AIG Spa, AIG Retreat, AIG Party, AIG Vacation, American Taxpayers Scammed?
Yesterday the House Committee on Government Oversight and Reform headed by Henry Waxman (D-Cal) began inquiries into why Lehman Brothers and AIG failed, an inquiry that by rights should have preceded the spending of a single taxpayer cent to bail out AIG and save it from the fate met by Lehman Brothers.
Instead, taxpayer funds rescued AIG executives from the natural consequences of their financial mismanagement. They responded in their typical, fiscally irresponsible manner, treating 70 AIG executives and employees to a week at St. Regis Resort in Monarch Beach, California, according to the Washington Post. The spa bill alone was $23,000. Meals for those 70 AIG executives and employees for a week cost another $120,000, an average of $244 per person per day for meals or $81 per meal per person. A typical American family doesn't spend as much as $244 per week feeding their families.
In his opening statement, Waxman said of the similarity between the Lehman Brothers and AIG failures, "the companies and their executives grew rich by taking on excessive risk. In each case, the companies collapsed when these risks turned bad. And in each case, their executives are walking away with millions of dollars while taxpayers are stuck with billions of dollars in costs."
Joseph Cassano, the former AIG financial products chief who is widely believed to have played an instrumental role in the company's downfall by engaging in risky transactions and resigned in March, continues to be paid $1 million per month from AIG as an advisor.
After failing to closely examine the causes for AIG's failure or limit spending by AIG in approving an $85 billion bailout, the Congress approved a $700 billion bailout for other yet to be identified failing Wall St. firms, again without advance scrutiny of the causes or spending limitations.
Both Presidential candidates pressed Congress to approve the $700 billion bailout bill without first assessing responsibility. The bailout bill did not include provisions holding corporate executives who drained the Wall St. firms of their wealth accountable.
Yesterday, the Fed promised to buy up $1.3 trillion in commercial short term debt, in effect becoming a direct lender to the troubled financial industry. Half of the short term commercial paper the Federal Reserve proposed to buy is property of floundering financial firms which can't find a market for its short-term debt elsewhere.
In last night's debate, Republican Presidential candidate John McCain proposed that the U.S. government buy up the nation's troubled mortgages and rewrite their terms.
As the financial news continues to worsen and the United States government continues to take the hit on bad investments made by multimillionaire executives who are walking away unscathed, one can't help but worry how much bad debt can one government hold before being crushed under its weight?
Sources: http://www.washingtonpost.com/wp-dyn/content/article/2008/10/07/AR2008100702604.html; http://www.bloomberg.com/apps/news?pid=20601103&sid=aOIwMdX.6IBc&refer=us; http://www.npr.org/templates/story/story.php?storyId=95169727; http://oversight.house.gov/story.asp?ID=2214; http://www.latimes.com/business/la-fi-bailout8-2008oct08,0,822022.story.
Published by Carol Bengle Gilbert - Featured Contributor in Travel and Lifestyle
2010 Yahoo! Outstanding Contributor of the Year, Carol has consistently been designated a Top 100 Yahoo! Contributor Network writer. She received a 2008 People's Media Award for "Best Article." Web writing... View profile
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36 Comments
Post a CommentWhy is anyone surprised? Our country was founded on corruption and evil, starting with the genocide of the American Indian. I was born here and I pay my taxes every year but I plan to move out of this awful country as soon as I am financially able because I cannot, with clear conscience, continue to give my hard-earned money to the government, knowing that it will be put in the wallet of some extremely wealthy corrupt person who got their wealth by screwing me (and other honest American citizens) over in the first place. If you want to know more about this scandal, rent INSIDE JOB; probably the most comprehensive documentary on the subject. I wish we could overthrow the goverment and start over. I'm 39 years old and highly educated and all I've seen in my lifetime in regards to the US government has been negative; wasteful spending, the absence of healthcare, bailouts, unnecessary wars, etc. This bailout is just another story to add to the history books of the United States of Corruption.
Believe me, when the guys were gone, their wives were being "taken care of"
Very true. Welfare for the wealthy. A fine Republican policy.
I think these executives should have to struggle to pay the mortgage on a three bedroom ranch house just like the rest of us before Congress bails them ou.
Great reporting! They talked about it on TV and an AIG bigwig asserted that canceling the upcoming retreat was really detrimental to employee morale. Somehow, I just couldn't get myself to feel real sorry for them...
A bullet between the eyes would be to kind. Send all of them on a one way trip to Iraq.
I am mad as hell. And I am writing to my congressman, senator and anyone else who is suppose to be looking out for my best interest. And if that doesn't work, I guess I will march. Did it in the 60's, might be time to dust off my protest shoes. Even if I am out there alone, at least I not just sitting around complaining.
This is ABSOLUTELY sickening! I want my MONEY back!!! Our government needs to take back that $85 Billion and let that miserable organization suffer the fate it deserves for mismanagement it. "Joseph Cassano, the former AIG financial products chief who is widely believed to have played an instrumental role in the company's downfall by engaging in risky transactions and resigned in March, continues to be paid $1 million per month from AIG as an advisor." this idiot needs to be fired and should have to pay back all of his bonuses and payouts. This is just disgusting!
BCL: You're right! Publish their home addresses and phone numbers so someone can put a bullet in their heads. I'm tired of this corporate greed. But don't get me wrong I believe in capitolism but RESPONSIBLE CAPITALISM!
I live 20 minutes from the ST. Regis Hotel and would have LOVED to show up there and crash their party!
Unbelievable. I'm glad they canceled their upcoming visit to a Ritz Carlton, although, they'll be charged with cancellation fees and wonder how much those will be. Maybe we can all write-off spa time on our 2008 taxes :)
THOSE IDIOTS SHOULD BE MADE TO PAY ALL OF THAT MONEY BACK. ALL OF THOSE ELECTED PEOPLE SHOULD REMEMBER THEY WORK FOR US, THE TAXPAYER BUT INSTEAD THEY JUST KEEP TAKING ADVANTAGE OF US AND EARN X-LARGE SALARIES, WHY DON'T THEY TRY LIVING ON A FIXED INCOME LIKE SOCIAL SECURITY, THAT WILL NOT HAPPEN SINCE THEY ALL HAVE A SPECIAL RETIREMENT PLAN FOR THEMSELVES. GREEDY BASTARDS