Tuesday, November 11, 2008

Hey fellas, next week we're in Cannes!

AIG is much on my mind this morning. The insurance colossus is getting yet another $40 billion to salve its financial wounds, this latest package announced just within days. It's funny, forty-billion hardly sounds like that much anymore, given the sums that various American entities have been bleeding out of late. (And we haven't even really heard from the auto industry. Just wait.) Maybe that's why AIG execs didn't feel so bad about splurging $343,000mere pocket change!at Phoenix's Pointe Hilton Squaw Peak Resort (shown).* Although, apparently they felt bad enough, or more like guilty enough, to eschew the corporate banners that typically identify such retreats, which is why it took reporters with hidden cameras to sort it all out. "AIG made significant efforts to disguise the conference, making sure there were no AIG logos or signs anywhere on the property," reported KNXV-TV, ABC's Phoenix affiliate.
Let's be clear here, this isn't the first $400,000 junket we're still talking about; that's ancient history. (You can't expect these people to get by on just one $400,000 retreat per month, can you?) This is another bash that took place this past week, more or less at the same time AIG was pleading its case for additional bailout money.

It occurs to me: If they pull stuff like this after the bailout(s)when you'd think there are cooler heads within the company who (1) have consciences, and would therefore (2) be at least a little bit sensitized to the overtones of further profligacyyou can imagine what went on before the feds stepped in.

You wonder where the AIG movable fleece will turn up next.

What I'm about to say is unoriginal thinking, but I have to say it to somebody, so you're elected. Homeowners and the rest of the poor shnooks who got themselves into a financial pickle have no bailout forthcoming,** and probably can't afford to go hang out poolside at a place like the Pointe while they're waiting to see what becomes of them. I can't get over the hubris: These jokers, when times are good, rake in millions and live like kings. And when times are less good, they go running to Mommy (otherwise known as Henry Paulson) to make it all better...and they still live like kings. There are no repercussions. They are seldom forced to face the music (unless it's chamber music during dinner at some posh resort), let alone in any personal, individual sense. Yeah, I'm sure Art Tambaro, CEO of an AIG subunit called Royal Alliance Associates, was all broken up about everything as he sat by the Jacuzzi sipping his margarita.

I know the argument: These companies can't be allowed to fail. They're too big. They have tentacles that snake off into every facet of American society, so the ripple effect (if you'll pardon my mixed metaphors) would be catastrophic. Deregulation and the overall conglomeratization of American business has rendered some corporations, if not entire sectors, bulletproof. Even when they "go FUBAR"***, there's nothing the rest of us can do but swallow hard and pay the tab. Well that's part of the problem, folks, and needs to be addressed by our incoming president.

Can you spell d-i-v-e-s-t?

And what made me even angrier was that last night, as I'm watching coverage of the story on CNN, I toggle over to FOX...and what do I see but an ad touting a golden opportunity for real-estate speculators to pick up some hot foreclosed properties at a soon-to-be-held federal auction. Talk about perverse synchronicity.

* In fairness, the Pointe is not ultra-grand luxe, but it's very, very nice. I've been there several times, and even once stayed in a casita of the type occupied this past week by AIG's Tambaro
though I'm sure his suite was rather more nicely appointed.
** I'll believe that all the talk about rescuing homeowners is legit when I see it filter down to the street level. And how is any future rescue plan going to help the tens of thousands of Americans who already lost their homes?
*** How well-versed are you in your "major themes from Saving Private Ryan"?

12 comments:

Anonymous said...

America Discovers That Bailout Will Be Used To Pay Wall Street Bonuses
http://tinyurl.com/5eqel3

Stever Robbins said...

This is really quite fascinating. They're going to be surprised and cry bloody murder when serious regulation gets handed down from Washington, with the hearty approval from Main Street.

There will be hue and cry that regulation will "stifle the economy." But we've racked up $1 trillion in a war and now $1+ trillion into a bailout (Our total economy is about $7 trillion).

We'd have to "stifle the economy" to the tune of $1 trillion before we'd be using up more than we're currently giving to these folks in cash and bailouts.

Though I'm not normally a fan of regulation (except in tragedy of the commons type cases), at this point, it's becoming clear that we can't count on the folks who proudly proclaim they can police themselves to do the right thing here.

Wall Street says they need freedom to "innovate." I think they've innovated just fine. Now they need to drop the innovation and return to the good, old fashioned non-innovation of responsibility and good citizenship.

Mike Cane said...

Christ, I cover enough Doom in my blog. Now you're doing it here too?

I least I get to quit after 12/31/08.

Steve Salerno said...

OK, I'll bite: What happens on 12/31/08? Did I miss something? Does this have to do with the Mayan calendar or some such?

Anonymous said...

"What happens on 12/31/08? Did I miss something? Does this have to do with the Mayan calendar or some such?"

No, the Mayan calendar ends December 21 2012 around the same time as the next presidential election ends. I guess Palin will win and the world will end!

Anonymous said...

I'm with Stever. I would love to believe that free markets work, but people sure don't! We can't trust the bankers/business types to be honest with the books unfortunately, which means regulation. Like anything, once the trust is gone, it is hard to recapture again. Remember, we just had Enron in 2001 and now this? We can no longer afford the greed culture and might I add, aren't these the types of scenerios that start revolutions? When the poor get tired of feeding the fat cats, anarchy happens.

Steve Salerno said...

Anon 4:51, I actually knew that. I was just making a funny...

But that's a good point about Palin and the synchronicity.

Steve Salerno said...

Anon 5:00, I've heard Obama's election described as a bloodless revolution--that his victory was brought about by a mood of anger and total distrust of the powers-that-be, rather than the inherent appeal of the man himself. I prefer to see it as a combination of the two: The old regime offered only hopelessness, whereas Obama offered hope. Either way, I think I'd agree with the characterization: Election 2008 was a revolution.

And yet I still can't quite get over the fact that he won by a mere margin of 7 percentage points (pop vote), and that Republicans, having licked their wounds and gone through most of the Kubler-Ross stages, are now rallying around Palin as the future salvation of the GOP.

What world do such folks inhabit?

Anonymous said...

Steve,
it is the world where G.W.Bush is considered a thoughtful orator, as per one right-wing blogger :

"Bush never gets sloppy when he is speaking publicly. He chooses his words with care and precision, which is why his style sometimes seems halting. In the eight years he has been President, it is remarkable how few gaffes or verbal blunders he has committed. If Obama doesn't raise his standards, he will exceed Bush's total (in gaffes) before he is inaugurated."

This is *not* a joke, in case you wonder.

See Bob Cesca commentary, "What Doesn't Kill The Far-Right Only Makes Them Crazier."

http://tinyurl.com/5jgc2t

Steve Salerno said...

Wow. That didn't come out of the Onion?

RevRon's Rants said...

Damn! I just laughed so hard, my root beer... well... let's just say it's time for a new keyboard! :-)

I mean, how many presidents have we had that provide enough gaffes to fill a calendar with new ones every day of his tenure (a-la Bushisms)?

Verification word: midiwiti (you just can't make this stuff up!)

Mike Cane said...

>>>OK, I'll bite: What happens on 12/31/08?

Well it'd be pretty effing silly to do a blog called Mike Cane 2008 in 2009, now wouldn't it?