Sorry, but I do not blame AIG for this debacle and the recklessness with which taxpayer monies have been handled.
Below is a letter I wrote to my congressman and my senator regarding my feelings on the entire issue.
Oh yes, and I also sent the letter to President Obama.
Dear Congressman Donnelly and Senator Bayh,
The news divulging the payment of bonuses to top AIG executives is available to the public on the internet. I cannot begin to tell you how outraged I am with my government at this moment.
I AM NOT ANGRY WITH AIG. The U.S. Treasury gave them bailout funds without any conditions. AIG was free to do with those bailout funds as it pleased – and it did.
As an accountant, a former bank auditor, and a taxpayer, I am angry with The U.S. Treasury for its lack of common sense financial skills
When a company goes to a bank seeking a loan, it must give the bank a balance sheet, income statement, tax returns, cash flow statements, listings of its executive management team, and if incorporated, a list of board members. This company must also inform the bank of the intent of the use of the funds, whether it is to purchase equipment, inventory, or for working capital. The bank will also conduct an interview with the financial manager and the president, and will inspect the physical location(s) of the company to confirm that everything is there as claimed by the company. The bank reviews all the information and decides whether to grant funds to the company or not. If the request is granted, the loan from the bank MUST BE USED for the purpose the company indicated on its bank loan application, and any assets owned by the company will be used as collateral by the bank to secure the loan proceeds.
When a consumer goes to a bank requesting a loan for a car or home, credit reports on the individual must be reviewed along with those legal documents necessary to securitize the loan whether it is a vehicle or house title.
The U. S. Treasury gave out taxpayer money to a corporate conglomerate with no scruples. There were NO REVIEWS done of any kind to determine the scope of the financial crisis of AIG or any of the investment banks that created financial havoc on our economy. To add to the lack of review of these investment banks, the U. S. Treasury gave them taxpayer dollars with NO CONDITIONS on the use of those funds. It is not surprising that due to the carelessness of The U.S. Treasury that we find ourselves in the present circumstances.
If AIG had been forced to file for bankruptcy, a bankruptcy judge would have nullified, delayed, or reduced the contractual executive bonus payouts.
The U. S. Treasury did nothing other than hand over our taxpayer dollars to a corporate conglomerate with no scruples. As far as I am concerned, The U.S. Treasury only made the executives of AIG richer and left the U.S. taxpayers out in the cold with its careless, reckless manner of handling bailout funds.
I cannot begin to express my sense of outrage with all of you for your carelessness and your lack of foresight in not predicting the behavior of the investment banks given where they already were.
Sincerely,