“Does anybody really know where all the AIG money goes?”
I doubt it. And it is an important point from another poster that by funneling the money through AIG, AIG gets restrictions put on itself but the final recipient has no accountability at all to us. It is curious that Congress feels it should micro-manage the American society but this bill basically gave carte blanc to AIG.
I agree with you that AIG should not have been bailed out in the first place, at least not the way it happened. Wouldn’t bankruptcy forced AIG to prove exactly what money they owed to whom? If that had happened, there would be time to consider how urgent it was to give AIG billions. The way it happened, Paulson went to the senate and said, “Give me $700B now, and just trust me.... or else!” And a solid majority from both parties did what he said.
And AFAIK, we still don’t know how much AIG is going to owe.
BTW, as I understand it, Obama’s deficit estimates assume that they recover 100% of the bailout money (TARP + other payments from the treasury). I don’t know if they are stupid or dishonest, or both.