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Showing posts with label bailout. Show all posts
Showing posts with label bailout. Show all posts

Friday, January 3, 2014

AIG executives enjoy retreat on US bailout money

White House: AIG execs' retreat `despicable'
Source: Associated Press Internet

WASHINGTON (AP) — The White House said on Wednesday it was "despicable" that American International Group Inc. executives spent hundreds of thousands of dollars on a posh California retreat just days after getting a federal bailout.

Lawmakers investigating the meltdown of AIG said the retreat didn't include anyone from the financial products division that nearly drove the company under, but they were still enraged that executives of AIG's main U.S. life insurance subsidiary spent $440,000 on the retreat, complete with spa treatments, banquets and golf outings.

"It's pretty despicable," White House press secretary Dana Perino said.
AIG sent its executives to the coastal St. Regis resort south of Los Angeles even as the company tapped into an $85 billion loan from the government that it needed to stave off bankruptcy. The resort tab included $23,380 worth of spa treatments for AIG employees, according to invoices the resort turned over to the House Oversight and Government Reform Committee.

"The president did not want to move forward on this rescue package to help anybody in the top positions on Wall Street," Perino said. "He was concerned about everyday people like you and me. ... He didn't do that to help top executives and certainly not to help executives go to a spa."

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AIG continues misuse of bailout funds.

AIG continues misuse of bailout funds.
Source: Internet

American International Group agreed Thursday to help the New York State attorney general’s office recover tens of millions of dollars in improper expenditures, including compensation given to two former top executives.

A.I.G. also agreed to cancel a $10 million severance package for its former chief financial officer, Steven J. Bensinger. He was replaced on Thursday by the giant insurance company’s comptroller, David L. Herzog.

The agreement came a day after Attorney General Andrew M. Cuomo assailed A.I.G. for making “unwarranted and outrageous expenditures” that he said violated New York law and that he called particularly “irresponsible and damaging” in light of the federal government’s $123 billion rescue of the company.

Mr. Cuomo criticized in particular the multimillion-dollar payments to Martin Sullivan, A.I.G.’s former chief executive, and Joseph J. Cassano, who ran the unit blamed for the losses that pushed the company to the brink of collapse. A.I.G. agreed Thursday to help recover that money.

Mr. Cuomo met Thursday with A.I.G.’s new chief executive, Edward M. Liddy, and the agreement was announced jointly by them.

Under the terms of the agreement, A.I.G. will provide the attorney general’s office with an accounting of all compensation paid to its senior executives. A.I.G. also agreed agreed to cancel all junkets and benefits that are not justified by legitimate business needs. AIG will immediately cancel more than 160 conferences and events, some exceeding more than $750,000 per event, for a total savings of more than $8 million.

Still, ABC News reported Thursday evening that A.I.G. was still paying hundreds of thousands of dollars for a luxury suite at Madison Square Garden, the home of the New York Knicks and Rangers. An A.I.G. spokesman told ABCNews.com that the contract for the suite was signed in February and that it had been used by its brokers and clients, although that is expected to stop.

Mr. Cuomo, in a letter to A.I.G.’s board on Wednesday, assailed the company for allowing executives to take golf and hunting trips after the government extended an initial $85 billion line of credit to the company. A handful of A.I.G. officials flew to England on a private jet for a partridge hunt that reportedly cost about $90,000. The use of the plane cost about $17,000, according to a person familiar with Mr. Cuomo’s investigation.

On Thursday, the company also agreed to establish tighter management controls on future expenses to prevent any future unwarranted spending on salaries, bonuses, stock options, severance payments, gratuities, benefits, junkets and perks.

Mr. Cuomo noted in his letter that Mr. Sullivan and Mr. Cassano were paid millions of dollars even as A.I.G.’s losses were mounting.

“The board awarded its chief executive officer a cash bonus of over $5 million and a golden parachute worth $15 million,” Mr. Cuomo wrote. “Similarly, in February 2008, a top-ranking executive who was largely responsible for A.I.G.’s collapse was terminated, but still permitted by the board to keep $34 million in bonuses. This same individual apparently continued to receive $1 million a month from the company until recently.”

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Monday, June 29, 2009

I didn't write this statement, but, I agree!

Subject: I didn't write this statement, but, I agree!
Source: Email contribution - unverified

I have come to think there is something monumentally large afoot, and I do not believe it is simply a banking crisis, or a mortgage crisis, or a credit crisis. Yes these exist, but they are merely single facets on a very large gemstone that is only now coming into a sharper focus.

Something of historic proportions is happening. I can sense it because I know how it feels, smells, what it looks like, and how people react to it.. Yes, a perfect storm may be brewing, but there is something happening within our country that has been evolving for about ten to fifteen years. The pace has dramatically quickened in the past two.

We demand and then codify into law the requirement that our banks make massive loans to people we know they can never pay back? Why?

We learned just days ago that the Federal Reserve, which has little or no real oversight by anyone, has "loaned" two trillion dollars (that is $2,000,000,000,000) over the past few months, but will not tell us to whom or why or disclose the terms. That is our money. Yours and mine. And that is three times the $700 billion we all argued about so strenuously just this past September. Who has this money? Why do they have it? Why are the terms unavailable to us? Who asked for it? Who authorized it? I thought this was a government of "we the people," who loaned our powers to our elected leaders. Apparently not.

We have spent two or more decades intentionally de-industrializing our economy. Why?

We have intentionally dumbed down our schools, ignored our history, and no longer teach our founding documents, why we are exceptional, and why we are worth preserving. Students by and large cannot write, think critically, read, or articulate. Parents are not revolting, teachers are not picketing, school boards continue to back mediocrity. Why?

We have now established the precedent of protesting every close election (violently in California over a proposition that is so controversial that it simply wants marriage to remain defined as between one man and one woman. Did you ever think such a thing possible just a decade ago?) We have corrupted our sacred political process by allowing unelected judges to write laws that radically change our way of life, and then mainstream Marxist groups like ACORN and others to turn our voting system into a banana republic. To what purpose?

Now our mortgage industry is collapsing, housing prices are in free fall, major industries are failing, our banking system is on the verge of collapse, social security is nearly bankrupt, as is Medicare and our entire government. Our education system is worse than a joke (I teach college and I know precisely what I am talking about) - the list is staggering in its length, breadth, and depth.. It is potentially 1929 x ten... And we are at war with an enemy we cannot even name for fear of offending people of the same religion, who, in turn, cannot wait to slit the throats of your children if they have the opportunity to do so.

And finally, we have elected a man that no one really knows anything about, who has never run so much as a Dairy Queen, let alone a town as big as Wasilla , Alaska . All of his associations and alliances are with real radicals in their chosen fields of employment, and everything we learn about him, drip by drip, is unsettling if not downright scary (Surely you have heard him speak about his idea to create and fund a mandatory civilian defense force stronger than our military for use inside our borders? No? Oh, of course. The media would never play that for you over and over and then demand he answer it. Sarah Palin's pregnant daughter and $150,000 wardrobe are more important.)

Mr. Obama's winning platform can be boiled down to one word: Change. Why?

I have never been so afraid for my country and for my children as I am now.

This man campaigned on bringing people together, something he has never, ever done in his professional life. In my assessment, Obama will divide us along philosophical lines, push us apart, and then try to realign the pieces into a new and different power structure. Change is indeed coming. And when it comes, you will never see the same nation again.

And that is only the beginning..

As a serious student of history, I thought I would never come to experience what the ordinary, moral German must have felt in the mid-1930s In those times, the "savior" was a former smooth-talking rabble-rouser from the streets, about whom the average German knew next to nothing. What they should have known was that he was associated with groups that shouted, shoved, and pushed around people with whom they disagreed; he edged his way onto the political stage through great oratory. Conservative "losers" read it right now.

And there were the promises. Economic times were tough, people were losing jobs, and he was a great speaker. And he smiled and frowned and waved a lot. And people, even newspapers, were afraid to speak out for fear that his "brown shirts" would bully and beat them into submission. Which they did - regularly. And then, he was duly elected to office, while a full-throttled economic crisis bloomed at hand - the Great Depression. Slowly, but surely he seized the controls of government power, person by person, department by department, bureaucracy by bureaucracy. The children of German citizens were at first, encouraged to join a Youth Movement in his name where they were taught exactly what to think. Later, they were required to do so. No Jews of course,

How did he get people on his side? He did it by promising jobs to the jobless, money to the money-less, and rewards for the military-industrial complex. He did it by indoctrinating the children, advocating gun control, health care for all, better wages, better jobs, and promising to re-instill pride once again in the country, across Europe , and across the world. He did it with a compliant media - did you know that? And he did this all in the name of justice and ..... . .. change. And the people surely got what they voted for.

If you think I am exaggerating, look it up. It's all there in the history books.

So read your history books. Many people of conscience objected in 1933 and were shouted down, called names, laughed at, and ridiculed. When Winston Churchill pointed out the obvious in the late 1930s while seated in the House of Lords in England (he was not yet Prime Minister), he was booed into his seat and called a crazy troublemaker. He was right, though. And the world came to regret that he was not listened to.

Do not forget that Germany was the most educated, the most cultured country in Europe . It was full of music, art, museums, hospitals, laboratories, and universities. And yet, in less than six years (a shorter time span than just two terms of the U. S. presidency) it was rounding up its own citizens, killing others, abrogating its laws, turning children against parents, and neighbors against neighbors.. All with the best of intentions, of course. The road to Hell is paved with them.

As a practical thinker, one not overly prone to emotional decisions, I have a choice: I can either believe what the objective pieces of evidence tell me (even if they make me cringe with disgust); I can believe what history is shouting to me from across the chasm of seven decades; or I can hope I am wrong by closing my eyes, having another latte, and ignoring what is transpiring around me..

I choose to believe the evidence. No doubt some people will scoff at me, others laugh, or think I am foolish, naive, or both. To some degree, perhaps I am. But I have never been afraid to look people in the eye and tell them exactly what I believe-and why I believe it.

I pray I am wrong. I do not think I am. Perhaps the only hope is our vote in the next elections.

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Monday, December 8, 2008

Auto Industry - A bridge to survival

Auto Industry - A bridge to survival
Source: Email contribution

LETTER TO THE EDITOR (or anyone else who will listen)
Auto Industry - A bridge to survival

$40,000,000,000 to AIG, $20 billion to Citibank and billions more to other Wall street giants. They loaned money to, or insured debt of, people or companies that had no realistic chance to pay it back. Now that's bad business and extreme mismanagement. Add insult to injury the government forks over billions and these executives go off on a multimillion dollar retreat in the California sunshine.

Those same congressmen and senators and even the public are ok with that (evidence: we keep giving them more) yet they blast the American auto industry for poor management and are apparently willing to flush GM, Ford, and Chrysler with their morning constitutional.

I only wish they would deal with the issue from a basis of fact, not outdate perceptions, emotions, hyperbole, rhetoric and media and congressional politi-speak.

They ask, "Why can't you build vehicles people want and why can't you build a quality vehicle?" Well, if you haven't driven a GM product built in this century then you don't have a clue as to the quality, from drivability to fuel efficiency (the Pontiac G5 gets up to 44 miles per gallon and costs less than $15,000) to interior, to fit and finish to price.

Before some greedy speculators sent the price of oil to the moon and gas prices to over $4.00 a gallon GM was building what you wanted. To charge that they didn't adjust fast enough--NOT FAIR. Go drive the back lot of the Toyota store on Arapahoe road that is sitting with over 500 new full size Tundra pick-ups. No manufacturer was able to adapt to the unwarranted, practically overnight gouging of $4.00 plus gas prices. Before that GM, Chrysler, and Ford products represented over 50% of the vehicles purchased in the United States and a much larger percentage of the worldwide market. Not bad for vehicles nobody wants.

We lambaste the American auto industry for mismanagement while we praise anything made by foreign companies. How about toys, and dog food, and mouth wash from China...Thanks, I'll go American.
After 9-11 Chrysler, Ford and GM each contributed $10 million and by the way their employees did as well, $60 million dollars to support the victims of that heinous attack. What did Honda, Toyota, Nissan and virtually all the other import car companies, who reap billions from the U.S. economy, contribute? Not one red cent. Hey imports thanks for nothing.

Let's talk facts versus fiction for just a moment. Not approving the bridge loan the auto makers are asking for would be devastating.

Nearly 3 million jobs would be lost in just the first year alone, another 2.5 million jobs gone over the next 2 years.
Personal income in the United States would drop more than150.7 billion in the first year, another $100 billion over the next two.

The cost to local, state and federal governments would be over $155 billion in three years in lost taxes, unemployment and health care assistance.

Domestic automobile production would grind to a nearly complete halt, even by international producers, due to supplier bankruptcies.

The credit crisis that is affecting all of us is wounding the U.S. auto industry in many ways. Car makers can't get loans to restructure and produce new technology vehicles. Suppliers and dealers can't get loans for routine business and customers can't get loans to buy new cars. Banks have been given billions yet they refuse to loan the money, instead opting to either buy other banks or so just simply hoard the cash.

When the initial $700 billion bailout was announced the public was outraged and said "don't pass it." So Congress didn't pass it....a week later and a market that lost billions including many Americans 401k's and retirement funds, had those same john Q publics screaming for law makers to pass it and pass it now. It got a 2nd chance and was passed. If Congress rejects the bridge loan to the auto makers there may not be a 2nd chance, just a tsunami of economic disaster.

I urge everyone to support the loans as well as a one-time 1% tax credit for the purchase of a new vehicle and a tax write-off for interest and sales tax.

Finally, just a few more facts.
9.3 million people worldwide bought GM vehicles last year. That's more vehicles than any other automaker in the world sold. And in the U.S., which is the world's largest market, GM sold more vehicles than any other manufacturer in 2007, and it has sold more than any other manufacturer to date in 2008.

In 2008 Chevy Malibu was named North American car of the year and Cadillac CTS was Motor Trend’s 2008 car of the year. In 2007, the Saturn Aura and Chevy Silverado won North American car and truck of the year. Those awards are given and judged by automotive journalists.

Customers responded just as enthusiastically as the critics. Although total U.S. vehicle sales are down almost 15% so far this year, a number of GM vehicles enjoyed significant sales increases:

Malibu +39%
Pontiac Vibe +36%
Pontiac G6 +4%
Cadillac CTS +15%
Aura +7%
GMC Acadia +2%
Buick Enclave +88%.

From plants to parks, from dealerships to driveways, from gas stations to grocery stores, what happens in the automotive industry affects each and every one of us. In fact, the collapse of the industry wouldn't just impact the nearly 355,000 Americans directly employed by the Big Three. One out of every 10 people in America is employed in a service that is related to the U.S. auto industry. If a plant closes, so does it suppliers, the local stores, the hot dog vendor and the local restaurants.

GM has cut its payroll drastically, by 45.8% in the U.S. alone since 2000. In fact GM is far from the largest employer in the industry. With 252,000 employees worldwide, GM ranks fifth overall behind, VW, Toyota, Renault/Nissan and Daimler. Yet GM sold more vehicles worldwide last year than any other automaker.
Don't penalize a company that pays its union employees twice what non union shops pay...a company that provides health care and pensions to its employees and retirees. Don't reward manufacturers that build their products here but take the profits back to their home countries, while paying their employees far less and providing much less for them in the way of healthcare and retirement. Don't say you support the workers and the middle class and then buy an import, because you saved a couple of hundred dollars.

GM, Chrysler and Ford have supported America for nearly 100 years. They truly are the backbone of U.S. manufacturing.

I'm proud to be an American and I'm proud to be a GM dealer. I have great faith that we will survive this extremely difficult time and be stronger for it.

Mike Malin

Vice President and Owner
Grand Pontiac Buick GMC

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