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Have you heard about the earthquake that has shaken Wall Street to its very core? Well, brace yourself, for this really is a shocker: bonus payments are down.

Yes, the exorbitant bonus checks pocketed each year by the Goldman Sachers, Citigroupers, and other financial tinkerers have been cut by about 25 percent this year, and – oh! – you should hear the Wall Streeters moaning the hard-times, down-and-out banker blues. “It’s a disaster,” sobbed one, “The entire construct of compensation has changed.”

Cynics, of course, will say… “Good – about time.” And it is difficult in these times of middle-class collapse and rising poverty to get teary-eyed over a few financial swells getting a trim – but, come on, open your hearts to their pain. A hedge-fund manager, for example, says it’ll now be a strain for him to keep his $7,500 annual membership dues in the Trump National Golf Club. Plus, he worries about food, health care, and boarding. Not for him, but for his two dogs – he’s been laying out $17,000 a year for upkeep of his labradoodle and bichon frise, including around $5,000 to hire a daily dog-walker for them.

The crunch is so bad for these one-percenters that one says he now has to shop for discounted salmon for dinner and has had to give up his annual ski trip to Aspen. And a high-dollar accountant who does financial planning for the wealthy practically weeps for clients who’re having to cut back. Empathizing with the stress of it all, he asks: “Could you imagine what it’s like to say, ‘I got three kids in private school, I have to think about pulling them out?’ How do you do that?” Dabbing his eyes with tissues, he adds that these people have been raking in around $500,000 a year, and they never dreamed “that they’d be broke.”

Broke? Get a grip. We should all be as “broke” as they are.

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National radio commentator, writer, public speaker, and author of the book, Swim Against The Current: Even A Dead Fish Can Go With The Flow, Jim Hightower has spent three decades battling the Powers That Be on behalf of the Powers That Ought To Be – consumers, working families, environmentalists, small businesses, and just-plain-folks. Twice elected Texas Agriculture Commissioner, Hightower believes that the true political spectrum is not right to left but top to bottom, and he has become a leading national voice for the 80 percent of the public who no longer find themselves within shouting distance of the Washington and Wall Street powers at the top. He publishes a populist political newsletter, “The Hightower Lowdown.” He is a New York Times best-selling author, and has written seven books including, Thieves In High Places: They’ve Stolen Our Country And It’s Time To Take It Back; If the Gods Had Meant Us To Vote They Would Have Given Us Candidates; and There’s Nothing In the Middle Of the Road But Yellow Stripes and Dead Armadillos. His newspaper column is distributed nationally by Creators Syndicate.

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This piece was first published on Jim Hightower’s website.

Hoo, boy, it’s tough in our economy. I know you worry about your own little world, Bucko – whether you’re going to have a job, your shrinking paycheck, no health care, rising prices on everything… stuff like that. But, hey Bucko, it’s not all about you.

Show a little concern for those who’re taking a real hard hit in this lean year. Like Wall Street bankers.

Did you know that top executives at Goldman Sachs, JPMorgan Chase, Citigroup, Bank of America and so forth are facing up to 30 percent cuts in their bonus money? Some of them are looking at a bleak, Dickensian end-of-year holiday season with no more than maybe a $5 million dollar bonus stuffed in their stockings. I’ll pause here for a second so you can reach for a tissue to dry those tears. (more…)

By Leo W. Gerard
United Steelworkers International President

The nightmare for far too many is Cyborgs. The public fears HAL, the 2001 Space Odyssey computer that killed astronauts rather than forfeit its objective.

So terrified of the sentient machine, citizens overlook the allegory. The soft-spoken, reasonable-sounding HAL behaves exactly like a greed-driven, multi-national corporation. The corporate mission is profit. With 29 workers massacred in a Massey mine explosion and 11 slain in the BP oil rig explosion in just one month last year, greedy corporations have shown they’re willing to kill rather than forfeit their profit objective.

In America, the UK and Europe, the entities that should be feared — greedy corporations — are pulling politicians’ strings. Reckless speculation by multi-national financial corporations took down the world economy, creating the worst recession since the Great Depression. Governments – in the UK, Europe and America – used worker tax dollars to bail out the banks. Now those big banks are granting outsized bonuses and pay packages to their executives while demanding that governments balance recession-ruined budgets with cuts to social services, education, pay and pensions for government workers and worker’s rights to collectively bargaining for better lives.

Workers, students and pensioners in the UK and Europe have protested these measures for a year, from general strikes in Greece to national strikes in France. In the U.K. students, in the largest numbers since the 1960s, protested education fee increases. Last weekend, the U.K.’s Trades Union Congress (TUC) organized the March for the Alternative in which a quarter million demonstrators walked for five hours in London to protest austerity imposed on workers while corporations get breaks.

The diamond-crusted rich on both sides of the Atlantic have determined that workers and the vulnerable will pay the consequences of the bankster-caused recession. And they’re exploiting the financial crisis to strip workers of collective bargaining rights, preventing them from ever regaining what they’ve lost.

That is what’s going on in Wisconsin — and in a half dozen other American states where right-wing legislatures and governors are passing or pressing for legislation decimating workers’ rights to collectively bargain, even after workers accepted pay cuts to help balance budgets.

The disingenuousness of these right-wing governors in blaming public employees is clear. First of all, many of the state leaders granted huge tax breaks to corporations, lowering the states’ anticipated revenues, then demanded state workers bear the brunt of filling budget deficits.

Second, many of these governors didn’t stop at demanding public workers accept pay cuts. They also insisted on terminating workers’ rights to bargain for better pay, benefits and working conditions in the future. In addition, these right-wingers are meddling in the relationship between private sector unions and corporations. They want to forbid private employers from subtracting union dues from paychecks and remitting the money to the union. And they want to pass legislation intended to bankrupt unions and to prevent them from supporting progressive candidates who would treat workers fairly and protect their rights.

This is how it played out in Wisconsin: The governor, right-winger Scott Walker, gave corporations more than $100 million in tax cuts then decreed that public workers, such as teachers, nurses and librarians, take wage and benefit concessions. And Walker threatened to send out the National Guard, a state-run militia despite the name, to quell protests. This raised the specter of the May 4, 1970 massacre at Kent State when Ohio National Guardsmen called out by the governor gunned down unarmed students protesting the Vietnam War.

Contrary to Walker’s expectations, his threat energized opposition. Repeatedly, tens of thousands of workers, students, retirees, environmentalists, religious leaders and children poured into the streets and occupied the state capitol building in Madison, Wisconsin to protest the right-wingers’ plan.

Walker’s proposal passed in the state Assembly and needed a vote in the state Senate before it could get to his desk for final signature. To prevent a quorum needed to vote on the measure, all 14 Democratic senators left the state. They became known as the “Fab 14” as they remained holed up in hotels in Illinois for weeks, trying to negotiate a less draconian measure with the governor.

Although public opinion polls showed 60 percent of Wisconsin citizens opposed cutting collective bargaining rights, although workers already had accepted the pay reductions Gov. Walker had contended were vital to balance the budget, although protestors occupied the capitol building with a sit-in and sleep-in for weeks, the right wingers devised a scheme, in a secret meeting behind doors locked to the public, to vote without a quorum to deny government workers their collective bargaining rights.

In the midst of the dispute, Gov. Walker revealed his puppet masters – the Koch brothers, owners of the Georgia-Pacific paper company, with plants in the United States and the U.K. While contending he had no time to talk to progressive leaders or union officials about his union-busting legislation, Gov. Walker jumped on the phone for 20 minutes when told the caller was billionaire David Koch. The billionaire was Walker’s second largest campaign contributor; he provided $1 million to a fund to attack Walker’s opponent, and he bankrolls the right-wing’s right-wing, the Tea Party.

Events in some other countries show it doesn’t have to be this way. Brazil just passed a law giving unions a director’s seat on each board of a state-owned company. And in Australia, progressive labor legislation has enabled unions to increase membership by 20 percent in the past two years.
There are some signs of success in U.S. workers’ struggle to stop the corporate-backed right-wing campaigns. A Wisconsin judge has halted implementation of the union-busting measure because the way conservatives passed it appears illegal. And progressives are working to recall – or remove from office – eight right-wing Wisconsin senators who voted against worker rights. They’ve pledged to mount a recall campaign against Gov. Walker as soon as it’s legally possible.

In addition, labor activists and their supports have derailed proposed anti-union legislation in Indiana and Missouri.

That’s an indication of what coordinated coalitions of citizen protesters can do. That’s an indication that organized workers with their allies can take on global capital and win.

The difference between HAL and corporations is that HAL is fictional while greedy multi-national corporations are real threats.  In the end, a human defeated HAL. In democracies, workers united with their allies can take on corporations and win as well.

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Leo W. Gerard also is a member of the AFL-CIO Executive Committee and chairs the labor federation’s Public Policy Committee. President Barack Obama recently appointed him to the President’s Advisory Committee on Trade Policy and Negotiations. He serves as co-chairman of the BlueGreen Alliance and on the boards of the Apollo Alliance, Campaign for America’s Future and the Economic Policy Institute.  He is a member of the IMF and ICEM global labor federations and was instrumental in creating Workers Uniting, the first global union.

Zach Carter
Economics Editor, AlterNet; Fellow, Campaign for America’s Future

I agree with everything Paul Krugman has to say about Max Abelson’s excellent run-down of the Wall Street whinery, but his critique stops a little too short. Abelson’s piece emphasizes that Wall Street isn’t really upset about any policies the Obama administration has adopted, since, as I and many others have noted, the Obama administration has been very friendly on that front. What they’re upset about– at least what they say they’re upset about– is the jargon. Obama called bailed-out bankers “fat cats” after they paid themselves obscene bonuses with taxpayer money. To the bankers Abelson quotes, this amounts to some kind of unfair discrimination. That’s absurd– the bailout barons Obama criticized had wrecked the economy and then paid themselves like princes for profits secured by taxpayer largesse. Those who did not benefit from such largesse have no reason to feel slighted by the critique, and those who did benefit have no reason to be complaining from their second homes in the Hamptons.

But what I find most interesting is that the cry-babies in Ableson’s story actually threaten to wreck the economy over this rhetoric. The key passage is at the end of Ableson’s piece:

Wall Street’s emotions have consequences. “If, as a result of this anger, credit becomes unavailable, particularly for small and mid-size businesses,” Mr. Schwarzman wrote in The Washington Post this year, before his Poland blunder, “then at best the economy will slow and, at worst, we will find ourselves in a dire situation.” He said bankers felt under siege and were responding by “becoming conservative,” a lovely little pun about lending and politics. (more…)

Zach Carter
Economics Editor, AlterNet

What is the penalty for bankers who tell $40 billion lies? Somewhere between nothing and a rounding-error on your bonus.

The SEC just hit two Citigroup executives with fines for concealing $40 billion in subprime mortgage debt from investors back in 2007. The biggest fine is going to Citi CFO Gary Crittenden, who will pay $100,000 to settle allegations that he screwed over his own investors. The year of the alleged wrongdoing, Crittenden took home $19.4 million. That’s right. Crittenden will lose one-half of one percent of his income from the year he hid a quagmire of bailout-inducing insanity from his own investors. That’s it. No indictment. No prison time. Crittenden doesn’t even have to formally acknowledge any wrongdoing.

In 2007, as financial markets were freaking out about the subprime situation, Citi repeatedly told its investors that it owned just $13 billion in subprime mortgage debt. It was true–if you didn’t count an additional $40 billion in subprime debt that the company was also holding onto.

Citi’s CEO at the time, Chuck Prince, has not been charged with anything. As Yves Smith emphasizes, all of the top financial officers of every major corporation are responsible for the accuracy of their quarterly financial statements. Lying on those statements is a federal crime. This is the sort of thing that securities fraud cases are built around.

The SEC’s own statements about what went on at Citi are damning. If the agency can make this kind of information public, they ought to be pursuing criminal prosecutions. The SEC says that senior Citi management had been collecting information about the company’s subprime situation as early as April 2007, but repeatedly cited the $13 billion figure to investors over the next six months, waiting to acknowledge the additional $40 billion in subprime debt until November 2007. The SEC also says that Crittenden knew the “full extent” of Citi’s subprime situation by September at the latest, but the company continued to cite $13 billion in earnings reports through October. (more…)

By Richard Trumka
President, AFL-CIO

So now we learn that as millions of America’s families were losing their homes, Goldman Sachs cheered because it stood to make huge money betting on a housing market gone bad. Is that Wall Street’s vision of American values? It’s not mine. And it’s not the values of the thousands of working Americans who are marching on Wall Street today in person with me and online.

Our message is simple: Big Banks tanked our economy and took our money when they needed a bailout. Now they’re thumbing their noses at our communities but making billions in profits. It’s time they pay up.

Pay up by investing in communities to create jobs for the millions of unemployed workers–like Terry in Florida, who was laid off a week before Christmas. Being forced to return his family’s Christmas gifts to the store was just the beginning of his pain. While the corporation he worked for is turning a profit, he fears his family will be homeless by summer.

Meanwhile, in 2009, 25 hedge fund managers were paid the equivalent of the salaries of 680,000 school teachers. That’s in 2009, when we taxpayers spent billions of dollars bailing out the financial sector. If Goldman Sachs is cheering at the collapse of the housing market, what’s the rest of Wall Street saying? Thanks, suckers?

Those may be Wall Street’s values. They’re not America’s.

In a stunning new Pew poll, more than half of those surveyed say within the past year a member of their household has been out of work–up 15 percentage points since last year. Fully 70 percent of Americans say they have faced one or more job- or financial-related problems in the past year, up from 59 percent in February 2009.

And homelessness no longer is a scourge of the most troubled of our society. Maria Foscarinis, executive director of the National Law Center on Homelessness and Poverty, describes the nation’s epidemic of homelessness as reaching crisis proportions not seen since the Great Depression–and it stems directly from the Big Bank-fueled recession in which millions of workers lost jobs and savings and can no longer afford their mortgage or rent.

Meanwhile, the Big Banks announced massive first quarter earnings–Citigroup, $4.4 billion; Bank of America, $4.2 billion; Goldman Sachs, $3.46 billion; JPMorgan Chase, $3.3 billion; and Morgan Stanley, $1.8 billion. It turns out that much of that money was made by the same risky trading practices that cost taxpayers a $700 billion bank bailout.

The damage inflicted has deepened economic inequality, which has gotten worse since 2007. The richest 10 percent now control nearly 70 percent of the wealth. Those with incomes in the bottom 50 percent have a little more than 2 percent of the wealth.

The bottom line is Wall Street should pay to clean up the mess they made and Congress must enact strong Wall Street reform. We are supporting four ways for the Big Banks to pay–President Obama’s bank tax, a special tax on bank bonuses, closing the carried interest tax loophole for hedge funds and private equity and, most important, a financial speculation tax levied on all financial transactions–including derivatives–that would raise more than $150 billion a year, according to the Congressional Budget Office. The financial speculation tax would have a negligible impact on long-term investors but would discourage the short-termism in the capital markets that led to so much destruction over the past decade.

Congress also must aggressively address the jobs crisis now–if not because it’s the right thing to do, then because of November 2010. That Pew poll I cited above? It found Americans united in the belief that the economy is in bad shape: 92 percent give it a negative rating.

Wall Street’s values are based on greed. The American people’s values are rooted in working hard, playing fairly and doing right by our family, neighbors and friends.

If you can’t march and rally with us on The Street, join us live online today at 4 p.m. EDT. We’ll be 10,000 strong on the ground and marching for tens of thousands more who have signed up to take part in our virtual march.

Working people are angry–and we are right to be angry at the betrayal of our economic future. Help us turn that anger into the energy to create jobs, fix our economy and build a stronger nation.

 By Richard Trumka
President, AFL-CIO

So, $9 million in stock options as a 2009 bonus for Goldman Sachs CEO Lloyd Blankfein is now considered a big concession from Wall Street–a way of recognizing that the rest of the nation isn’t sharing in the Big Bankers’ party. Before we all start applauding, let’s take another look at what’s really happening on Wall Street. Over at Bank of America, a top CEO is raking in $29.9 million. Chairman and CEO Jamie Dimon is getting $17.6 million at JP Morgan Chase. And at Goldman? Bonuses total $16.2 billion.

Concessions? From financial institutions saved by taxpayers in a year when more than 4 million Americans lost their jobs, largely because of the actions of these very institutions? But wait. We’re actually supposed to feel sorry for the pampered financial set–because this year they’re not getting as much in up-front bonus cash as fast as they’d like since the corporate payouts are more often in stock (another concession). So taxpayer-bailed-out corporations like Bank of America and Citigroup are doling out stock shares that employees can sell within months–much sooner than normally allowed–because as the Wall Street Journal tells us:

The new pay culture is squeezing bankers with hefty mortgage payments and private-school tuition bills–and has prompted some companies to find ways to assist cash-squeezed employees.

“I know it sounds ridiculous to Main Street, but it’s a hardship,” says Gary Goldstein, who runs Whitney Group, a financial-services job-search firm in New York.

Meanwhile, these same corporations are spending multi-millions to kill reform of the financial industry. In 2009, JP Morgan Chase spent $6.2 million in lobbying. Bank of America: $3.7 million. Citigroup: $5.6 million Wells Fargo: $2.9 million. Goldman Sachs: $2.8 million.

We’ve got an idea for these Wall Street wreckers: Instead of tucking billions of dollars away in the pockets of a handful of individuals, how about putting that money toward creating jobs–a few billion dollars can go a long way. Just $8.4 billion spent on transit would create 253,539 jobs–and generate untold positive economic reverberations throughout communities starved for dollars to keep them viable. Just $1 billion would fund the Clean Water State Revolving Fund (H.R. 2847) and result in 27,823 jobs. Another $10 billion would rebuild the infrastructure of our nation’s deteriorating schools and create the jobs to do it.

Main Street has helped Wall Street–and it’s time for Wall Street to pay the bill to create jobs and fix the economy it wrecked. From March 15-26, the AFL-CIO and our allies are holding rallies and demonstrations at branches of the Big Six Wall Street banks–Bank of America, Chase, Citigroup, Wachovia-Wells Fargo, Goldman Sachs and Morgan Stanley–across the country. We are telling the banks: Make Wall Street Pay for Creating New Jobs.

So-called ‘green shoots’ and rises in stock prices aren’t going to fix our economy. We will not be out of the recession until we are creating good jobs on a large level. We need 11 million jobs to get out of the hole dug by the recession. And we need to make sure this kind of financial crisis never happens again.

One way Big Bankers can help honestly rather than playing at responsibility is to back a financial speculation tax on securities transactions to curb financial guessing games. A modest financial speculation tax will help curb harmful Wall Street practices–and raise
$100 billion to $300 billion annually to pay for job creation. This would go a long way toward creating the jobs we need, and also would help curb churning, high frequency trading and other speculative activity that harms capital markets. I joined Warren Buffett and other business leaders who came together under the auspices of the Aspen Institute to call on Congress to consider a financial speculation tax because financial companies must not be allowed to go back to business as usual–or worse.

Another way Wall Street could act honorably is to support a strong, independent consumer protection agency that would root out the kinds of abuses that helped lead to the financial crisis and destroy jobs. Harvard Law Professor Elizabeth Warren, who heads up the congressional committee to oversee the Troubled Asset Relief Program (TARP), writes that the financial industry can regain the public trust by supporting such a program.

For years, Wall Street CEOs have thrown away customer trust like so much worthless trash.

Banks and brokers have sold deceptive mortgages for more than a decade. Financial wizards made billions by packaging and repackaging those loans into securities. And federal regulators played the role of lookout at a bank robbery, holding back anyone who tried to stop the massive looting from middle-class families. When they weren’t selling deceptive mortgages, Wall Street invented new credit card tricks and clever overdraft fees.

But as Warren points out and as the big bonus payouts show, there hasn’t been a whole lot of real soul searching among the banking class.

So far, Wall Street CEOs seem determined to stop any kind of watchdog. They seem to think that they can run their businesses forever without our trust. This is a bad calculation.

Hard-working Americans will not be ATMs for Wall Street. That’s why we in the labor movement are working to hold Wall Street, and Congress, accountable for protecting Americans who play by the rules, preventing future bailouts and job losses and laying the foundation for a financial system that promotes stability and long-term economic growth for our nation and for all.

We support President Obama’s proposed tax on the largest financial institutions to recoup the cost of their bailout program. We urge the president and Congress to make financial re-regulation a top priority by:

• Creating an independent new consumer financial protection agency.
• Regulating the shadow capital markets, including hedge funds, private equity and over-the-counter derivatives.
• Reforming corporate governance and executive pay.
• Creating a systemic risk regulator that is fully public and accountable.

But remember when President Obama announced his intention to propose a Financial Crisis Responsibility Fee? That fee would require the largest and most highly leveraged Wall Street firms to pay back taxpayers for the extraordinary assistance provided so the TARP program does not add to the deficit.

Even before the announcement, Big Bankers were squealing like stuck pigs. From Think Progress:

Edward Yingling, president and chief executive, American Bankers Association: “To impose yet another burden on the industry would obviously decrease their ability to lend.”

So it’s not looking real good that Wall Street’s change of heart is more than a wink and a multi-billion-dollar nod. That means it’s up to the president, Congress and the rest of us.

By Dean Baker
Co-Director, Center for Economic and Policy Research

As Treasury Secretary, Robert Rubin put in place all the pieces that set up the economy for the disaster that we are now living through. He pushed legislation that weakened regulation of the financial sector; he cheered on a stock bubble that eventually grew to $10 trillion and he established an over-valued dollar as a matter of official policy.

He then left to take a top job at Citigroup where he was able to enjoy the fruits of his labor. He earned well over $100 million in the decade after he left the Clinton administration. In the fall of 2008, when Citigroup was saved from bankruptcy with a taxpayer bailout, Rubin quietly slipped out the back door (with his money), resigning from his position at Citigroup.

It may not seem just that someone like Rubin would be allowed to live out his life in luxury after the policies that he promoted and personally profited from led to so much suffering for so many people. But that is the way things work in the United States these days. However, what is even more infuriating is that he doesn’t seem to have any intention of going away. He is still pontificating on the economy and desperately trying to rewrite history to exonerate himself.

In a recent public talk, Rubin told his audience that “virtually nobody” saw the financial meltdown. Therefore, he excused himself for missing it along with everyone else. While it may be true that the top people in policy circles and among the Wall Street crew with whom Rubin associates really are clueless about the economy, it was in fact very easy for a competent economist to see the crisis coming.

House prices diverged from a 100-year long trend in the mid-90s, just as the stock bubble began to pick up steam. By 2002, nationwide house prices had risen by more than 30 percent after adjusting for inflation. This followed a 100-year period in which they had just kept even with the overall rate of inflation.

There was no plausible explanation for this run-up in house prices based on the fundamentals of either the demand or supply side of the housing market. Income and population growth were relatively slow by historical standards. In addition, we were building homes at a near record pace, so there clearly were no major obstacles on the supply side. Furthermore, there was no remotely comparable increase in rents, so there was no evidence of an undersupply of housing; a fact that was also borne out by the record vacancy rate of this era.

So, it should have been clear to Robert Rubin and every other economic analyst that the housing market was in a bubble. When I first began writing about the bubble in 2002, it had already created more than $2 trillion in housing-bubble wealth. By its peak in 2006, the bubble had grown to more than $8 trillion. Could anyone believe that $8 trillion in housing wealth could disappear without serious consequences for the economy? This was the most predictable disaster imaginable. There was no excuse for the people in policy positions having missed it.

This is why it is infuriating to see Rubin still running around with his stories about “virtually nobody.” The response is that anyone who had a clue could not miss the housing bubble and they should have done everything in their power to try to deflate it before it reached ever more dangerous proportions. Rubin did the opposite — he put in place bubble friendly policies as Treasury secretary, then profited enormously from these policies after his return to Wall Street.

Reading Rubin’s comments, it is hard not to think of George Wallace. The former governor of Alabama made his name on the national stage as an ardent supporter of segregation, famously blocking the schoolhouse in front of young black children trying to attend a previously segregated school.

Later in his life, Wallace had a change of heart and regretted his earlier actions. He went around to commemorations of major events in the civil rights era and begged for forgiveness. Wallace’s presence at these events was no doubt painful for many of those who had to confront the brutality of the racist system in which Wallace had played such a key role. He could have served the world much better with more private expressions of contrition.

Having inflicted enormous damage on tens of millions of families who have lost their jobs, their homes and/or their life’s savings, it would be nice if Rubin could have the decency to fade from the public scene. At least Wallace had the integrity to acknowledge that he had been wrong.

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Dean Baker is author of the new book, “Plunder and Blunder: The Rise and Fall of the Bubble Economy,” PoliPoint Press, LLC. This piece was first published on Huffington Post.

Watching people desperately trying to hang on to their little all following a disaster is an experience, as Aristotle would have appreciated, certain to excite pity and terror in the human breast.

If only we didn’t have to spend so much time these days watching bankers and corporate executives do it.

Every day seems to present yet another example of the disjunction between the financial community’s sense of entitlement and the real world occupied by everybody else.

The other day, the inspector general for the government’s financial bailout program, known as TARP, revealed that Chrysler’s lending arm requested $750 million in new money but was turned down because its top 25 executives wouldn’t all agree to the compensation limits TARP requires.

That’s after the government had already given Chrysler Financial $1.5 billion. (Chrysler says, for its part, that it decided it didn’t need the additional money after all. Nothing to do with the pay caps, it says. But of the original $1.5 billion, so far it has repaid only $3.5 million.)

Meanwhile, a passel of Wall Street professionals unburdened themselves to New York magazine about the punitive cuts in pay and bonuses they’re suffering — imposed, to their minds, by jealous people less talented and successful than they.  More

This column was first published April 23, 2009 in the Los Angeles Times.

By Leo W. Gerard
International President

AIG Chairman Edward M. Liddy gets the Creep of the Week award for his stunning, overwhelming, dumbfounding display of cluelessness.

Liddy not only awarded $165 million in bonuses to the very AIG employees whose risky speculation in credit default swaps bankrupted the once-great insurance giant, forcing it to beg for $170 billion in taxpayer bailouts, he then claimed he was a helpless victim of retention bonus contracts written before he took over in September. Here’s exactly what he said: “Quite frankly, AIG’s hands are tied.”

No other contender for this week’s Creep prize awarded by the USW sunk close to those depths of obtuseness. And in so many diverse areas! Let’s count the ways:

First, there’s Liddy’s claim that he just can’t squirm out of contracts. Boy, he’d be the first CEO on God’s green earth to be too feeble to break a contract. Think about it: Congress insisted that the Big Three auto companies crack open their contracts with the United Auto Workers to qualify for federal bailout money. Union contracts at all sorts of companies across this country have been broken, bent, re-opened and renegotiated by cooperative labor organizations willing to accept a variety of cuts to preserve employment during an economic crisis caused by the likes of, well, let’s face it, reckless speculators at AIG! But, somehow, Liddy couldn’t find a way to break, bend, re-open or renegotiate contracts with the white collar workers who caused the mess taxpayers are both suffering and cleaning up.

Second, there’s Liddy’s claim that he had to honor the bonus contracts or he’d be sued by his employees. With a straight face, Liddy asserted that the employees in AIG’s Financial Products subsidiary who neglected to account for the possibility of a decline in real estate prices would actually list their names on court documents contending they deserved extra money after bankrupting the company. If Liddy thinks there’s a jury in America that would buy that argument and award the bonuses, I’ve got some credit default swaps I’d like to sell him. It’s clear, in fact, even Liddy doesn’t buy the argument since he’s declined to publicly release the names, though he has given a great deal of information – under duress – to New York Attorney General Andrew M. Cuomo who is working on a lawsuit to recover the bonuses for taxpayers.

Third, there’s Liddy’s failure to understand these simple facts: people who caused a company’s demise don’t get bonuses and neither do employees of companies getting bailouts with federal tax dollars. The average AIG bonus payment was $395,000 – though 51 employees got more than $1 million and the winner of the fattest bonus got $6.4 million. Liddy told Congress he has asked some of the 418 recipients to return half of their bumps. If all 418 complied, the average would decline to a mere $197,500. That may be chump change to a Wall Streeter, but it is a life-saving sum to a middle class worker who has lost his job or can’t pay his mortgage because of Wall Street’s greed and  recklessness. In addition, there’s an important reciprocal issue Liddy failed to understand: the fury he has provoked by paying those bonuses has made the middle class even less willing to invest their tax dollars in any future bailouts that Congress may claim AIG or Wall Street banks desperately need.

Fourth, there’s Liddy’s ability to treat with reverence those who caused the financial meltdown while regarding with disdain those who suffer as a result of it. It was Liddy’s contention that his white collar workers were special. He had to give them the bumps, or they would abandon AIG, refusing to clean up the mess they’d made. That didn’t apply to auto workers, though. No one cared what happened to them. They could be furloughed as a result of Wall Street’s misbehavior — and pay taxes to clean it up as their bonus. But what’s worse is the level of continued boldfaced, outright deception from Liddy and his like. The bumps were crucial for retention, he said, right? Wrong. Cuomo discovered that 11 big time bonus beneficiaries – those who got $1 million or more – had already left AIG.

Fifth, Liddy acted as if the American people didn’t already own 80 percent of his company. Earlier this month, after AIG reported a $61.7 billion quarterly loss, the largest in corporate history, the federal government promised to help prop it up by giving it another $30 billion in taxpayer dollars. The solution here is simple, as the Washington Post pointed out in a story last week. If the feds simply insist on a 100 percent share of the company, which, frankly, the American people deserve for that kind of investment, the bonuses stop.

In addition to Creep of the Week, Liddy gets a special bonus award: Clueless of the Week.