AIG bailout: Taxpayers profit $15.1 billion

[Dont Taz Me Bro]

The US government is always investing in corporations.

And many of those "investments" are complete unmitigated disasters, like Solyndra.

Just because they do it doesn't mean they're legally allowed to. They just haven't been challenged on it in court.

 

[DiamondDave]

Paid in Full ... but Not in Cash

The federal government spent about $85 billion bailing out the auto industry during the economic crisis -- about $25 billion under President George W. Bush during his last days in office, the rest under President Obama.

Not all of that went to GM -- about $12 billion went to save Chrysler, and some went to Ally Financial, formerly GM's financing arm, and some other players -- but GM got the lion's share, just under $50 billion.

Technically, under the terms of the bailout, GM has in fact paid back its obligation to taxpayers. Its payments were a mix of cash and GM stock, which is exactly what was called for in the agreement.
Uncle Sam's GM Investment Is Still Coming Up Short - DailyFinance


Plus jobs were saved and revenue is coming in by way of taxes paid by employed.

Bitch... I don't care if it was Obama, Bush II, or the ghost of George Fucking Washington... I don't care if it was for GM, Chrysler, or fucking Apple.. it should not have been done.. the government is not empowered by the constitution to do such a thing

 

[Meister]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

Define the suspension of the Constitution.

Describe what you would have done instead. AIG was in collapse, and did not have the capital to pay off around a trillion dollars in credit default swaps. If they didn't, a literal chain reaction would have taken place in banks across the country and around the world, all of whom held that paper.

Thanks.

.

Maybe we could just get rid of the bankruptcy protection process and let the government intervene instead.

 

[Dont Taz Me Bro]

Paid in Full ... but Not in Cash

The federal government spent about $85 billion bailing out the auto industry during the economic crisis -- about $25 billion under President George W. Bush during his last days in office, the rest under President Obama.

Not all of that went to GM -- about $12 billion went to save Chrysler, and some went to Ally Financial, formerly GM's financing arm, and some other players -- but GM got the lion's share, just under $50 billion.

Technically, under the terms of the bailout, GM has in fact paid back its obligation to taxpayers. Its payments were a mix of cash and GM stock, which is exactly what was called for in the agreement.
Uncle Sam's GM Investment Is Still Coming Up Short - DailyFinance


Plus jobs were saved and revenue is coming in by way of taxes paid by employed.

The feds lost their ass on GM. Actually, I should say they lost our asses, since they don't actually have any money.

And so what if jobs were saved temporarily? GM still has a lot of problems caused by symptoms the bail out did not fix. They are by no means out of the water.

And we'll never knew what new and innovative car company might have risen from the ashes of Detroit that could have been more successful and put more people to work by not repeating the mistakes of GM and Chrysler. What was the opportunity cost of that bail out?

 

[LilOlLady]

The constitution is obsolete and has been amended 27 times and it's way past time for it to be rewritten for today.

 

[DiamondDave]

The constitution is obsolete and has been amended 27 times and it's way past time for it to be rewritten for today.

Then amend it.. you have a process.. or dissolve the union and start again with a new constitution... be my fucking guest, twatwaffle.... until that time, you abide the the constitution which is what defines the powers, roles, and limits of the federal government as granted by the states

 

[CrusaderFrank]

If you only count the times we get paid back, and leave GM FMNA and Freddie out, the government has a great track record as an investor

 

[Jarhead]

Define the suspension of the Constitution.

Describe what you would have done instead. AIG was in collapse, and did not have the capital to pay off around a trillion dollars in credit default swaps. If they didn't, a literal chain reaction would have taken place in banks across the country and around the world.

Thanks.

.

Where does the Constitution authorize the federal government to use our tax dollars to rescue failed companies?

You also say it "had to be done." Why? You assume that propping up a failed company and stopping it from going under is a good thing. In the short term, that may be true with less people losing their jobs, etc., but what about the long term effects? We'll never know which new company or existing may have been risen up to fill the hole left by AIG with a better business model. The government's actions also sent a message to company executives everywhere that if you screw up and you're "too big to fail" don't worry about it, we'll be here to bail you out.

This set a very bad precedent.

As I said in my first post, I hated it. But there were no better options.

Are you aware of the nature of the paper AIG held? Do you know who owned it? Do you understand what would have globally if they had defaulted on that paper?

.

I agree with Dave. Let the chips fall as they may. If it resulted in a financial disaster for us? So be it. We should be the generation to suffer for it...afterall, all we really did was kick the can down the road...and since? We are on the "fiscal cliff" and "brink of a recession" and "debt up to our eyeballs" and "threat of downgrading the US".....on a regular basis....

 

[Paulie]

Cool, what about all the assets the Federal Reserve is still sitting on?

 

[Meister]

The constitution is obsolete and has been amended 27 times and it's way past time for it to be rewritten for today.

Yeah, we need to get rid of the "We the people of the United States......" That ship has sailed a long time ago.
We need to give more power to the central government for the general welfare of it's minions.

 

[Mac1958]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

Define the suspension of the Constitution.

Describe what you would have done instead. AIG was in collapse, and did not have the capital to pay off around a trillion dollars in credit default swaps. If they didn't, a literal chain reaction would have taken place in banks across the country and around the world, all of whom held that paper.

Thanks.

.

Maybe we could just get rid of the bankruptcy protection process and let the government intervene instead.

Standard bankruptcy protocol would not have worked at that time, for three reasons: First, capital markets were completely frozen and there were no companies with either the will or the wherewithal to pick up the pieces in bankruptcy court.

Second, the entire financial system was in literal collapse, and bankruptcy proceedings would have taken months to iron out, at least. The condition of domestic and international markets was so fragile that allowing AIG's paper to turn to shit would have decimated markets globally. And I mean decimated. Something had to be done within days, hours, literally.

Third, AIG's financial tentacles reached far beyond our shores, with international banks and governments on the hook, having leveraged a wide variety of assets using AIG's insurance, which would not have paid had AIG defaulted. Huge pressure was being applied to Paulson and others to get something done immediately, and for good reason.

This was a (hopefully) once in a lifetime event that could not have been fixed with a trip to bankruptcy court.

.

 

[Oldguy]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

By your comment, I assume you believe the bailout was un-Constitutional, right?

Please explain how that's so.

 

[DiamondDave]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

By your comment, I assume you believe the bailout was un-Constitutional, right?

Please explain how that's so.

How so??

The power is not specifically granted in the constitution..

And please.. before you make an ass out of yourself.. no citing Article 1 Section 8 and leaving off everything after the word 'welfare'

 

[Oldguy]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

By your comment, I assume you believe the bailout was un-Constitutional, right?

Please explain how that's so.

How so??

The power is not specifically granted in the constitution..

And please.. before you make an ass out of yourself.. no citing Article 1 Section 8 and leaving off everything after the word 'welfare'

You really don't understand the Constitution or how it works, do you?

Let me be brief: Congress has the Constitutional power to pass any law it so chooses, so long as that law does not violate the Constitution. Congress long ago gave the Executive branch the authority to do what it did with AIG.

That makes it Constitutional.

 

[DiamondDave]

By your comment, I assume you believe the bailout was un-Constitutional, right?

Please explain how that's so.

How so??

The power is not specifically granted in the constitution..

And please.. before you make an ass out of yourself.. no citing Article 1 Section 8 and leaving off everything after the word 'welfare'

You really don't understand the Constitution or how it works, do you?

Let me be brief: Congress has the Constitutional power to pass any law it so chooses, so long as that law does not violate the Constitution. Congress long ago gave the Executive branch the authority to do what it did with AIG.

That makes it Constitutional.

No.. it does NOT.. see article 1 section 8.... the powers of congress are LIMITED and SPECIFIC.... and if they do something not specifically listed, it is in direct violation of the constitution... please see the 10th amendment

The executive branch's powers are also SPECIFICALLY listed...

Go educate yourself

Idiot

 

[Oldguy]

Yes.. by all means.. suspend the constitution whenever you 'feel' 'desperate'

Define the suspension of the Constitution.

Describe what you would have done instead. AIG was in collapse, and did not have the capital to pay off around a trillion dollars in credit default swaps. If they didn't, a literal chain reaction would have taken place in banks across the country and around the world.

Thanks.

.

Where does the Constitution authorize the federal government to use our tax dollars to rescue failed companies?

You also say it "had to be done." Why? You assume that propping up a failed company and stopping it from going under is a good thing. In the short term, that may be true with less people losing their jobs, etc., but what about the long term effects? We'll never know which new company or existing may have been risen up to fill the hole left by AIG with a better business model. The government's actions also sent a message to company executives everywhere that if you screw up and you're "too big to fail" don't worry about it, we'll be here to bail you out.

This set a very bad precedent.

We'll never know what company might have risen from the ashes of failure, but one thing we DO know is that the entire economy did not collapse, sparing millions upon millions of people from abject poverty and literal starvation.

And, make no mistake: That is PRECISELY what would have happened if the whole worlds banking system would have collapsed.

 

[Oldguy]

How so??

The power is not specifically granted in the constitution..

And please.. before you make an ass out of yourself.. no citing Article 1 Section 8 and leaving off everything after the word 'welfare'

You really don't understand the Constitution or how it works, do you?

Let me be brief: Congress has the Constitutional power to pass any law it so chooses, so long as that law does not violate the Constitution. Congress long ago gave the Executive branch the authority to do what it did with AIG.

That makes it Constitutional.

No.. it does NOT.. see article 1 section 8.... the powers of congress are LIMITED and SPECIFIC.... and if they do something not specifically listed, it is in direct violation of the constitution... please see the 10th amendment

The executive branch's powers are also SPECIFICALLY listed...

Go educate yourself

Idiot

It's obvious you are no Constitutional scholar, so I won't bother explaining the importance of amendments and court rulings on the literal wording of the Constitution. You wouldn't get it anyhow.

 

[DiamondDave]

Define the suspension of the Constitution.

Describe what you would have done instead. AIG was in collapse, and did not have the capital to pay off around a trillion dollars in credit default swaps. If they didn't, a literal chain reaction would have taken place in banks across the country and around the world.

Thanks.

.

Where does the Constitution authorize the federal government to use our tax dollars to rescue failed companies?

You also say it "had to be done." Why? You assume that propping up a failed company and stopping it from going under is a good thing. In the short term, that may be true with less people losing their jobs, etc., but what about the long term effects? We'll never know which new company or existing may have been risen up to fill the hole left by AIG with a better business model. The government's actions also sent a message to company executives everywhere that if you screw up and you're "too big to fail" don't worry about it, we'll be here to bail you out.

This set a very bad precedent.

We'll never know what company might have risen from the ashes of failure, but one thing we DO know is that the entire economy did not collapse, sparing millions upon millions of people from abject poverty and literal starvation.

And, make no mistake: That is PRECISELY what would have happened if the whole worlds banking system would have collapsed.

Ok Kreskin

 

[Quantum Windbag]

It looks like we were all wrong. The taxpayers will make a profit off the AIG bailout after all.


"Taxpayers will soon shed their last holdings in the American International Group, more than four years after a rescue by the federal government during the most chaotic days of the financial crisis….

…..At the time, critics feared that the company would be forced into a fire sale of assets to repay those loans, a sale that would deeply shortchange taxpayers.
Instead, the federal government has said that it expects to walk away from A.I.G. with a profit — about $15.1 billion to date, by the Treasury Department’s reckoning. That has followed both a steady stream of stock sales over the last two years and a resurgence in the insurer’s core operations….."

Bailout Over, U.S. Treasury Plans to Sell A.I.G. Shares - NYTimes.com

I wasn't wrong. I said it was stupid to bail them out, and I was right.

 

[Oldguy]

Ok Kreskin

Alright, prove me wrong. What WOULD BE the effects of a banking system collapse all over the world?