Pay czar: AIG bonuses are ‘outrageous’ but legal
Bonus payments totaling $100 million to AIG employees from the same unit that prompted a massive taxpayer bailout are “outrageous” but allowed under the law, the Obama administration’s pay czar said Wednesday.
Kenneth Feinberg said the retention bonuses were contractual obligations agreed upon years ago, before American International Group Inc. received a $180 billion federal rescue at the height of the financial crisis in late 2008.
“These are the old grandfathered payments,” Feinberg told ABC’s “Good Morning America,” adding: “I do not for a minute ignore the outrage out there, which I share. But the fact of the matter is we’ve got to abide by the law.”
Feinberg said he’s working to get back as much of the bonus money as possible. He said AIG employees have agreed to repay 39 million out of $45 million in previous bonuses to the U.S. Treasury. [Read the full article]
Key Democrats and Republicans neared agreement Wednesday on plans to give businesses a tax break for hiring unemployed workers, a rare glimmer of bipartisanship in Congress that could hand President Barack Obama a badly needed political victory.
The measure is an alternative to Obama’s proposed tax cut of up to $5,000 for each new worker that employers hire. Obama’s plan ran into opposition from some House Democrats skeptical whether employers will hire because of a tax break.
The Senate alternative would exempt companies from paying the employer’s share of Social Security payroll taxes for new workers hired this year, as long as those people had been unemployed at least 60 days. It could pass the Senate as early as next week.
Both measures are aimed at providing private businesses an incentive to hire some of the 7 million Americans who have lost their jobs in the recession. [Read the full article]
Chancellor Angela Merkel’s new government marks 100 strife-filled days in office Thursday in a defensive mood, with a nervous eye on an upcoming state election that could hamper the German leader’s ability to set the agenda for Europe’s biggest economy.
Merkel’s center-right government took office Oct. 28, replacing a four-year-old “grand coalition” with her main rivals on the left. The conservative’s coalition with the pro-business Free Democrats, an alliance of choice rather than necessity, was meant to focus on the challenge of boosting economic growth.
“I have no illusions: this won’t be an easy parliamentary term,” Merkel said recently as she looked forward to the tasks her government faces. [Read the full article]
The Arizona House plans Thursday to consider Gov. Jan Brewer’s proposed sales tax increase and other budget-balancing legislation approved by the Senate, with concerns over a separate bill on business tax relief helping put the outcome in question.
The Senate approved the budget package and sent it to the House on Tuesday, the second day of a special session called by Brewer.
The package had both bipartisan support and bipartisan opposition in the Senate, and the resolution to put Brewer’s proposed three-year, one-cent sales tax increase on a May 19 special election ballot was approved with the bare minimum number of votes needed.
It also will take bipartisan support in the House to approve the sales-tax referral, s