Here's an interesting piece by the NYT's detailing the progression of the hearings on the Hill.
Watching the A.I.G. Hearing on the Hill - The Caucus Blog - NYTimes.com
It's interesting to note that Libby, the Chairman/CEO, came out of retirement for a salary of $1 a year to unwind the three units of AIG responsible for this mess. Bless his heart, because I am betting he wished he had just stayed in the masses bettering his golf game.
"he repeated throughout his testimony, he and others weighed approving the bonuses to keep employees in the risky business areas from fleeing and possibly causing the collapse of a big-book unit valued at $1.6 trillion. If they walked out the door, A.I.G. was at considerable risk of falling apart because the most fragile business unit would have imploded, he said today."
Endurance | 6:34 p.m. Mr. Liddy has shown a lot of patience, or endurance, as one lawmaker just characterized his demeanor after nearly five hours on the grill, and he’s had to explain these retention bonuses over and over again, as one House member after another pokes at the logic of such rewards: Why does an employee or an executive receive a retention bonus only to leave A.I.G. anyway?
Apparently, some of these bonuses were promised at the beginning of 2008 for such “books of business” that had to be wound down (for example the derivatives book is down to $1.6 trillion from $2.7 trillion). As employees working those books succeeded, and completed much of the task at hand, they still were entitled to the bonuses even as they left, Mr. Liddy said. He did not know how many had left, and what amount those employees received.
Go On, Take the Money and Run | 4:59 p.m. Mr. Liddy just predicted that many executives and employees might resign rather quickly, given the political climate and the giant bull’s-eye painted on A.I.G.’s logo. Many employees, he said, might stay a little while longer, return the bonuses but resign.
Bonus Recipients Have Feelings, Too | 2:48 p.m. Bonus recipients do have a conscience, Mr. Liddy offers, after saying a little while ago that most of the employees who were responsible for the risky credit-default swaps are gone. Those who have stayed have already reduced the risky business from $2.7 trillion to $1 trillion. “We have to keep shrinking this business dramatically and quickly so it doesn’t get away from us,” he added.
He has a plan. Wind down the riskiest business, as quickly as possible, then sell off the good insurance business to pay back the taxpayers.
“It’s not a failed company, it’s a failing company unless we do something about it,” Mr. Liddy warned.
About Those Contracts | 1:57 p.m. Correction here, it seems. Mr. Liddy point out to Congressman Frank that the bonuses under attack are not performance-based bonuses, they are only retention bonuses in the financial products group which is the most troubled unit. Therefore, those contracts Mr. Frank released may not apply.
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I just took some excerpts, but the full article is worth reading. The political grandstanding alone is laughable.
I do not agree with the largess of the bonuses, given the political/ economic climate--but I do know that knowledgeable employees are crucial to a companies bottom line-- especially in financial services. These employees are essentially salespeople, with a book of business and industry contracts. We all know some people are better salespeople than others. So, AIG doesn't award the retention bonuses, people walk, then where does that leave us since we now own AIG? hiring new people who have to be trained on their systems, who may or may not have the same abilities? I am not sure, but that takes time. Do they hire some new snot nosed Ivy league finance grads looking to make a name for themselves, good or bad?
. There are some great deals in the Hamptons if anyone is interested. ;-)
I truly feel her once in a lifetime dream was scaled back to be PC. 
