Robert Benmosche, chief executive of American International Group (AIG), feels so vindicated by his company's turnaround from bailout-recipient to a company with actual value that he told the Wall Street Journal he was wondering whether he was going to get phone calls saying he was right:
“I was wondering if I might get a call from someone saying maybe 'you were right,' because we look better than we did last May and we can see the finish line from here, and it comes with a profit for the taxpayers,” Mr. Benmosche said in an email. “But as I learned in [Ayn Rand's book] 'Atlas Shrugged,' find your Thank Yous from within.”
When did Benmosche read “Atlas Shrugged”? After his company received a $182.3 billion bailout from taxpayers, where Uncle Sam became chief shareholder, owning 92 percent of his company? I can't seem to recall the part of the book where Rand said that your company should follow the Federal Reserve in lockstep and not disclose important information to taxpayers regarding what you're doing with their money:
AIG said in a draft of a regulatory filing that the insurer paid banks, which included Goldman Sachs Group Inc. and Societe Generale SA, 100 cents on the dollar for credit-default swaps they bought from the firm. The New York Fed crossed out the reference, according to the e-mails, and AIG excluded the language when the filing was made public on Dec. 24, 2008. The e-mails were obtained by Representative Darrell Issa, ranking member of the House Oversight and Government Reform Committee.
The New York Fed took over negotiations between AIG and the banks in November 2008 as losses on the swaps, which were contracts tied to subprime home loans, threatened to swamp the insurer weeks after its taxpayer-funded rescue. The regulator decided that Goldman Sachs and more than a dozen banks would be fully repaid for $62.1 billion of the swaps, prompting lawmakers to call the AIG rescue a “backdoor bailout” of financial firms.
Yes, Mr. Benmosche, you're a regular John Galt. I'll be sure to call you and tell you just that.