Tue Jun 5, 2012, 08:56 AM
suffragette (8,619 posts)
This from the guy whose company received huge tax breaks in addition to the bailout
Last week, the American International Group reported a whopping $19.8 billion profit for its fourth quarter. It was a quite a feat for a company that was on its death bed just a little over three years ago, so sick that it needed a huge taxpayer bailout.
But if you dug into the numbers, it quickly became clear that $17.7 billion of that profit was pure fantasy ó a tax benefit, er, gift, from the United States government. The company made only $1.6 billion during the quarter from actual operations. Yet A.I.G. not only received a tax benefit, it is unlikely to pay a cent of taxes this year, nor by some estimates, for at least a decade.
The tax benefit is notable for more than simply its size. It is the result of a rule that the Treasury unilaterally bent for A.I.G. and several other hobbled companies in 2008 that has largely been overlooked.
This rule-twisting could deprive the government of tens of billions of dollars, assuming the firm remains profitable. The tax dodge ó and letís be honest, thatís what it is ó also will most likely help goose the bonuses of A.I.G.ís employees, some of whom helped create many of the problems that led to its role in the financial crisis.
But, hey have to find a way to keep the enormous salaries, bonuses and tax breaks flowing to the people who created the mess in the 1st place.
Also, the best way to "take the burden off of the youth" would be for people to be able to retire earlier, thus freeing up jobs for the youth, who now face increasingly high unemployment rates because of the austerity push by Benmoshe and his colleagues. And they would then be contributing to pension funds.
No coincidence that many of AIG's bailout pay outs went to the European banks whose high risk bets with AIG and others fed the crisis and who all sing in the same chorus demanding ever more austerity. And even as austerity is a clear failure when viewing the nations and majority of citizens it is crushing, it's clear the calls for it to continue are coming from the corrupt 1% who draw ever larger profits and benefits at the public's expense.
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