When outrage fatigue sets in
A strange thing happened the other day. A radio producer called me up seeking some outrage over this AIG thing, those millions of dollars in bonuses handed out even as billions in taxpayer cash flooded in to keep the insurance giant afloat.
“I imagine you’re pretty worked up,” the producer said hopefully.
In fact, I wasn’t (which was why I didn’t end up on that particular show). So the financial services industry placed personal greed ahead of public interest. What else is new?
That’s when I realized: Outrage fatigue had set in.
Don’t get me wrong -- plenty of taxpayers are totally cheesed. “I can’t believe the nerve of AIG,” declared Monrovia resident Dan Lafferty, 46, one of two dozen or so people I chatted with around downtown Los Angeles on Tuesday.
But many others, like me, are having a hard time getting steamed after months of increasingly outrageous outrages.
“That’s probably right,” said Robert E. McNulty, director of programs at the Center for Business Ethics at Bentley University in Massachusetts. “After a certain number of scandals, people just start saying, ‘Ho-hum, what’s next?’ ”
I remember the last time American International Group Inc. was caught with its ethical compass out of whack. This was in October, when it came to light that AIG execs had headed to the St. Regis Resort in Monarch Beach for a week of spa treatments and golf outings just days after the company received $85 billion in bailout cash.
Since then, the amount of taxpayer money pumped into AIG has more than doubled. Yet now the company is shamelessly doling out $165 million in bonuses to its execs -- in some cases, to the very people who brought the company to the brink of collapse by insuring the crappy investments other Wall Street heavyweights were making.
I have to shake my head in awe at the brazenness of these guys, just as I did when we learned recently that Merrill Lynch & Co. handed out $3.6 billion in bonuses just days before the company’s sale to Bank of America Corp.
Or when it was reported that BofA’s chief executive, Kenneth Lewis, received almost $10 million in compensation last year -- the same year the company performed so poorly that it required $45 billion in bailout cash from taxpayers.
Or when it was revealed that Citigroup CEO Vikram Pandit received almost $11 million in compensation last year. Like BofA, Citi had to be propped up with $45 billion in bailout money.
Angry? I suppose I am. But the arrogance of these guys is so enormous, I hardly know where to begin focusing my outrage.
“It’s like watching TV news,” agreed L.A. resident Bill Doyle, 44, one of those I encountered in my downtown wanderings Tuesday. “After a while, the body count numbs you a little.”
This sentiment was shared by Donte Collins, 34, who told me he’s between jobs right now as he recovers from a drive-by shooting (you gotta love this town). “It’s the same thing every time I open the newspaper,” he said. “At this point, I just want to see something different.”
Bentley University’s McNulty says the hundreds of billions of dollars involved in the bailout have made it difficult for many people to relate to the ongoing scandals.
“We’re dealing with numbers of such a magnitude, they’re no longer comprehensible,” he said. “It all becomes blurry.”
It doesn’t help that political leaders, including President Obama, have sensationalized the situation by saying they’re shocked, shocked to discover that Wall Street execs think only about self-enrichment.
Wasn’t it Obama’s Treasury secretary, Timothy F. Geithner, who negotiated these deals with AIG? It’s not like the administration didn’t see this coming.
The prize for over-the-top political theatrics goes to Sen. Charles E. Grassley, an Iowa Republican, who said Monday that AIG execs should consider killing themselves.
“The first thing that would make me feel a little bit better toward them [is] 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.
AIG responded by calling the remark “disappointing.”
Many in Washington are demanding that AIG rescind the bonuses. Easier said than done, considering that the company was contractually bound to make most of the payments.
“The thing that really troubles me is not that we’ve reached outrage fatigue but that we weren’t outraged enough before all this happened,” McNulty said.
He pointed out that for a while, everyone was outraged that companies were backdating stock options to make them more lucrative for execs. “Then there was so much of it that people just stopped paying attention.”
That’s the real danger here. The scope of the outrages emerging from this financial mess is so gargantuan, it will become increasingly difficult to stir us from our scandal-induced stupor.
It’s already so bad that I’ll bet many of you didn’t even bat an eye at Grassley’s comment. Even in jest, though, that’s a pretty horrible thing to say.
While prowling around downtown, I met David Jones, 46, who was sweeping the sidewalks and cleaning out gutters. He said he’d like to get a better job, but he got out of prison not too long ago and this was the best he could get.
As we chatted, I observed that he’d paid his debt to society, but the guys on Wall Street who got us into this fiasco will probably all get away with it -- and with bonuses to boot. Surely that was worth a little outrage.
Jones shrugged as he pushed his cart along the sidewalk.
“It’s not worth it,” he said. “All you can do is go about your business.”
David Lazarus’ column runs Wednesdays and Sundays. Send your tips or feedback to email@example.com.