Posts Tagged 'Maurice Greenberg'

Chutzpah

There are three crosswalks on Ojai Avenue in one itsy-bitsy block between Signal and Montgomery streets.  For some people this abundance of traffic clogging, accident waiting to happen, laughingly named safety zones is not nearly enough.  So they create their own personal spaces by stepping into traffic wherever their little hearts desire.

Sweetie and I were cruising down the Avenue yesterday when a thirtyish woman, cardboard coffee cup in hand,  invited great bodily harm by forging an angular path between the Coffee Roasting Company and Rains department store.  Bristling with indignation, I was tempted to maintain my usual snails pace and come as close as possible to her comely derriere.  Weighing my options,  I took the coward’s way out and merely honked.  She paid not a whit of attention to my muted reproach and slithered her selfish way to the curb.

Sweetie and I then exchanged our usual “what a bozo, big jerk, some people’s children, may she rot in hell” expressions of pique.  We continued our remonstrations by sharing the customary “she must be very lonely and in need of attention.”  Ending with “I hope someone does that to her the next time the bitch is behind the wheel”, we went on our merry way.

Not to be outdone by the jaywalking sphinx, I marveled at the next bit of chutzpah to share itself with my otherwise boring day.  AIG, the multi-gazillion dollar financial behemoth, sought to establish itself as the champion ingrate of all time.

You remember AIG.  When the markets tanked in 2008 and Lehman Brothers was thrown to the wolves for not being big enough to fling the Earth off its axis, AIG came crawling on its knees, pencils in hat, apples on pushcart, and begged for a handout.  Since no one knew what AIG stood for or what they really did for a living, the U.S. Government (i.e. Joe Taxpayer) shoveled  $182 billion into AIG’s sidewalk cigar box.  Well over the amount needed to buy a pack of cigarettes or a bottle of Thunderbird, I wonder if Tim Geithner, Henry Paulson and ninety-nine percent of Congress had any idea what AIG was going to do with the leftover change.

No matter that AIG’s problems stemmed from its own greed in participating in the credit default swaps market (whatever that was.)  The end of America as we knew it would take place as surely as Columbus would fall over the edge of the earth if we didn’t reward private greed with a public handout.  So bailout we did.

Probably more as a result of the improving economy, less hysteria among the general public, and to little if any credit of their own, AIG mended its fences, guillotined the old execs and hired new folks who promised to never do that again.  And they paid back the $182 billion with interest.  And AIG started running TV ads thanking us for our largess.  And everyone lived happily ever after.

Sort of.  Today, Wednesday, AIG’s board of directors meets to consider joining other destitute investors who are suing the U.S. government for $25 billion.  Maurice Greenberg, former CEO of AIG, filed the suit last year on behalf of himself and other AIG investors.  Simply put, Maurice claims that the terms of the bailout were so skewed in the government’s favor that they constituted an unlawful taking of personal property, a no-no frowned upon by the   Fifth Amendment, which prohibits the taking of private property for “public use, without just compensation.”

Mr. Greenberg doesn’t claim that the bailout wasn’t needed.  Just that it was like an armed robbery of a drowning person headed down for the third time.  What Maurice fails to highlight is that without the $182 billion, all of us today would be saying “AIG, who?”

Maurice ran AIG for nearly forty years before resigning in 2005 amid accusations of fudging the books.  The lawsuit against the government has already cost us the time of a legion of U.S. attorneys.  Obviously in need of more recreational reading, Maurice as part of the suit has asked for 16 million pages of government documents.

So you wonder.  Why is AIG even considering being a party to this sham?  As AIG spokesman Jon Diat said… “The A.I.G. board of directors takes its fiduciary duties and business judgment responsibilities seriously,”  Maybe except when there’s a buck to made in the credit default swaps market.

While I was writing this diatribe, the AIG board did meet  this morning and decided not to be a party to the suit.  As the Times noted… Lawmakers in recent days have warned the company not to side with Mr. Greenberg, which would make it “the poster company for corporate ingratitude and chutzpah.”

The jaywalking sphinx is gonna be hard to beat.  But I bet Maurice will keep trying.

Maurice Greenberg


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