Never mind an 8.1 percent unemployment rate. We can handle a global mini-depression. Eviscerated 401(k) plans, trillion-dollar deficits and wars in two distant countries be damned. It is $165 million in bonuses to some executives of a company called AIG that brings froth to the lips of American taxpayers and visions of pitchforks to the punditocracy.
Laugh or cry?
I vote for laugh.
But first, the cry scenario: In the great pox upon today's global economy, the AIG bonuses are but a pustule — unsightly, unhealthy, but superficial. The sums are trivial; the actual consequences negligible. There are bigger fiscal fish to fry.
The absurdity and inequity of paying out "bonuses" with taxpayer dollars to executives in a house of evildoers is palpable and needs no elaboration. The reaction has been over the top and somewhat random, as scapegoating always is.
One of the country's remaining distinguished dailies, The Washington Post, hyperbolically topped a story about the politics of AIG with the uberheadline "An Imperiled Agenda" — as if this food fight is going to undermine the 44th president. Nonsense.
But no one can top the senior senator from Iowa, Charles Grassley, for nailing the zeitgeist. "I would suggest the first thing that would make me feel a little bit better toward them [would be] if they'd follow the Japanese example and come before the American people and take that deep bow and say, 'I'm sorry,' and then either do one of two things: resign or go commit suicide," Grassley said.
Apparently death threats and other vile offerings have been flooding AIG inboxes and phone systems. This ugliness is what makes us want to cry. As craven as the particulars may be here, these bonuses didn't cause the meltdown and are no more unjust than a hundred other outrages one could select. This is similar, but nastier, to the episode when the automobile execs flew their private jets to a congressional hearing concerned with bailing out their companies. This is a legitimate, but overblown and vicious random act of outrage.
But here's why it's OK to laugh: The hideous reaction to these hideous bonuses might be big enough to constrain some future boardroom behavior — maybe.
For those animated by the pursuit of wealth, it takes a lot of superego agitation to override the acquisition instinct. Various forms of shame can do that: At some point, money may not trump embarrassment. That point, judging by the recent behavior of our moguls, appears to be rather distant.
But tipping points exist, or so the book says. Maybe the AIG bonuses will be a tipping point that helps inhibit future executive behavior in a small number of cases. Then maybe the scapegoating and vitriol will have a purpose.
My pet moral theory about the Crash of '08 is that it was lubricated by the silent, small decisions to look away from discrete improprieties and recklessness by hundreds of thousands of well-educated and highly trained accountants, lawyers, MBAs, bond traders, board members, attorneys and regulators. Public floggings, no matter whether they're nasty or irrational, can influence that sort of passive behavior.
With that in mind, I'm good with storming the USS American International Group under cover of darkness and throwing their bonuses into Boston Harbor.