AIG Bailout Repayment Plan Draws Criticism

Reps. Question CEO's Sell-Off Of Foreign Assets To Pay Back Government; Demand More Details

(AP)  The government-installed head of AIG told Congress Wednesday the insurance giant is selling many of its foreign assets to repay U.S. taxpayers, but lawmakers questioned whether the plan makes sense and demanded details.

American International Group Inc. Chief Executive Edward Liddy said the company has reduced, but not eliminated, the risk its failure could pose to the global economy despite getting more than $180 billion in federal bailout aid.

"The assurance I can give you is we will do everything we can to not require more federal money" but that will hinge on how long the worldwide recession drags on and the condition of the financial markets, Liddy said.

Liddy agreed to provide portions of AIG's "Project Destiny" restructuring plan to the House Oversight and Government Reform Committee, but said details are sensitive and could hurt the company's ability to sell assets.

"We will work with you to provide everything that we possibly can," Liddy told committee chairman Rep. Edolphus Towns, D-N.Y. Main Street Americans were angered over AIG's secrecy and its payment of millions in bonuses to employees, Towns said.

Congress needs "to understand what the long-range plan is for AIG," Towns said. He asked whether it made sense to sell off assets in a bear market where prices are depressed.

AIG on Monday announced plans to sell its Japanese headquarters to Nippon Life Insurance Co. for $1.2 billion in cash. The transaction is expected to close in the second quarter.

While AIG is working to divest assets, Liddy said, it doesn't intend to sell them at "fire-sale prices." The company plans to retain its U.S. property-casualty and foreign general insurance businesses, and a stake in its foreign life insurance operations.

"How long the plan will ultimately take will very much depend on how quickly and how strongly the global economy recovers," Liddy said. "Because we are all committed to ensuring that the mistakes of the past are not repeated, we must take the time and exercise the diligence to do this restructuring properly."

AIG was nearly destroyed last fall at the height of the financial crisis and became one in a string of corporate calamities and a touchstone for public outrage. The huge volume of credit default swaps - a form of insurance against bond defaults - sold by AIG, coupled with rising levels of defaulted mortgage and other debt, threatened the company's existence and prompted the government to step in.

Government aid to the company now totals $182.5 billion. The U.S. has taken a nearly 80 percent stake in New York-based AIG.

Liddy said the company has reduced its exposure to credit default swaps to $1.5 trillion, compared with the original amount of $2.7 trillion.

Also testifying at Wednesday's hearing were three trustees charged with overseeing the government's holding in AIG. They are seeking new board members for the company.

The $450 million in bonuses AIG paid to employees, including to traders in the financial products unit that brought it to the brink of collapse, fueled public and congressional outrage. The Democratic-led House approved a bill in March that would slap punishing taxes on big bonuses at AIG and other companies bailed out by taxpayers. The Senate didn't act on the plan, however.

[sjc_1]

Liddy was on 60 Minutes and said he took the job because he was asked to. He could have said no and continued with his retirement, but said yes to help fix one of the biggest messes that we have ever faced. Then Congress berates him when they should be going after the former CEOs and that deal maker in the U.K. No good deed goes unpunished.

[weedapoopl]

Barney said he was gonna get it back. Pelosi took her new jet to visit the plastic surgeon - and all was forgotten.
Posted by despido at 4:39 PM : May 13, 2009

I told you before - it was forgotten when it was revealed that Barney's buddies at Fannie Mae and Freddie Mac got exactly the same kind of executive retention bonuses, after they engaged in equally egregious mismanagement resulting in getting bailed out with our money.

Now AIG is back in the news, but Barney has been very very quiet ever since the story broke about Fannie and Freddie.

[despido]

"The $450 million in bonuses AIG paid to employees, including to traders in the financial products unit that brought it to the brink of collapse, fueled public and congressional outrage."

+++++++++++++++++++

That's funny - Timmy stated it was $186 million. Obama claimed he didn't even know about it, but approved it - but was outraged anyway. Barney said he was gonna get it back. Pelosi took her new jet to visit the plastic surgeon - and all was forgotten.

[whitemale08]

that will be getting bailed out offering to payback the government for using taxpayer money to bail them out with all of the programs that essentially reward their irresponsible behavior and mismanagement.
Posted by credibility2 at 1:48 PM : May 13, 2009 --

You must be living on the planet Mars or something.

Main St. is not getting bailed out at all, even the government 're-financiing' programs is another scam, lobbyed by the same bankrupt banks to re-package your mortgage and turn it into another 'security' and worthless credit-default swap.

Unless you understand how the markets work for worthless derivatives and credit-default swaps, then I suggest you do not post anything because all you are doing is repeating stooges like Druggie Limbaugh who are paid to deflect the blame from the greedy bankers on to Main St.

We needed jobs = We got credit instead = Big Banks needed bailed out

Those are the dots you need to connect my friend to understand the looting process.

[tincup356]

The government wants to continue owning companies that received bailouts by refusing to accept paybacks. The government doesn't want to lose any of its whipping objects. As a taxpayer I think the government would be foolish to ignore early paybacks from bailed out companies and be thankful they'll be getting our money back. I don't hear any folks on Main St. that will be getting bailed out offering to payback the government for using taxpayer money to bail them out with all of the programs that essentially reward their irresponsible behavior and mismanagement.
Posted by credibility2 at 1:48 PM : May 13, 2009 ,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,,
,,,,,,,,,,,,,,,,Who on main street is getting bailed out?......the only thing you will find on main street is a dollar glued to the ground with the government waiting for someone to bend over to pick it up.,,,,The bailouts and stimulus are ROBBERY.

[tincup356]

When will Americans figure out that congress will keep on giving these greedy rich corporations ALL the money they want,,,,congress has already been paid the bribes to do so through lobby dollars. Congress is committing TREASON against the people of this country,,,,,they took an oath to represent the people then took money under the table to betray us,,,,,,to heck with "Tea Parties" ,,,We need to revolt and take our country and tax dollars back from these white collar ,suit and tie terrorists that are robbing us with the blessings of congress.

[whitemale08]

PUT AIG INTO RECEIVERSHIP AND BANKRUPTCY RE-ORGANIZATION!

Then enforce anti-trust laws against all of these monopolies including Microsoft.

Right now MIcorsoft is 'TOO BIG TO FAIL'.

THIS IS RIDICULOUS....MONOPOLIES ARE TOO DANGEROUS TO AMERICA!

[credibility2]

The government wants to continue owning companies that received bailouts by refusing to accept paybacks. The government doesn't want to lose any of its whipping objects. As a taxpayer I think the government would be foolish to ignore early paybacks from bailed out companies and be thankful they'll be getting our money back. I don't hear any folks on Main St. that will be getting bailed out offering to payback the government for using taxpayer money to bail them out with all of the programs that essentially reward their irresponsible behavior and mismanagement.

[weedapoopl]

I HAVE A DREAM

I have a dream that one day the truth will set us free.

Free from the criminals in our government, free from the tyranny of the wealthy. I have a dream.

Oh, brothers and sisters, I have a dream that one day the people will see the politicians for the criminals that they are, the Democrats and Republicans alike. I have a dream!

I have a dream that one day all the people of our great nation will grow to hate the Democrats the way they have already grown to hate the Republicans HALLELLUJAH! Can I hear an amen! AMEN! I HAVE A DREAM!

I have a dream that the children can laugh and play in the sunshine, the way children should do, without being on drugs and getting pregnant before the finish high school. I have a dream that honest hardworking people can get an honest day's pay for an honest day's work, without the taxman taking it all away. I HAVE A DREAM!

I have a dream of a nation living in peace, in harmony with all of our neighbors. No more stealing and robbing and cheating. I have a dream, brothers and sisters!

I may not live long enough to see that day. But I pray to God Almighty that my children will! Praise God! Amen!

[weedapoopl]

Remind me again why we gave money to these thugs in the first place...
Posted by Hermit1948 at 12:24 PM : May 13, 2009

Same reason we gave billions to the auto makers, who are now pocketing the money and filing for bankruptcy so they never have to pay it back.

That's P-E-L-O-S-I.

Oh, wait, the AIG deal was cut before Obama took office.

And the chief negotiator was G-E-I-T-H-N-E-R.

Having any trouble connecting the dots on this one?