Why Lose Millions When You Can Lose BILLIONS?

Bailout.

It's never been a desirable term, but lately it's taken on a whole new meaning. The federal government has charged in valiantly to rescue Wall Street, saving countless multi-millionaires from having to cut back to 6 mansions apiece. Thank heavens.

But we'll leave the pros and cons of that particular deal aside for the moment.

What I want to discuss is another bailout. The bailout of insurance giant AIG. I'll admit up front that in my opinion, the insurance industry (along with pharmaceuticals) is one of the most greedy, self-centered, socially irresponsible industries in the U.S. As a whole, the insurance world overcharges, under-delivers, and is in general morally reprehensible.

In other words, I may be a tad biased.

But it sickened me to watch ABC Nightly News last night and discover that AIG, whose initial bailout has been restructured and increased to more than $150 BILLION, has yet again hosted an indulgent, overpriced "executive retreat"- this time in Phoenix Arizona.

Let me summarize.

1. AIG is the 18th largest company in the world, accoridng to Forbes Magazine. In 2008, it has more than $1 trillion in total assets.

2. AIG figures out a way to mismanage and/or piss away a nearly unimaginable amount of money while watching its credit rating do an imitation of Ryan Leaf's career.

3. The government agrees to bail them out, using $85 billion in public money to save a private company. AIG repays that show of faith by pampering its executives at a lavish resort to the tune of nearly half a million dollars.

4. As the economy worsens, AIG feels the effects even more strongly than anticipated, and asks COngress for additional funds. The bailout becomes $150 billion.

5. After securing the new deal, AIG holds a clandestine "retreat" in Phoenix. Highlights include the absence of corporate logos, a gag order on hotel employees, limos, champagne, cocktail parties, and..um... "continuing education seminars". Unfortunately, top executives seemingly didn't get the memo about that last bit, as these business meetings were eschewed in favor of days at the gym, spa, and pool.

Now clearly, a $440,000 dollar tab for the first retreat plus whatever they spend on Phoenix debacle doesn't amount to jack in the grand scheme of things. And AIG will tell you that the latter was almost entirely paid for by other corporate sponsors. But given the current state of affairs, isn't it more than a little unwise to treat your top executives in this manner?

Aren't they the ones who bear the most responsibility for the firm's near-collapse? While taxpayers are paying to keep them in business, CEO Martin Sullivan is receiving roughly $20 million in compensation this year alone. So...your company is hemmorhaging money. You're taking huge losses left and right. And yet you reward your top decision maker to the tune of $20 mill?

Joseph Cassano, who runs the financial products division, has earned more than $280 million since 2000. The kicker? He was FIRED in February. But wait- he still gets to keep $34 million in bonuses and gets a $1 million-a-month retainer. Yes, I said ONE MILLION PER MONTH.


All that said, AIG employs more than 100,000 people. The majority of whom would be without jobs if the company were to fail. I get that.

But even so, my question to you fine folks is this: Is there any justification for continuing to help this company the way we are?