Just days—days—after the US government bailed out AIG to the tune of US$85 billion and the US citizenry collectively entered the insurance business, AIG executives headed to the St. Regis Resort in Monarch Beach, CA. While there, the company’s executives ran up a US$440,000 bill—US$200,000 for rooms, US$150,000 for meals, and US$23,000 for the spa. The royal we wonder where the remaining US$67,000 went, but that’s what imaginations are for.
Representative Henry Waxman (D-California) totaled up the figures in today’s House of Representatives committee hearing about AIG’s close call with the financial reaper. “Less than a week after the taxpayers rescued AIG, company executives could be found wining and dining at one of the most exclusive resorts in the nation,” Waxman said.
Sadly, but perhaps unsurprisingly, AIG executives continue to draw multimillion-dollar paychecks. In fact, documents provided by AIG to Waxman’s committee indicate that “as the company’s risky investments began to implode, the company altered its generous executive pay plan to pay out regardless of such losses,” according to Peter Whoriskey’s Washington Post account. In March, after having lost more than US$5 billion in the fourth quarter of 2007, AIG chief executive Martin Sullivan urged the company’s compensation committee to “ignore those losses” and award bonuses. Which, of course, it did, awarding Sullivan a cash bonus in excess of US$5 million and a golden parachute of US$15 million.
Update: Thursday, 09 October 2008 05:37AM CDT: On Wednesday, the US Federal Reserve announced that it would lend AIG an additional US$37.8 billion. Sigh.
