Bailouts and Bonuses for AIG

It’s believed to be the biggest government rescue of an American company ever.

And now insurance giant AIG is being criticized for spending some of its $180 billion bailout on bonuses.

Hello I’m Charlotte Bellis and you’re watching Newsy.com

We’re following coverage from MSNBC, FOX News, The Independent, The New York Times and the Huffington Post.

First, MSNBC noted that the federal government now owns 80 percent of AIG.

And, that the bonuses are going to the very unit that got it into trouble in the first place.

“Taxpayers have paid $170 billion to the company, and this $165 million, as you mentioned, is going to go to the employees at the center of the company's meltdown, those who sold those credit default swaps.” (MSNBC)

FOX News called “AIG” the latest four-letter word.

“Who knows if there's more to come to keep AIG propped up and prevent the collapse of the global financial system. This isn't fair.” (FOX News)

In England, the Independent blamed Obama for “failing to halt” the bonuses.

“Mr. Obama, who said paying bonuses was ‘shameful’ while companies were on government life support, has found changing Wall Street culture to be more difficult than anticipated.” (The Independent)

The New York Times noted the AIG fallout has the Obama administration concerned that public anger at AIG and Wall Street could create a backlash directed at the White House.

“Mr. Obama’s aides said any surge of such a sentiment could complicate efforts to win Congressional approval for the additional bailout packages that Mr. Obama has signaled will be necessary to stabilize the banking system.” (The New York Times)

On Huffington Post, columnist Robert Reich said the “real scandal of AIG” is the government’s helplessness despite the massive taxpayer bailout.
   
“When our very own Secretary of the Treasury cannot make stick his decision that AIG's bonuses should not be paid, only one conclusion can be drawn: AIG is accountable to no one. Our democracy is seriously broken.” (The Huffington Post)

Do you think the U.S. government should force AIG to stop the bonus payments?

We invite you to take a look at our sources and leave your comments.