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American International Group, the insurer rescued by the U.S. government in 2008 with a bailout that ultimately totaled $182 billion, may now join a lawsuit against the government alleging the terms of the deal were unfair, the company told Reuters news service Tuesday.
All the while broadcasting a commercial to the public with the tag line "Thank you America".
They knew the terms and what it meant for the future. They chose to ignore it though because they wanted the money.
Actually they didn't because a lot of the money the US government made was made through stocks it received in AIG. Since the stock did well the government did too. Now they are crying wolf for the profits the US raked in.
Its ridiculous though to say the least. The fact that the US government was even able to invest our tax dollars are absurd. Now AIG doesn't want us to profit from that investment. How do taxpayers win?
It's a half-truth that all these companies that got bailouts paid the money back (referencing the AIG ad). Even though on paper it may seem as though the U.S. government got back the money they gave out, that doesn't mean the government and more importantly the People were made whole. Every penny of the bailout had to be borrowed and consequently interest had to be paid on it. Additionally the economic conditions created by the actions of AIG and the Wall St. banks led to massive increases in unemployment (which cost the gov't money in benefits and lost tax revenue) and a recession (which led to reduced tax revenue and a devaluing of the currency).
Perhaps the worst consequence of the bailouts was the moral hazard that was created. The basis of AIG's lawsuit is for the most part that as part of the terms of the bailout the well connected Wall St. firms were to be paid back 100% of the money that was "owed" them, when in a normal bankruptcy situation those firms would have had to get in line with everyone else as AIG went through bankruptcy. The 182 billion dollars was not only a bailout of AIG but also a stealth bailout of major Wall St. firms like Goldman Sachs. It is Hank Greenberg's contention that the shareholders of AIG, including himself, would have been better off if the government had structured the bailout differently instead of just taking care of the well connected Wall Streeters. Because of the fact that these major players were not allowed to fail and then be replaced by more solvent market participants, a large portion of the economy is now devoted to making sure these firms stay alive at everyone else's expense. That's why we have 0% interest rates coming from the Fed. and millions of baby boomers unable to move their money into "safe" investments like bonds and still get a reasonable return. Instead they have to invest their money in riskier assets meaning that once again we're being set up for another colossal failure when these bets go south. I'm pretty sure AIG did not figure those costs of the bailout into their calculation that everything is paid back.
"Man recovering from near-fatal heart attack sues EMT who successfully administered CPR. Claims broken ribs resulted."
"Family sues local fire department for damages to carpet after successfully extinguishing large house fire."
"Owner of sunken yacht sues rescuer because thrown life ring conked him, causing large bruise on forehead."
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