Insurance Giant AIG Announces $165 Million in Bonuses

The revelation that fledgling insurance giant AIG would be dolling out $165 million in executive bonuses has drawn outrage from Washington as both the White House and U.S. senators have taken shots at the company.

AIG’s announcement comes on the heels of the company receiving $180 billion in government bailout money to prevent its very collapse. Despite their precarious financial situation AIG said they had little choice in handing out the bonuses, citing legal obligations tied to the contractual bonuses.

That explanation didn’t sit well with many who have accused the insurance company of incompetence and negligence as well as misusing taxpayer money.

Among those outraged by the AIG situation was President Barack Obama’s economic adviser Larry Summers who called the happenings with the company “outrageous,” but conceded “The easy thing would be to just say... off with their heads, violate the contracts. But we are a country of law. The government cannot just abrogate contracts.”

Mitch McConnell, the Senate Republican leader, appeared less compassionate when he stated, “Did they enter into these contracts knowing full well that, as a practical matter, the taxpayers of the United States were going to be reimbursing their employees? Particularly employees who got them into this mess in the first place? I think it's an outrage.”

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