While the troubled insurance giant AIG is fulfilling contractual obligations in doling out $165,000,000 in bonuses, it is getting it clocked cleaned by politicians on both sides of the aisle.
And while the political class is piling on AIG from President Obama down to the most insignificant congressman, there needs to be a little bit of standing back to see where the mess started and how you and I-the American taxpayer-are on the hook for $173,000,000,000 and counting to "bailout" AIG.
This editorial in today's Wall Street Journal is a great place to start.
What we find out is that a lot of politicians were involved in the beginning of this mess.
In 2005, the former and disgraced New York governor, Elliot Spitzer, forced the former AIG Chair, Hank Greenberg, out. Once Mr. Greenberg was ousted, the AAA rating that AIG had went out the window and, like many an American bank, they got in on the housing market and put all its eggs in that basket.
Oh, and despite what you will read in the Dinosaur, Drive-By, Mainstream, Obama-Worshiping Media, there was a lot of government oversight on AIG. They were going down with a lot of regulators watching and saying "no problem" even though there were many problems. Scott Polakoff of the Office of Thrift Supervision said that his agency and a "college" of international regulators were supposed to be keeping AIG in line. Why it was state, federal and even international regulators were keeping their eye on AIG.
Do you want to know the real outrage? I will write that it is not $165,000,000 in bonuses being doled out. The real outrage that in the dead of a Sunday night, the world finds out that at least $120,000,000,000 of the money that you and I have given to AIG has gone to such people as American municipalities, American banks and European banks and derivative counterparties. But, and astounding $13,000,000,000 went to Goldman Sachs. Goldman Sachs? Why I thought that Goldman Sachs people would solve all of our problems. That is where the previous Treasury Secretary, Henry Paulson, came from. And the current boy wonder, Tax Cheat Timmy Geithner, is also from Goldman Sachs.
And if you think that is not an outrage, consider this.
Connecticut Democrat senator, Christopher Dodd, protected these bonuses that have the political class ready to tear down the gates to AIG. But, wait, there's more! It appears that Sen. Dodd then proposed to tax the very bonuses that he protected in the original $767,000,000,000 so-called economic "stimulus" bill. Oh, as a side note, Sen. Dodd was the largest senate recipient of donations from AIG at $103,100.
So, those who want to slam the $165,000,000 in bonuses that have been already doled out need to look at the very political class that really created this mess to begin with.
This paragraph from the Wall Street Journal editorial says it all:
Given that the government has never defined "systemic risk," we're also starting to wonder exactly which system American taxpayers are paying to protect. It's not capitalism, in which risk-takers suffer the consequences of bad decisions. And in some cases it's not even American. The U.S. government is now in the business of distributing foreign aid to offshore financiers, laundered through a once-great American company.