Moral outrage in the age of AIG

[bemildred]

Ever peel back an onion to find it rotten at the core? Both the protecting outer layers and the rot are offenders. For Americans, that is much the same experience as they learn more about AIG. Once the largest risk-taker in US home prices, AIG is now Wall Street's largest recipient of bailout money – and it just paid bonuses to its most culpable workers.

Congress plans a public flogging Wednesday of Edward Liddy, CEO of American International Group. It may not matter that he took the job only last fall at the government's request to prevent a corporate collapse that, at the time, Congress and others thought would bring down the financial system.

At the least, this moral venting might help reveal the truth behind AIG's risky actions and the regulators who were supposedly watching the exotic insurance schemes that AIG sold to expand the sale of mortgage-backed securities. But such hearings should also help reset the moral bearings of all those who ate of the forbidden fruit that was the nationwide betting on an ever-rising housing market and on the government enablers for those bets.

Almost every moral dilemma in this economic crisis is wrapped up in the still-unpeeling story of AIG. Yet Americans simply want someone to blame – someone to fall on their sword – for having caused all the financial excess, the home foreclosures, the shrunken nest eggs, and now rising unemployment.

http://www.csmonitor.com/2009/0318/p08s01-comv.html

[Name removed]

1. Deleted message

Message removed by moderator. Click here to review the message board rules.