taxpayer have to pay this asshole a million-dollar bonus because he turned down a better job at a less guilty company is repugnant to begin with; the notion that he stayed at AIGFP because he expected me to pay him this bonus makes me hate him even more. But it's all moot, because I feel quite sure it's a lie. As one trader for another firm told me not long ago when I asked what he thought about the need to pay these "retention bonuses" to these "valued employees" at AIGFP:
"Yeah, right. Who would hire these guys? They'd stay for a dollar if you offered it to them, much less a million."
I mean, half of Wall Street is unemployed right now. There are plenty of unemployed traders out there whose resumes don't include such entries as "Worked for years at small unit of AIG that helped destroy the universe; throughout that time was completely ignorant of burgeoning global disaster unfolding five feet from my desk." The idea that other companies would be so anxious to pass over the seas of truly innocent available people in order to scoop up some still-employed veteran of AIGFP -- and that they would be so enthusiastic in their pursuit of said AIGFP employees that AIG would need to pay those AIGFP folks million-plus retention bonuses to get them to stay -- is so ludicrous it almost defies comment. Show me, anywhere, the Wall Street firm that's willing right now to spend more than a million dollars poaching still-employed mid-level executives like Jake DeSantis, when they can just put an ad in the paper and have 500 recently-unemployed CEOs begging for work at almost any salary in five minutes. So the idea that the rest of Wall Street is breaking down AIGFP's doors to lavish its idiot personnel with million-dollar offers is just utterly preposterous. The fact that DeSantis expects us to believe this is insulting in itself.
Also, remember, DeSantis until this year was probably the recipient of performance bonuses. This year, obviously, there was no performance, so AIG doled out these "retention" bonuses instead. And the value of these retention bonuses is seriously in question if AIG never really needed to pay extra to retain this personnel, which I personally believe they didn't. I personally believe these "retnetion" bonuses were a ruse cooked up by management to suck a few more dollars out of the company before it sank to the ocean bottom. So if DeSantis is "owed" these bonuses it's only in the sense that someone up above agreed to cheat the shareholders by paying these bonuses out when they weren't really necessary; they weren't "earned" in any real sense.
But all of this is really secondary to the tone of DeSantis's letter. He acts like he's a victim because he didn't get to keep his after-tax bonus of $742,006.40 in the middle of a global depression. And he really loses his fucking mind when he writes:
None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.
First of all, Jake, you asshole, no plumber in the world gets paid a $740,000 bonus, over and above his salary, just to keep plumbing. Secondly, try living on a plumber's salary before you even think about comparing yourself to one; you're inviting a pitchfork in the gut by even thinking along those lines. Thirdly, Jake, if you were a plumber, and the electrician burned the house down -- well, guess what? If you and that electrician worked for the same company, you actually wouldn't get paid for that job. Out in the real world, when your company burns a house down, you're not getting paid by that client. It's only on Wall Street, where the every-man-for-himself ethos is built in to an insanely selfish and greed-addled compensation system, that people like you expect to get paid in a bubble -- only there do people expect their performance bonuses no matter how much money the shareholders lose overall, no matter how many people get laid off after the hostile takeover, no matter how ill-considered the mortgages lent out by your division were.
You expect that money because you think it's owed to you. But what money? The money is gone. Your boss, if not you, set it all afire. You want the money, but where exactly do you think it's coming from? Do you just not understand that that that money now would have to come out of someone else's pocket? That it would have to come from middle-class taxpayers, real plumbers, people who didn't make millions over the years in equity and commodity trading?
Here's the real problem with people like Jake DeSantis.Throughout this whole period they never were able to connect the dots -- to grasp the fact that when they skimmed a million here or a million there off the great rivers of capital that flowed through their offices, that that money came from somewhere, from someone. To them, it wasn't someone else's money, it was just money, and why shouldn't they have it?
It's remarkable that when DeSantis in his letter touts the reason he deserves his high compensation, all he can talk about is how much money he made: "The profitability of the businesses with which I was associated clearly supported my compensation." For a guy like this, his worth as a human being is wrapped up in buying a bag of beans for $10 and selling it for $11. He states this like it's a law of nature: he was a good equities and commodities trader, therefore he should make a lot of money. Only a person with a habitually over-inflated sense of self-worth could think he deserves a $700,000 retention bonus, even if it has to be paid by taxpayers, when in reality no one "deserves" that much money. It may be that some people do get paid that much, but most people who make that much money have enough sense to realize their cushy lifestyles are an accident of fate, of birth, of class, not something that is "supported" by some unwritten natural law of compensation.
Hey Jake, it's not like you were curing cancer. You were a fucking commodities trader. Thanks to a completely insane, horribly skewed set of societal values that puts a premium on greed and severely undervalues selflessness, communal spirit, and intellectualism -- values that make millionaires out of people like you and leave teachers and nurses, the people who raise your kids and clean your parents' bedpans, comparatively penniless -- you made a lot of money.
Good for you. Consider yourself lucky. But your company went belly-up and broke, almost certainly thanks in part to you, and now you don't get your bonus. So be a man and deal with it. The rest of us do, when we get bad breaks, and we've had a lot more of them than you. And stop whining. Jesus Christ.
This one's good too: _http://www.huffingtonpost.com/mitchell-bard/why-i-have-no-sympathy-fo_b_179520.html
Why I Have No Sympathy for Jake DeSantis
On Tuesday the New York Times ran on its op-ed page the resignation letter written by Jake DeSantis, a vice president of AIG's infamous financial products division. DeSantis essentially argues that he had nothing to do with the credit default swaps that nearly brought down the company (and the world economy), and that since he agreed to work for a $1 salary plus his bonus, AIG CEO Edward Liddy should have stood up for him and "innocent" executives like him.
The lawyer in me (I should really say "recovering lawyer," since I haven't practiced in 15 years) understands his point. He contracted to work with his salary essentially being his bonus, and after fulfilling his obligations (he argues that it was a form of public service, but let's just stick to the idea that he served the company), the CEO is asking him to forgo his pay. It's an argument, in strictly letter-of-the-law terms, I could comfortably make to a judge or jury.
But as a person, I am not the least bit moved by DeSantis's point of view, because over the last several years, he has tremendously profited from a larger financial culture that is completely out of whack. Those working in the financial industry made untold sums of money from a bubble that was bound to burst, and they did so in an environment that rewarded risk with no consequences for failure.
In other words, DeSantis has become wealthy beyond his wildest dreams, with no worries about money for the rest of his life, at the expense of most Americans and the financial system as a whole, all by taking advantage of a set of rules that skewed in his favor. He profited from an industry that rejected decades of regulations and took crazy risks that a bubble could be sustained against all logic to the contrary, and that firm's could leverage themselves at unhealthy levels with no consequences. And now that some semblance of order is trying to be applied to the financial industry, with the bill being footed in billions of dollars by the American people, he has the audacity to complain that he is being treated unfairly? It's like someone finding a hole in the side of a bank vault and stopping by once a year to take millions of dollars from the structure, only to complain on the 15th trip when the hole has been sealed up.
DeSantis writes in his resignation letter that his bonus amounted to $742,006.40 after taxes. In the letter, he acknowledges that he and Liddy "have never met or spoken to each other," so it's clear that DeSantis was not at the most senior levels of management, which would lead one to believe that there are several (even many) other AIG employees at DeSantis's level, making this kind of money. All for a company that has required hundreds of billions of dollars from the U.S. government to survive.
My point in listing DeSantis's bloated salary isn't, as my friends on the right will probably immediately accuse me of doing, an effort to attack wealth or wealth creation. Rather, my quarrel with DeSantis's letter is that it represents an unwillingness to confront the culture that not only caused the current financial collapse, but that will prevent true recovery if it's not addressed.
It seems that those in the upper reaches of the financial industry would prefer to completely ignore the fact that a combination of greed, a system that encouraged risk for short-term profits without consequences, and a total absence of regulation has created a global financial meltdown. From unemployment, to a lack of available credit, to the plummeting of the stock market, the recklessness of financial institutions has created massive damage. The current administration has had to contend with the fallout from this damage, and there is no easy answer in sight.
You would think that those who created this mess would have some humility. But you would be wrong. DeSantis's letter is just one example. In a front-page New York Times article on Monday discussing the administration's attempts to get private equity firms and hedge funds to buy into Treasury secretary Timothy Geithner's new plan to purchase toxic assets from banks, the chief executive of a "major investment firm" is quoted as saying,
"The deal is good, but it's not worth it if I'm buying myself into a retroactive tax or a Congressional hearing."
The article notes that
"some executives at private equity firms and hedge funds, who were briefed on the plan Sunday afternoon, are anxious about the recent uproar over millions of dollars in bonus payments made to executives of (AIG)."
When I read observations like these, I just cannot believe that these people are so blind as to what has happened to the financial industry in the last six months. I know these individuals profited from a bubble, but apparently they are also living in one. And it makes me feel like solving the current difficult problems will be even harder, because we are not learning the lessons of how we got here in the first place.
A plan to rescue the banks without addressing and changing the compensation culture on Wall Street is like treating a cancer patient's symptoms without eradicating the tumors. The relief will be only temporary.
As President Obama noted in his 60 Minutes interview on Sunday:
"You know, you look at how finance used to operate just 20 years ago, or 25 years ago. People, if you went into -- investment banking, you were making 20 times what a teacher made. You weren't making 200 times what a teacher made."
When the American public was outraged over the AIG bonuses last week, there was incredulity in some quarters. But while the bonuses are a drop in the bucket relative to the overall billions given to the company by the government, the distress and anger voiced by the American people was about more than just AIG. The rage comes from the fact that a small group of people in the financial industry (relative to the population as a whole) brought down the economy with their greed, and, more importantly, have failed to take any responsibility for their industry's role in the debacle. That was what the AIG bonuses stood for to a lot of people. There was outrage that the executives in this industry had not learned their lesson, that they wanted the gravy train to keep rolling, despite the calamity that had occurred.
Even if Geithner's plan rehabilitates the banks and restores a functioning financial system, it will be for naught if the same compensation-frenzied culture exists in the industry, since it will mean that it's only a matter of time before the system is threatened again. And based on the statements of the anonymous investment firm CEO quoted in the Times and DeSantis, it doesn't look like financial executives are ready to adjust their expectations, despite the damage caused by greed run amok.
That is why DeSantis's resignation letter failed to stir any sympathy in me. President's Obama's comment about the escalation of financial executive compensation is far more compelling. If DeSantis doesn't want to be a part of the solution, if he wants to hold onto a system in which it is reasonable to pay him (and, presumably, many others) $742,006.40 after taxes, by a company accepting hundreds of billions from the federal government, I can only come to the conclusion that he doesn't understand where we need to go. He is part of the problem, not the solution. Good riddance to him, and let the door hit him on the butt on the way out. DeSantis may have a valid contract, but it's a product of a corrupt system. And it's time for the system to change, if we truly want to rebuild the nation's financial institutions and economy.
Pretty good stuff.
Great articles Puck!! 
