The famous Harvard-based economist Professor Martin Feldstein is on the board of the American insurer AIG that received $200 billion in handouts from the US government and which has just paid over $160 million in bonuses mainly to those managers responsible for its massive financial failure. The bonuses were 'justified' by AIG as retention bonuses designed to retain staff although 11 executives paid the bonuses quit AIG anyway.
Feldstein is a conservative Reagan-backer who is now a member of Obama's 'economic recovery team'. Gulp. A great man - Feldstein has won all sorts of awards and is still prospering.
(Feldstein's Harvard colleague Greg Mankiw argues that Americans shouldn't worry about the bonuses to AIG - they are only 0.001% of annual GDP anyway. On this basis every criminal in the US justice system should be released from jail. Disagree with you Greg and more than just emphatically. Like Feldstein, Mankiw is one of those nominally skilled economists in the US universities who has no sense of the deep dilemmas that confront the US. Mankiw has learned a little but his intelligence here does not roam beyond the glib and the cute. His views on this issue illustrate the poverty of academic sensibilities in US universities).