Two interesting nuggets today. First, in The Washington Post, a former AIG Financial Products official suggests the unit doesn't actually need to be so concerned with retaining personnel--because only a fraction of its employees are actually necessary now:
AIG, which received more than $170 billion in emergency federal aid, has become the chief exhibit for both sides of the debate. Executives say they must pay retention bonuses to keep employees who are unwinding its Financial Products division, which nearly brought down the insurance giant with trading in exotic derivatives.
But a former senior Financial Products executive who spent eight years at the firm disagreed. Because the division is shrinking and no longer seeking new business, many workers have lost their relevance. The only key positions are employees who are working to extricate AIG from $2 trillion worth of outstanding contracts, the executive said.
"The guys who are getting paid all the big money are not really the ones who are important to the company," he said.
It's obviously tough to evaluate that claim without knowing who was getting what.
Second, the Journal reports that the administration is now exploring how it might use the executive pay portion of the stimulus bill to recover the bonuses:
White House officials are looking to use an executive-pay provision inserted into the recently passed stimulus law. It has seized on language that would allow the Treasury secretary to claw back payments if they were "inconsistent with the purpose" of the Troubled Asset Relief Program or "otherwise contrary to public interest."
No indication of how realistic this is...