Show Me the Money

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Published in New York Magazine November 27, 2009 by Gabriel Sherman

Shortly after 11:00 on the morning of November 4, Robert Benmosche, the 65-year-old Brooklyn-born CEO of the American International Group, sat across an oval conference table from Kenneth R. Feinberg, the special master for TARP executive compensation of the U.S. Treasury. Benmosche was flanked by AIG’s board of directors, which had requested that Feinberg come to the mahogany-paneled boardroom on the eighteenth floor of AIG’s Pine Street headquarters to explain himself. Light sandwiches and soda were served from a buffet in the hallway.
The mood was distinctly somber. Two weeks before, Feinberg had ruled that a dozen of AIG’s 25 highest-paid executives would have their 2009 income slashed by 91 percent and that salaries could not exceed $500,000 without “good cause.” About half of the executives on this list came from AIG Financial Products, the vilified trading division that had written the disastrous credit-default swaps that brought the civilized world to the brink and forced taxpayers to extend $182 billion (and counting) in financial support for the firm. Benmosche was deeply angry over Feinberg’s decision to limit his executives’ pay. But his traders were even angrier. Though the government had saved their company from imploding last September, they saw themselves as victims, scapegoats—and they were ready to fight back, departing en masse on March 16, 2010, the day after the contracts are due to be paid, if their demands weren’t met.

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