I'm watching this Congress versus AIG action on TV. It's fun to take in the outrage from the Barney Fifes of the economy. This is almost like a Brer Fox versus Brer Rabbit performance being exchanged. "Don't throw me into the TARP funds!!"
What gets me is that there's way too much talk about how Obama and Treasury Secretary Timothy Geithner somehow gave AIG all the billions.
There's a name missing from their list of folks who gave us this mess: Former US Treasury Secretary Hank Paulson
Where is Hank Paulson today? Why isn't he being dragged across the coals with his little bottle of water in his fingers? Hank set the trend of not caring how many bonuses these people can pass out. Hank was the one who came up with the bailout - yet somehow Congress and TV pundits have virtually forgotten he has a name. It's as if he was just a kid who was eliminated on American Idol's Hollywood week. The man set up this system. At least one guy at Forbes remembers Hank's brilliant plan.
http://www.forbes.com/...
The deal Greenberg struck was to give the AIG Financial Products executives 30% of the revenues from this operation, an enormous motivation to write as much business as they possibly could. Moreover, its holding company had no regular oversight by AIG's board and was not regulated by any government body. The compensation arrangements were then, and still are, a recipe for disaster. As we know, disaster struck.
Everybody wants to go after Geithner, but it is Hank that hammered out the deals and set the plate for AIG to keep feasting on the public tax dollars. Why isn't Hank getting screamed at today? Why isn't he explaining how a company that is rock bottom can give out performance bonuses?
Was this the reason why Greenberg wanted to put himself above the law in the original TARP "memo?" I won't even ask who Hank Greenberg had to screw to get out of this jam - because he has obviously screwed the American public as he opened up the vault to his wall street cronies.