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AIG Axes Exec Compensation

Troubled insurance giant AIG, which has received $125 billion in government bailout money and outraged lawmakers and taxpayers by continuing to splurge on luxe vacations for its people, just announced that it would severely cut back its executive compensation.

AIG chief executive Edward Liddy will lower his annual salary for 2008 and 2009 to $1, the company announced. Further, he will not be eligible for severance payments. In other words: no golden parachute.

Further, AIG will pay no bonuses and give no raises through next year for its top seven executives and no raises through next year for its next-50 top execs.

AIG is also working on a structure to prevent taxpayer dollars from eventually finding their way to potential future exec bonuses, the company said.

Frank Ahrens

The Ticker is Twittering!

By Frank Ahrens  |  November 25, 2008; 11:27 AM ET
Categories:  The Ticker  | Tags: AIG, executive compensation  
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Comments

"AIG is also working on a structure to prevent taxpayer dollars from eventually finding their way to potential future exec bonuses, the company said."

When pigs fly.

Posted by: posterchild90 | November 25, 2008 11:46 AM | Report abuse

This is a small baby step in the right direction. But it is not enough. AIG management needs to do a great deal more to be worthy of taxpayer support.

Posted by: KarenElsie | November 25, 2008 11:46 AM | Report abuse

Too little, too late. If there ever was a company that needed to lop off the heads of it's top management, AIG is it. For sheer arrogance, they are leagues ahead of the auto industry. No more government help for them, it's either swim or sink from here on out!

Posted by: surfer-joe | November 25, 2008 12:03 PM | Report abuse

OMG - How will he put food on his family?

Posted by: netwitone | November 25, 2008 12:20 PM | Report abuse

They ought to axe the "executives" as well as the "compensation." In the real world if you screw up you get FIRED! Obviously any group of miscreants that can drive a major company into the ground and STILL have the nerve to blow $440K on an executive retreat needs to take a reality break.....on the unemployment line.

Posted by: Bushwhacked1 | November 25, 2008 12:28 PM | Report abuse

Food on his family! LOL

Posted by: fbutler1 | November 25, 2008 12:31 PM | Report abuse

Lenin was right!

The capitalist economies are tearing themselves apart! Had the Soviet Union not corrupted his ideals, communism would now be triumphing!

The Revolution shall begin anew

Posted by: alex18 | November 25, 2008 12:57 PM | Report abuse

"Too little, too late. If there ever was a company that needed to lop off the heads of it's top management, AIG is it."

I agree. They knew what they were doing when they blew that money on a vacation.

Sorry guys, but you had your chance, and you blew it.

Posted by: legendarypunk | November 25, 2008 12:58 PM | Report abuse

The FBI should be investigating AIG, CITI, WAMU and others for corrupt practices and malfeasance. My recommendation for continued aid is no raises or bonuses for five years and no more golden parachutes anywheres any time.

Posted by: Billy1932 | November 25, 2008 12:59 PM | Report abuse

Not enough!! ALL six-figure employees should take a two-year bonus freeze, then a two-year wage freeze at the bottom with wage cuts on a sliding scale up the ladder, ending at $1.00 for the top.

And they damn well BETTER protect MY money that's in there! If they "sink", so do the small investments of millions(?) of Main Street Americans!

Help 'em "swim", but they can't have MY life vest!

Posted by: AverageJane1 | November 25, 2008 1:13 PM | Report abuse

Yeah, five years is better, Billy.

Posted by: AverageJane1 | November 25, 2008 1:15 PM | Report abuse

Please note that while you are punishing the executives with "no more money", you are shafting millions like me who have our retirement invested in AIG. I am 65 and cannot start over!

Posted by: cosborne4 | November 25, 2008 1:30 PM | Report abuse

Chomp! Chomp! Criticize AIG's actions all you want BUT we need them to make the right choices. We need them to succeed. Cutting the salaries of over paid executives and reducing their comps is the right step! This is leadership going in the right direction!

NOW it's time for the BIG 3 executives to follow AIG...

http://www.ibelievethis.us

Posted by: voicewithin | November 25, 2008 1:52 PM | Report abuse

So, exactly how much do these top 50 execs make, exactly?

Posted by: Heerman532 | November 25, 2008 2:01 PM | Report abuse

Good news. Now, after going on the government dole, can we look at the $400 million citigroup is using to subsidize a new Mets stadium. (rolls eyes)

Posted by: edbyronadams | November 25, 2008 2:12 PM | Report abuse

It's about time. This was a no-brainer from the very start. How did people stupid enough to use their golden parachutes in time of financial disaster and top it off with a big, expensive party in California get to be executives anyway? I'd be surprised if those ill-advised actions were part of the curriculum at Penn's Wharton or Harvard's Business schools. If they were, I'm witholding my alumni giving.

Posted by: TESimonton | November 25, 2008 2:32 PM | Report abuse

Saving AIG makes about as much sense as keeping a fish after it started stinking. Save an 'insurance' company? Ya gotta be kidding! And look what they did with taxpayer money -- pricey meetings and conferences. Trips to the UK? Where's MY spa treatment/golf outing? And then they get MORE money and hold MORE meetings!
Next thing, we'll start bailing out local car dealerships -- ever find one that had a BBB rating of satisfactory or cared that their rating wasn't?
Gotta thank the Republicans again for another fine eight years. Just NOBODY bail those losers out, OK?

Posted by: bgreen2224 | November 25, 2008 3:46 PM | Report abuse

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