AIG chief invokes Ayn Rand while defending his bailout

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.

BailoutBeltway ConfidentialinsuranceUS

If you find our journalism valuable and relevant, please consider joining our Examiner membership program.
Find out more at www.sfexaminer.com/join/

Just Posted

Lakeshore Elementary School was closed in March shortly before SFUSD closed all schools due to coronavirus concerns. The district is now working to prepare all elementary schools to reopen by mid-January.<ins> (Kevin N. Hume/S.F. Examiner)</ins>
School district preparing buildings for hybrid learning

SFUSD plans to use 72 elementary schools and 12 early education sites for first phase of reopening

There have been at least 142 confirmed cases of COVID-19 among workers at San Francisco International Airport. <ins>(Kevin N. Hume/S.F. Examiner)</ins>
Supes back SFO worker healthcare legislation despite airline, business opposition

Costs of ‘Health Airport Ordinance’ in dispute, with estimates ranging from $8.4 M to $163 M annually

Thankfully, playgrounds that were closed due to the pandemic during the summer have reopened.<ins> (Kevin N. Hume/S.F. Examiner)</ins>
The perils of parenting, COVID-style

At long last, it’s OK to take your little one out to play

Ten candidates are running for a seat on the Board of Trustees of the San Francisco Community College District.. (Courtesy photos)
Strong leadership needed as City College faces multiple crises

Ten candidates vying for four seats on CCSF board

City officials closed San Francisco County Jail No. 4 on the top floor of the Hall of Justice at 850 Bryant St. in September, reducing the number of beds in the jail system by about 400. 
Kevin N. Hume/
S.F. Examiner
SF jail closure prompts doctor to call for release of more inmates

Reduced space increases risk of COVID-19 spreading among those in custody

Most Read