Marcus's argument doesn't even make sense: "The worst malefactors at AIG are gone. The new top management isn't taking bonuses." Well, then, it looks like people aren't mad at the new top management; they're mad at the malefactors who stuck around. Which is the truth: the people who sunk this company and threatened to destroy the world's finance system are collecting bonuses for a job poorly done. I can't think of any system in which that's fair.

And even the banksters themselves see it as free money:

As for another set of partyers, the New York investment bankers whose once-hefty bonuses may have significantly diminished in recent months, "instead of having the $10,000 to $15,000 to spend on a Saturday afternoon, they might spend $2,000 to $3,000," Mr. Laba said. "Which is fine."[...]

Whatever diversion these afternoons bring, some acknowledged that the sight of the young well-to-do partying hard when many financial firms are being castigated for profligate spending could appear embarrassing.

A man who works in finance and was standing near the bar of Merkato 55 the following Saturday started to talk about this issue, but then he had second thoughts, saying he could be fired for drawing attention to the subject in the news media. Any overt display of conspicuous spending, he added, even if not a dime was expensed to a corporate account, would not sit well with his employer. "Excess," he said, "is frowned upon heavily."

As for how he and his fellow Wall Streeters could still afford such afternoons, he said: "We all made so much money in the past five years, it doesn't matter."

A 29-year-old man who works for a large investment management firm and was at Bagatelle's brunch one recent Saturday and at Merkato 55's the next, put it another way: "If you'd asked me in October, I'd say it'd be a different situation, and I don't think I'd be here. Then the government gave us $10 billion."

Then Ruth Marcus deigns to make the pseudo-legal argument against rescinding those bonuses:

Remember, the contracts were negotiated long before the government put a cent into AIG. "The plan was implemented because there was a significant risk of departures among employees at [the company]," AIG wrote in a paper explaining the plan, "and given the $2.7 trillion of derivative positions at [the company] at that time, retention incentives appeared to be in the best interest of all of AIG's stakeholders."

And federal legislation explicitly states that compensation limits for companies receiving bailout funds do not apply to preexisting contracts. Not to mention that the existence of the retention bonuses has been known for more than a year.

"That was then and this is now" is not a valid legal principle. "We are a country of law," Obama economic adviser Lawrence Summers said Sunday. "There are contracts. The government cannot just abrogate contracts." He was right.

Because, of course, no one in America has ever had pay for work they've already done arbitrarily reduced.

But what makes her statement even more obviously a substitute for outright worship of the rich and famous is her rather, to put this gently, inconsistent views on the rule of law. Glenn Greenwald, an attorney by trade, explains how easy it would be to have a court rule to change the contracts. Legally. But a couple of months ago, Ruth Marcus had this to say on why the rule of law should be thrown away in order to let war criminals from the Bush administration go unpunished:

In the current unspooling, I unexpectedly find myself more in the camp of Reagan than Nields. I understand -- I even share -- Nields's anger over the insult to the rule of law. Yet I'm coming to the conclusion that what's most crucial here is ensuring that these mistakes are not repeated. In the end, that may be more important than punishing those who acted wrongly in pursuit of what they thought was right.

She even acknowledges that her position is an "insult to the rule of law" when it comes to letting powerful people off the hook when it comes to actual war crimes they committed. But when it comes to contracts that give rich people money, contracts that could be legally broken, she suddenly becomes Ms. Sound and Fury about the US being "a country of laws."

It obvious that the rules of logic don't apply in Ruth Marcus's universe. The only rule she respects when writing a column is how best to placate the peasants so they don't get too mad at the nobility doing pretty much whatever it wants to do.

Is this the role of journalism in a free society? Should they really be tut-tutting people who don't have much power to protect the interests of people with power? It would be interesting to read Ruth Marcus's response to that.