The Phony AIG Bonus Scandal Outrage

It is a sign of short-term thinking.

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A few thoughts:

1) So Geither is supposed to go after the AIG bonuses. It's is not like he doesn't have a pretty full plate as it is. I mean, he's usually pictured these days as being like the Maytag Repairman, all alone over at Treasury, his voice echoing in the hallways as he searches for help. But all he finds are empty offices of withdrawn nominees;

2) As both Andrew Ross Sorkin and Jim Manzi have pointed out, who is supposed to unwind all these complex derivatives? The hard truth is probably the same guys that put them together. It's like after WWII when America got all those Nazi rocket scientists. Now they're working for us;

3) Rather than being outraged over the bonuses, maybe people should be furious that billions in taxpayer dollars are going to foreign banks. That would have been a nice topic to discuss at the G20 meeting, yes?. This is something Team Obama does not want to talk about;

4)  Now there is word that Wall Street firms are scrambling to sidestep pay restrictions that come with accepting government dough. Maybe they will raise base pay, which, of course, defeats the whole idea of pay for performance. More government rules also mean more effort to sidestep them, as people did with tax shelters back in the 1970s. Unintended consequences, my friends.