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|October 20, 2008|
Reports that AIG fat cats celebrated America’s painful trillion dollar bailout of their misconduct with a nearly half-million dollar weekend retreat at a plush California spa has outraged the nation. The idea that our legislators as well as our men and women on main street convulsed for two weeks while their wealth diminished by billions of dollars at high velocity should never have been the cause for a lavish, high-fiving free-for-all on the golf course and massage tables by AIG executives.
Then, even as congressional investigators railed about the excess, as even more billions in bailout were required, it was learned that yet another lavish AIG event was in the offing. It seems partying big-time is a corporate habit at AIG.
Now, stung by an investigation by New York Attorney General Andrew Cuomo, the insurance conglomerate has agreed to cancel 160 more of these lavish conferences and events. Some exceed $750,000 per event, for a total savings of $8 million. Here are some examples of the cancelled events and why one to two generations of taxpayers will have to suffer deficits. A “best operator” conference scheduled for Las Vegas was expected to cost $750,000. A risk management conference scheduled for this month—not at the Holiday Inn but at the Ritz Carlton in Half Moon Bay--was expected to cost $500,000. A sales conference at Sea Island scheduled for November, 2008, was projected at $350,000. A cozy little get-together in Scottsdale, AZ, was scheduled for 2009 to the tune of $190,000. These are just a few examples of your hard-earned, bailout dollars at work. This type of abuse of a publicly owned company with hundreds of thousands of devastated shareholders and millions of citizens worldwide who depend upon the liquidity of this insurance giant is certainly criminal.
Prosecutions, restitution, imprisonment and asset seizures are in order. The IRS should investigate whether the expenses for these past events were really ordinary and reasonable as corporate deductions, and whether they in fact constituted preferential dividends and income-based bonuses to the employees that must be reported and taxed.
Just as important, is for Americans to understand that it was their elected politicians who approved the bailout. In so doing, they showed the politicos were completely incapable of legislating an effective bailout. All AIG lobbying monies, direct and indirect, should immediately be disclosed and the money returned to the treasury. In addition, voters should remember the next time they go to the polls that their elected representatives and senators forgot to excise the Jacuzzi from the junk bonds. As other media commentators have urged, they should all be voted out of office; and once they are evicted, citizens should flood their lame duck e-mail boxes and phone lines with reminders why this was done.
If this country really needs change, change begins at home—in your neighborhood voting booth.