"Lives in Danger" at AIG

Working for a vilified corporate titan is not easy these days, but for AIG execs Monday was a day they probably should have stayed at home. Death threats against employees, possible fresh subpoenas, indignation from lawmakers, and a vow from President Obama himself to make the taxpayers whole again all added to the public drama around the stricken insurer's controversial $165 million bonus payout. "It's a mob effect," a senior AIG executive told the Washington Post describing the level of public outrage directed at the company and its employees. "It's putting people's lives in danger."

The epicenter of the outrage Monday was Washington. Even though Treasury officials knew of the planned payout for months, they only voiced their indignation just as the checks were being cut over the past few days. President Obama added his outrage to the AIG bonus furor, vowing to "pursue every single legal avenue to block" the payouts. But, the Wall Street Journal reports, "hours later, administration officials said the payouts made Friday couldn't be extracted from their recipients without a legal fight that would cost the taxpayers even more." Shortly afterward, in stepped New York Attorney General Andrew Cuomo, who said "he would subpoena A.I.G. for the names, job descriptions and performance evaluations of the employees receiving the bonuses," the New York Times reports. The AIG bonus fiasco appears as if it will devolve into a matter of who knew what when. According to the NYT, Rep. Elijah E. Cummings of Maryland, a member of the House committee on government oversight, had been hounding AIG for additional details of the payouts for months, assuming all along the Treasury was also on the case. But Treasury Secretary Timothy Geithner only personally became aware of the March 15 bonus payout deadline last week, when it was too late to do much about it, the newspaper reports.

While all the attention is on AIG, Wall Street is putting its top minds to the task of finding fresh pay loopholes "to sidestep tough new federal caps on compensation," the WSJ reports. New TARP restrictions signed into law last month mean the top five executives of those firms that received bailout cash must forego bonuses. "In response to expected bonus restrictions, officials at Citigroup, Morgan Stanley, and other financial institutions that got government aid are discussing increasing base salaries for some executives and other top-producing employees," the newspaper reports, citing sources in the know. Meanwhile, Citigroup disclosed in a filing yesterday that CEO Vikram Pandit saw his salary increase nearly fourfold in 2008 to $958,333, Fortune reports—a far cry from his vow to award himself "$1 a year in salary until the bank returns to profitability."  All told, it was a good year for Pandit. His total compensation package topped $10.8 million, the magazine reports. It's a shame the share price has fallen 90 percent in the past year or the compensation could have been considerably higher.

The Obama administration is committed to saving both GM and Chrysler from bankruptcy, but that won't mean things return to badly run business as usual in Motor City. Instead, Obama's auto task force, headed by financier Steven Rattner, is looking to radically restructure both companies outside of Chapter 11. Rattner told the WSJ that bankruptcy "sometimes becomes a necessary place for some companies, but it's certainly not a desired place and it is certainly not our goal to see these companies in bankruptcy, particularly considering the consumer-facing nature of their businesses." This fresh approach comes as administration officials also said it doesn't plan to call in early the $17.4 billion in government loans given to GM and Chrysler, as they've already spent the money. Meanwhile, GM bondholders say they are working on a compromise plan to reduce GM’s debt after receiving a rebuke from Rattner who described them as being "quite difficult" in negotiations.

First went the Christian Science Monitor, and today a major U.S. daily newspaper, the Seattle Post-Intelligencer, cuts the paper bit out of its list of duties and moves purely online, the Los Angeles Times reports. The P-I's nearly 118,000 weekday subscribers are being switched to Seattle's only remaining daily paper, the Seattle Times, but it, too, is struggling financially. At least some old-school newspaper habits endure: As the Los Angeles Times writes, "The announcement was delivered Monday morning by Publisher Roger Oglesby to a shattered newsroom that—in classic P-I style—wiped back tears, broke out the whiskey and then went back to work."

And, finally, there's apparently no crisis for "pampered pooches." The WSJ reports on a novel marketing alliance that teams meatpacking giant Tyson Foods with Freshpet Co., a Secaucus, N.J., firm that is rolling out refrigerated dog food to thousands of stores across the country. The two firms will team up on "a product its executives think is recession-proof: deli-like food for pets," the WSJ writes. The idea is simple: Doting pet owners may skimp on themselves, but they won't trade down for the sake of their dogs.