I know you thought Jack Welch had faded away. We did. Sure, he'd appear at this or that conference. Make a speech here or there. But we were kind of convinced that he had a body double doing all this work while he played bridge at the secret Welch Hideaway Compound. Well, that was until his appearance last night with Larry Kudlow when the guy who gave us Jeffrey R. Immelt poured out his heart. He had some not-so-kind words for the new "owners" of AIG:
KUDLOW: Geithner and his group should have called Liddy down to Washington. I don't understand this. And just sat him down and say, okay, here is the way life works. Here's the way it's going to work. Is that what you're saying?
WELCH: It should have been resolved between Liddy and the Treasury, or the Fed, or whoever it is that represents the US government who is the owner of AIG! The idea that these guys who own it, can now all throw rocks at it, makes no sense. It would be like a board of directors throwing rocks from the outside and not being responsible.
Jack makes a good point. The government has always seemed to believe that owning a majority stake of common somehow grants them some sort of mystical micromanaging power over individual salaries and operational details that would make a Chancery Court puke. Are all these lawmakers just this clueless about corporate governance? Or is the current outrage really just populist pandering? Given that the details of AIG bonuses have been public and in front of Congress for quite some time and this bit of outrage is so sudden and violent, we think the latter.
An Interview With Jack Welch [CNBC]