What happened to the congressional uproar about AIG executive bonuses?

Ssssssh! Never again mention those AIG bonuses in the hallowed halls of Congress.
Ssssssh! Never again mention those AIG bonuses in the hallowed halls of Congress.

All they could talk about in Congress a couple weeks ago was the AIG executive bonus issue.

The vigilantes in Congress were going to tax ‘em. Grab ‘em. Put ‘em back in the U.S. Treasury where they belong. And maybe tar and feather the execs while they were at it. It was the most important issue of the century.

Then it all went away, mysteriously replaced by the kind of eerie silence found only at the National Library.

Daniel Schwartz, a Hartford employment law attorney, may have an explanation for the new, quieter, more gentle tone in Washington, DC. It all revolves around the case of a Connecticut-based company called Mortgage Lenders Network that found itself in a situation remarkably similar to AIG:

The company had built a nationwide presence by making subprime loans and was in the midst of building a big new headquarters in the state. But by late 2006, it was going through some financial difficulties as credit lines came to a halt and then it allegedly failed to pay some employees commissions–at least $1.6 million total. (These were, after all, the same employees, who participated in the company’s subprime lending practices.)

Ultimately, MLN filed for bankruptcy. What did the state do then? It had an investigator from the Department of Labor look into the situation and ultimately issued an arrest warrant for the Company’s president back in March 2007 for failure to pay wages and sales commissions on time.

Schwartz concludes:

“…if the State was willing to go after an employer for failing to pay just $1.6M in wages and sales commissions, is it fair now to suggest to employers in Connecticut, like AIG, that they can now simply ignore obligations they make to their employees because they are going through financial difficulties and can’t really afford to pay them?”

Speak a word of those bonuses now and Nancy Pelosi will put her index finger before her lips and personally tell you to sssh!

Source: Connecticut Employment Law Blog via WSJ.com

I HATE THE MEDIA ™
Verified by MonsterInsights