Monday, March 2, 2009
At what point do we just pull the plug? We're up to $162.5 billion dollars in AIG bailout and economists don't see an improvement anytime soon. When a company loses $61.7 billion in a single quarter ($99 billion for the year), is there any financial reason to prop up the company to continue bleeding? Sure, the counter argument is that this would destabilize the financial sector to which I reply, "It isn't already?" Then there's the all the people out of work counter argument which is slightly better, for no one wants to throw the 116,000 that AIG employs out on the streets. But, if taxpayers are simply throwing money at the company that is so far away from turning a profit why not just throw it right into the employees' pocket via welfare or unemployment and bypass the facade of a company. Furthermore, if these stimulus packages are supposed to be creating job, wouldn't we just spend tax payer dollars in that direction instead of for a specific, horribly failing company? Pull the plug already.
"Some analysts have estimated that AIG could be in line for as much as $100 billion more in government aid at some point, putting the exposure of the American taxpayer to the insurer in the neighborhood of a quarter of a trillion dollars."
How much more time, effort, and most notably money can the government throw at a sunk company?