Thursday, March 19, 2009

A solution to the AIG bailout bonus scandal

(For those who are unaware: AIG the Insurance Giant which went bankupt recently and received billions of dollars in Federal bailout cash - awarded bonuses of 165 million to the same traders who were partly to blame for its financial demise.)

The solution - pass a law retrospective - which stipulates that such awards/golden handshakes/ payouts to all traders/bankers - have to meet the approval of a Federal inspector. They can't be given for no reason either. Obviously they have had to do something profitable to have earned it. If all else fails - subject such bonuses to a 99.99% tax. Yeah, go ahead - make my day.

I think the only way forward for the AIG and the rest of the corporate world - is to issue licenses and score cards to all financial operatives - bankers, accountants, traders, dealers etc.. These licenses and report cards have to show their track record. And it should be listed in a public data base which anyone can access. The Federal Govt should also have the ability to refuse the license of the financial operative if he screws up big time or has committed some crime - like insider trading etc..

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