Even though the AIG bonuses were small as compared to what is needed to economic recovery, the AIG bonuses are important because they greatly affect the morale of the people toward companies like AIG and the United States government on how the react to it. Yeah, the money would help a bit too, but the big part is the image that they are presenting.
Our economy needs to spend more money, not save it. I have seen on the news countless times where financial advisers are telling people to buy houses, cars, and things of that nature, because it is in the season. As soon as enough people buy more things, the economy will right itself again.
Given the huge amount of money that has gone into bailing out companies like AIG, these corporations need to maintain incentives to draw and keep the best talent possible. Without these incentives, companies like AIG will fail because those who can best put them back on the road to recovery will be lured elsewhere.
As much as I can not believe I am saying this but the AIG bonuses being paid is indeed important to the greater economic recovery. This is because by paying these bonuses it will signal to wealthy investors that the market is ready to make money and prosper again. Once the affluent investors see that they will not be penalized for profiting from investments and receiving a dividend check which in some ways can be compared to bonus checks.
AIG needs to recover to help the economy. The only way they will do that if their executives are some of the best in the business - they have a very tough job to do, and they need to be the best and the brightest. The only problem is that the best and the brightest often have a mercenary attitude about business - they migrate to where the money is. If AIG wants to keep and attract brilliant business minds, it needs to pay bonuses commensurate with similar businesses, or risk losing its best executives to rival companies. Bonuses may be hard for the public to swallow, but they're essential for the success of AIG, and for the recovery of the economy as a whole.
The AIG bonuses were given to already highly-paid executives, most of whom contributed to AIG's downfall. This money will not improve our economy. If we had spent the money, instead, on job creation, rebuilding our roads, sewers, bridges and other infrastructure, or paying for the re-education of laid-off workers, so they could get jobs in fields that are in demand, such as nursing and CAD/CAM manufacturing, this money would have gone a lot further towards helping our fragile economy improve.
The economy is struggling, but the AIG bonuses aren't doing anything for the average American. Being too big to fail doesn't encourage a company to change its practices or adapt to changing economic times. Bonuses may be good for people who are getting them, but not, in general, for everyone else who isn't.
AIG should not be giving out bonuses, because they accepted bailout money from the government. The employees who receive the bonuses are not saving the United States from going deeper into a recession. With the financial state the country is in, more people are saving, rather than spending, right now. This means that the bonuses will more likely go into a savings account, rather than in a shop or boutique.
AIG bonuses might be an important part for performance in a large company to get work done unlike small companies were you get paid to do your job properly. The incentive of doing a good job is to have a job at the end of the day not just a bonus. Paying out millions in bonuses creates more of a problem for rich people hoard money not allowing the economy to be stimulated like the poor person which has to spend every dollar to survive each month. Passing out free money to employees after needing bailed out by the government shows that those recieving bonuses just believe they are better and the government is an open market for stealing from the American tax payers. Bonuses would be okay if they earned it but not after they messed up the company and needed bailed out. If that is how we recieve bonuses maybe all employees should do their worst so they may recieve bonuses like AIG employees great job AIG employees loose money so the American Tax payers can pay for your bonuses.
No one should receive a bonus for poor performance. Receiving millions in bonuses when a company nearly collapsed would in real life cause the company to completely fail. If the company "too big to fail" required government money to avoid failure, the performance of management is so poor as to deny them any bonuses at all. They in fact should not have been kept in leadership at all.
The millions they took in bonuses came from many taxpayers. Each person with a few dollars extra could have paid for a child's field trip, a latte, a McDonald's meal, half a tank of gas or millions of other small purchases that would have helped the economy far more than a few millionaires who destroyed a company having millions more to squirrel away in savings accounts.
AIG bonuses do not help and they are not important to economic recovery. Public knowledge of such bonuses causes anger and frustration. The public feels we are struggling with economic issues and the government is bailing companies out - and then we find out that they are giving out astronomical bonuses. It makes things worse.
It is simply not fair that AIG bonuses were awarded, when so many people lost their jobs. A large part of economic recovery is reducing unemployment. When the bonuses were rewarded, they were also coming from bailout money that was intended to save AIG from a worse situation. They didn't make the best choices with how that money was allocated.
AIG employees are already paid tremendously compared to the average blue collar worker. The fact that an employee expects a 30% bonus on top of a six figure salary is wrong and insulting to people who perform actual work. A bonus is earned through performing above and beyond and should never be counted on as part of normal pay. Also, the employees who receive these large bonuses do not add it back to the economy via purchase. Rather, they sock it away in special accounts reserved for people with large sums of money and accrue interest at 4-5%.
AIG bonuses cannot contribute to greater economic review because bonus is given to only those how performs more than the company's expectation; meets performance goals. Only those employees will be benefited who are receiving the bonus not the whole economy and this cannot decrease high rate of unemployment and other economic issues. Again, giving bonuses in the time of economic recession will decrease AIG's profit, which has a negative effect on its shareholders.
AIG claims that the key to keeping good employees rests with their ability to provide bonuses. Bonus systems are traditionally given to employees for exceptional services and the ability to increase the finances of the company in, which they work. The recent economic downturn tells us that this system is broken. Additionally, with the high rate of unemployment, where are the AIG employees going to go? At this time, one wonders if AIG employees would risk unemployment, in lieu of losing bonuses.