[xcamel]

Duplicate Thread Tax

http://www.freerepublic.com/focus/f-chat/2172038/posts

[Wally_Kalbacken]

"Hank" Greenberg, AIG insurance group

Now aged 83, Hank - AKA Maurice - was the boss of AIG. He built the business into the world's biggest insurer. AIG had a vast business in credit default swaps and therefore a huge exposure to a residential mortgage crisis. When AIG's own credit-rating was cut, it faced a liquidity crisis and needed an $85bn (£47bn then) bail out from the US government to avoid collapse and avert the crisis its collapse would have caused. It later needed many more billions from the US treasury and the Fed, but that did not stop senior AIG executives taking themselves off for a few lavish trips, including a $444,000 golf and spa retreat in California and an $86,000 hunting expedition to England. "Have you heard of anything more outrageous?" said Elijah Cummings, a Democratic congressman from Maryland. "They were getting their manicures, their facials, pedicures, massages while the American people were footing the bill."

And they call this journalism? While I'm sure it was true that AIG spent a bundle on similar functions when Greenberg was still in charge of AIG - when it was entirely their prerogative to spend what they wanted as long as the shareholders didn't object -someone didn't notice that Greenberg was forced out of AIG by Elliot Spitzer, then AG for NY State. When the "billions from the US treasury and the Fed" arrived - it's not insignificant to note that they arrived in the form of a secured loan - secured with first priority pledges of assets held by AIG which were not immediately liquid. The essence of the AIG loan was a bridge loan, a secured bridge loan, which will allow AIG to liquidate assets over a period of about one year. These are simple, publicly available facts - and yet the journalists who cover this stuff take those facts and generalize them to the point of creating disinformation. Argue about the wisdom of supplying AIG with a secured loan, but don't call it a bailout (which implies a grant) and get off the high horse about the expenditures. If a bank had made a secured loan to AIG - they would not gain veto power over the AIG budget for sales conferences and perks like Spa treatments.