AIG Claims “We Will Repay Taxpayers”
Dec. 22, 2008
by Senior Staff Editor Corey May
On September 16, 2008, the Fed came to the rescue of AIG (American International Group, Inc.) with an 85 billion dollar bail out.  Much controversy was spread around Wall Street as other companies began to put their hands out.  It was then that that the parameters of the bail out took the front stage as angry taxpayers reported disdain over the government interference.
Within a few days, the Feds also expanded the currency swap lines and established a program with the European Central Bank and the Swiss National Bank extending another 180 billion in credit into the system.  It was apparent that one collapse was capable of leading to others and the seas calmed as politicians pleaded to justify that they had no other choice but to bail out AIG.
In the midst of the controversy, AIG’s major US subsidiary American General spent nearly half a million dollars at the St. Regis Monarch Beach Resort in California including $200,000 on hotel rooms, $150,000 on banquets, $23,000 at the hotel spa, $1,400 at the hotel salon and $10,000 on leisure dining.  This was justified by using the attitude that during the tough times it was important to maintain status quo for the sake of the clients and the insured.
Last week Edward Liddy, Chief Operating Officer defended AIG’s activity at an interview at CNN.
“Anybody who wants to start an insurance company or beef up their position, they will come to our organization and pick people off,” Liddy said in the interview. “If that happens, we can’t maintain the businesses we want to keep and we won’t be able to sell them for the kinds of values that we need.”
According to Liddy, AIG would like to pay back $60 billion in 2009 by selling divisions, life insurance, retirement  services and private plane leasing. Representative Elijah Cummings (D Maryland), has requested that Liddy testify in a congressional hearing about the “full extent” of the company’s program to keep workers.
Representative Cummings maintains that AIG mislead the House Committee on Oversight and Government Reform.