AIG Spa, AIG Retreat, AIG Party, AIG Vacation, American Taxpayers Scammed?

The Presidential candidates mentioned it in their debate last night and the newspapers are rife with reports today about the posh $440,000 spa retreat vacations taken by AIG executives and employees immediately after the U.S. government used $85 billion in taxpayer funds to keep the company out of bankruptcy.

Yesterday the House Committee on Government Oversight and Reform headed by Henry Waxman (D-Cal) began inquiries into why Lehman Brothers and AIG failed, an inquiry that by rights should have preceded the spending of a single taxpayer cent to bail out AIG and save it from the fate met by Lehman Brothers.

Instead, taxpayer funds rescued AIG executives from the natural consequences of their financial mismanagement. They responded in their typical, fiscally irresponsible manner, treating 70 AIG executives and employees to a week at St. Regis Resort in Monarch Beach, California, according to the Washington Post. The spa bill alone was $23,000. Meals for those 70 AIG executives and employees for a week cost another $120,000, an average of $244 per person per day for meals or $81 per meal per person. A typical American family doesn't spend as much as $244 per week feeding their families.

In his opening statement, Waxman said of the similarity between the Lehman Brothers and AIG failures, "the companies and their executives grew rich by taking on excessive risk. In each case, the companies collapsed when these risks turned bad. And in each case, their executives are walking away with millions of dollars while taxpayers are stuck with billions of dollars in costs."

Joseph Cassano, the former AIG financial products chief who is widely believed to have played an instrumental role in the company's downfall by engaging in risky transactions and resigned in March, continues to be paid $1 million per month from AIG as an advisor.

After failing to closely examine the causes for AIG's failure or limit spending by AIG in approving an $85 billion bailout, the Congress approved a $700 billion bailout for other yet to be identified failing Wall St. firms, again without advance scrutiny of the causes or spending limitations.