It was distasteful, if not disgusting when a few years ago the taxpayers bailed out the insurance giant AIG to the tune of $182 billion. The company had made very bad investments tied to mortgages and was unable to meet its financial obligations. No private investors were willing to jump in and rescue the company. Had AIG gone under, many pundits with a lot more knowledge than I have, believed that it could have had worldwide economic repercussions. Among the banks and two American automakers that were bailed out, AIG was the largest of the TBTF (too big to fail). In providing the money to AIG, the government placed what some consider onerous terms on the company. This was so because AIG was a huge risk, and at the time it wasn’t clear whether the taxpayers would ever get back any of their money. The bigger the risk, the higher the interest rate. That’s how all lenders and investors operate and is a basic of free markets.
Now comes Maurice “Hank” Greenberg, AIG’s former CEO who was ousted in 2005, to file a $25 billion lawsuit against the United States Government. He had retained a large number of shares in the company and believes that the terms of the aid were oppressive, whcih cost him money. Of course, without the bailout his shares would have been worthless because AIG would have gone bankrupt. Greenberg asked the AIG board to join his lawsuit, but to the board’s credit they refused. A U.S. District Court in New York threw out the claim, but it is on appeal in the Second Circuit. Meanwhile, Greenberg and his lawyers have filed a second lawsuit in The United States Court of Federal Claims in Washington.
Greenberg’s chutzpah reminds me of the bonuses that other bailout recipients paid themselves with taxpayer money arguing that it was pursuant to the terms of their employment contracts. Again, the institutions that did this would have gone belly up without the tax funded largess, but sometimes greed has no limits. His Porkulous, Rush Limbaugh, always an advocate of lower taxes and bulldog on government waste, was not troubled by the bonuses at the time. I can only guess that it was because he identifies with people at his income level who have no shame. If Greenberg feels like he got screwed, perhaps he should look at those responsible within AIG who prioritized their own self interests in making very questionable investments. And if Greenberg really cared anything about this country that allowed him to prosper beyond imagination, just maybe a scintilla of decency inspire him to contribute some of his vast wealth to the wounded warrior projects that unfortunately depend on private money. To say that this man has more crust than a pie factory would be a gross understatement.