The probable truth about AIG bonuses is the administration (Treasury) focused on the urgent need to get the near trillion Stimulus passed and felt the Snowe-Wyden bonus cap was insignificant and not worth stopping the whole show. This was an honest miscalculation of public reaction. In management perspective, focusing on the big picture was the right thing to do.
The AIG bonus mess can be quickly fixed by taxing the bonuses to whatever level Congress wants. So let Congress mend the AIG mess, then let's move on.
Might help, though, if Geitner admits his decision and makes time to explain to us these times are extraordinary and require inventing new cures from scratch. Which in the bigger picture, Mr. Geitner appears to be doing well. So far, we haven't all gone under - moneys are already in the hands of states, companies and institutions, and shovel-ready jobs are underway. Glitches like AIG will happen.
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