It is impossible to escape the farce that is AIG. How can you pay someone a bonus for sending a company broke? The word “bonus” has been thrown around with such ease that many people are wondering what the word actually means.
Most of us believe that a “bonus” is a payment received for reaching or surpassing target. This of course only confuses the situation when looking at AIG because we are all aware that the US Government (in other words the US taxpayer), has paid almost US $200 billion to bailout the failing company.
To gain an insight on just how massive the AIG bailout is we can consider Australia. The Australian Federal Government had AUD $303billion (US$200 billion) in revenues in the 2007-2008 financial year. In other words the entire country was run on the amount paid to bailout AIG.
How can people be paid bonuses when the company made no money? Do AIG employees have targets that reward them for how much they lose rather than how much they make? So in the interest of getting it right I have looked up the word “bonus” in the dictionary and I found two (2) meanings that are relevant.
The first is: something given or paid over and above what is due.
The second is: a sum of money given to an employee in addition to regular pay, usually in appreciation for work done.
Given the disaster of a situation they caused, we have to conclude that AIG appreciates the mess their employees have created and are simply expressing their glee.
Things that make you go Hmmmmm.