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A.I.G. again?

November 10, 2008

aig-exterior-medIs any one concerned that we are giving another $40 billion to AIG to keep them from once again collapsing?  It’s starting to feel like we are getting played by AIG.  Yet, on the other hand we are having hard core discussions about bailing out the auto industries?  Something seems wrong with this picture.  On the one hand I agree we need to make the auto industry commit to making cars that are more green before giving them a substantial sum of money.  But the standard, if any, we have set for AIG seems very weak.  This is the third bailout we have given them.  When does AIG have to meet a set of standards that is aggressive enough that this kind of repeat bailout does not keep taking place?

The enhanced bailout plan — nearly double the original $85 billion loan extended to the company in September — comes with restrictions on how much AIG corporate executives get paid. The top 5 executives at the company are now subject to salary and bonus limits that are the most stringent the Treasury has yet struck in any financial bailout plan. The next 70 highest corporate officials are subject to the same limits on severance packages as other executives of companies participating in the $750 billion Troubled Asset Relief Program. AIG’s overall bonus pool is frozen at 2006-2007 levels.

AIG chairman and chief executive Edward M. Liddy said the new plan “addresses the liquidity issues that threatened AIG,” and that the company’s “goal is to repay taxpayers in full with interest.”

I’m glad that CEO Liddy plans to pay the American people back, but when do they stop bleeding cash and looking for more hand outs?  The fact that AIG have frozen bonus levels would be a plus if it was not related to 2006-2007 levels which are still bonus levels that supersede what the average person makes in a year.

Read the full story here.

Enough said.

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One comment

  1. yeah, great theme.

    http://culturedecoded.wordpress.com/2008/11/09/gopandthepress/



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