Why AIG Really Needed $170 Billion in Taxpayer Money
Are you angry about the $165 million in bonuses AIG gave out? If you are, there's a reason for that: You're stupid and don't understand how things work in the financial world. You may think to yourself, "I wouldn't get a bonus if my company were failing," but of course you wouldn't. You're a nobody. But try to imagine someone so smart and so awesome that even if the company you gave him was going bankrupt, you'd want to give him millions of dollars. Hard to imagine someone like that, isn't it? Well, those are the sort of people running AIG. They are so beyond you it's laughable for you to even question them. Realize that for them, $165 million is a pittance. It's insulting. They're probably all demoralized right now from getting so little. If you really wanted AIG to succeed, you'd be demanding the executives at AIG get more bonuses so they'll consider saving the company to help your silly little economy.
But coming to a conclusion like that takes logic and reason; you just want to be angry at things you don't understand. Well some of us -- like AIG executives -- have better things to do than shake our fists and shout all day. After the bonuses, AIG still has $170 billion from the federal government to spend. That's a lot of work. You can't even comprehend spending that kind of money, but I'll try and help you understand what they're doing with that cash. Just promise you're not going to freak out over every little thing you don't understand.
Here's the breakdown:
$50 billion for foreign banks: Before you get all angry again and scream about how this money was to stimulate the American economy, realize that the "I" in AIG -- like the "I" in IHOP -- stands for "International." That means they're going to have to spend this money internationally. Yes, some of the countries they sent money to don't actually exist, but fraud like that is just a cost of doing business. There are a lot of countries out there, and you can't expect one company to keep track of which ones are real and which are not.
$12 billion for corporate catering: That may seem like a lot of money to spend on food, but that's because you're thinking in terms of what you're used to eating. Being executives at one of the world's largest companies, they can't just root through the garbage and eat whatever they find like you do. They have refined palates, and if they want Chinese food, they're going to have to fly a chef and ingredients in from China. If they want pizza, they're bringing in people from Italy. If they want a moon pie, they're sending a chef to the moon to build them a pie in low-G. That's just how things are done.
$5 billion for indoor waterpark at corporate headquarters: When kids in their on-site daycare get bored, they get whiny, and whiny children decrease productivity. The obvious solution: Build a waterpark. It can't be an outdoor waterpark, though, because if people come to AIG's corporate headquarters and the first thing they saw is a waterpark, no one would take them seriously. Of course, all the water will be FIJI.
$10 million for lobbying and political donations: That seems pretty anemic, especially considering that Congress provides most of their income. If they can get a second stimulus passed, that will be an astronomic return on investment.