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GAO: Treat Big Money just like Big Auto


The U.S. Treasury should demand that American International Group Inc., the insurer rescued by taxpayers, seek concessions from employees, creditors and derivatives counterparties* as a condition of its aid, the Government Accountability Office said.

“Treasury could require that AIG seek to renegotiate contracts with its employees, similar to the contract for retention bonuses with AIG Financial Products’ employees, and with existing counterparties that would face substantial losses were AIG to have its credit downgraded or fail,” the GAO said.

“If such concessions are not considered to be in the government’s interest, the reasons should be clearly articulated and explained,” it said.

A group of 27 lawmakers last week called for a federal probe into whether AIG should have been forced to renegotiate its counterparty contracts with Goldman Sachs Group Inc. and other banks.

The U.S. has propped up New York-based AIG four times, with total aid now valued at $182.5 billion, since September after a cash shortage left the insurer unable to back up protection sold to banks on their fixed-income holdings.

You know, there are times when it seems that only the Obama adminitration doesn't get this.

Well, and the Republicans, of course, but we never had any hope for them.

The Obama administration shouldn't be asking union retirees to give up one fucking cent while all the gamblers on Wall Street getting their payouts one hundred cents on the dollar. It's unconsionable.

NOTE * When we the people bailed out AIG, AIG promptly turned around and paid what we gave them to its creditors -- the so-called "counterparties" who were gambling on derivatives contracts with AIG (who lost, thus having to pay out). And they paid out one hundred cents on the dollar. So, while contracts with banksters are sacred, contracts with unions are not. And while you can play in the Big Shitpile and expect to be paid in full, you can work for GM for thirty years and have your benefits cut -- even though you paid in every paycheck to get them.

Plus ça "change," plus c'est la même chose...

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Submitted by jawbone on

are using and will continue use populist arguments against Dems, especially those in Congress, whom they consider weaker than Obama. Right now. When Obama loses some poll points, he will be attacked by Repubs using populist arguments.

It's pretty scary to me to hear a Repub making arguments against Team Obama and Dem legislation which sounds, well, rational.

The arguments which, used rationally, should be every Dem pol's intellectual heritage, should be in every Dem's DNA, should be used to cement Dem gains. If Dems had WH leadership to do things FOR the people, not just use them to support Big Banksters, Dems would be on a glide path to reelection in 2010 and should be expecting gains. But, nooooo. We've got a leader of the party who seems at times to want to destroy the party.

Damn New Dems. Are they as bad as the Southern Dems were for FDR? I don't know that history well enough to say, but they seem to like being Repubs Lite.

What a mess.

Why, oh, why, oh, why-o, why does BO love St. Ronnie and the labor busting he rode forward on?

Damon's picture
Submitted by Damon on

The Obama administration shouldn't be asking union retirees to give up one fucking cent while all the gamblers on Wall Street getting their payouts one hundred cents on the dollar. It's unconsionable.

We here you loud and clear, Lambert:

GENESEE COUNTY, Michigan -- Workers bit their tongues, a car dealer said he felt better, and a former mayor of Flint said he was disappointed by President Barack Obama's statements on the auto industry.

Obama called for more concessions by General Motors workers, bondholders and others, saying further cuts are necessary to avoid bankruptcy. But in Burton, James Jennings, an employee at GM's Service and Parts Operations Flint Processing Center in Swartz Creek, was among employees who said they can't take much more sacrifice.

"As far as I feel, I'm already being robbed," said Jennings, who said many workers, including himself, haven't had a wage increase in more than five years and just two weeks ago took a slight pay cut.

Jennings' advice for turning the company around: Leave wages and health care benefits alone and look at cuts in extra incentives, such as day care and legal services for employees.

Bill Jordan, UAW Local 599 president, said he was also frustrated by the constant suggestion that autoworkers need to give back more to the company.

"What is enough?" asked Jordan, who represents hourly workers at Powertrain Flint North, most of whom are currently on layoff. "I'm highly irritated by people who have no idea how hard people are working in here."

Obama's announcement Monday on the auto industry and GM's failure to prove itself viable topped off a whirlwind 24 hours that included the forced resignation of company Chairman and Chief Executive Officer Rick Wagoner.

Fenton-area resident and former GM Vice President of Manufacturing Guy Briggs said Wagoner "fell on the sword for the company."

"To me, this is more of a public display of control (by Obama) and the idea that they needed to make a statement here," Briggs said. "With AIG and all the storm over that, they are concerned about public opinion.

"I was totally shocked by it, and it doesn't make a lot of sense to me."

This White House better learn to pick its fights better, or they could very easily lose huge chunks of labor for 2012. There are already Republicans, here, playing their faux-populist tunes by complaining about the double standard who are waiting to grab disenchanted manufacturing workers, and if they can't win them over, they are hoping to crush their spirits to the point of where they simply keep them apathetic and thus keep them from voting, altogether.

If the New Democrats want to keep showing that they believe these manufacturing workers are second-class workers, well, they can lose them and lose them, big. People think we're dumb, up here, and have nowhere else to go. This administration has far less political capital, up here, than they think they do...