Like most everyone, I've read the letter to the editor in the NY Times addressed to Ed Liddy. My take, for what little it's worth, is that the letter is self-serving and sanctimonious. It's an attempt by the writer to portray himself as a martyr. First, what's the point of releasing the letter to the NY Times but to call attention to yourself. However, I think he reveals his true motivations several times - "during which A.I.G. reassured us many times we would be rewarded in March 2009", "nor am I being paid to do so", "we have worked 12 months under these contracts and now deserve to be paid", "Many employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.'s assurances that the contracts would be honored". Truth be told, the writer and is associates were not motivated by a desire to rectify the mistakes others in his unit, A.I.G.-F.P, made, but to get big paydays in 2009. Further, he notes that "some might argue that the members of my profession have been overpaid, and I wouldn't disagree", then goes on to say "that is whay I have decided to donate 100% of the effective after-tax proceeds of my retention payment". This isn't an altruistic decision, this is mud-in-your-eye. The writer is essentially saying, in my opinion, 'I can't have it, damned if I'm giving it back to the government. and what a pity it'll be if what gets donated is just pennies after the big tax'.
I don't have any issues with pay for performance and don't care how much the comp is if its earned - check the competing story today on hedge fund payouts in 08 for the best performers. But when you are a member of a group and a company that damn near imploded the global economy, you don't deserve a dime no matter how well you did individually. The sentiments expressed in the letter effectively dismiss the poor performance of the rest of the group as "not my problem". AIG was notorious for an aggressive, me-first mentality and I think that's clearly on display in this letter.
I appreciate he feels maligned by the publicity and vote seeking AGs of CT and NY and sold out by his own CEO (who was brought in to clean up the mess and thus really owes no duty of loyalty to the old guard at A.I.G.) and he and his peers have been unfairly persecuted by politicians seeking to improve their popularity ratings and garner future votes. I'm sure it really bites to give back $750,000 but my guess is he's done well enough that it won't cause him to move into a cardboard box any time soon. His outrage almost matches that of Congress. Both are more than a bit hypocritical.
In fact, as I've said in other posts, it's time to let AIG fail. It's been staggering like a cartoon boxer for a year. Vultures have had plenty of time to size up which pieces they want and are just waiting for the carcas to drop. They have no incentive to overpay and A.I.G., as long as the government stands behind it, has no incentive to drop its prices. I am not as informed as the Fed Chairman or the Secretary of the Treasury but I wouldn't be surprised if the market absorbed AIG rather effortlessly if it were allowed to fail now. It's time to move on.
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