AIG subsidiary parties in style in OC, two weeks after bailout
October 2nd, 2008, 7:00 am posted by Teri Sforza, Register staff writer
Financial crisis? What financial crisis?
Less than two weeks after Uncle Sam gave American International Group (AIG) an $85 billion loan - staving off financial collapse - execs from one of its insurance subsidiaries, AIG American General, gathered for a conference at the uber-swank St. Regis Monarch Beach Resort, billed as “California’s only Mobil Travel Guide Five-Star Resort,” where ocean-view rooms start at $565 a night and “world class luxury” is the rule.
On Friday, before the presidential debate got under way, caterers for the St. Regis were setting up dozens of tables on the grounds of Mission San Juan Capistrano for AIG American General’s sumptuous off-site dinner. Tables were draped with soft Tuscan-gold tablecloths that cascaded to the grass; elegant fresh flower centerpiece graced each table; and what appeared to be fine crystal stemware, at least from a distance, glistened in the fading light.
Workers set up a lengthy bar stocked with bottles of liquor. A half-dozen tall space heaters stood sentinel in case the evening turned cool. There was a large center stage with lighting and a sound system, and once the sun went down, the whole scene took on a magical patina as tiny white lights twinkled in the trees.
The Watchdog - and the Outraged Taxpayer who alerted us to the situation - understand that corporate events such as these are planned many months in advance. I mean, really. Who could have known in the spring that there’d be Financial Armageddon in the fall?
But still. “The inappropriateness and the excessiveness just blew us away,” said the Outraged Taxpayer, who went to the Mission Friday to pray in the chapel. “It’s outrageous. In very poor taste. Over the top.”
AIG says it’s not what it seems.
The St. Regis conference included recognition for vital independent agents who distribute AIG American General’s products - insurance for individuals and businesses. AIG American General - a subsidiary of parent AIG - is in much, much better financial shape than AIG itself. ”It’s one of our viable businesses,” said AIG spokesman Joseph Norton. “They’re fully capitalized. They’re fine. It wasn’t a corporate kind of thing.”
Appearance, though, is powerful.
“When people hear things like this, it makes it difficult to sell people on a bailout plan,” said Tara Setmayer, communications director for Congressman Dana Rohrabacher, who opposes a bailout. “Of course the events are planned in advance, but from a PR perspective, it doesn’t go over well.”
Like every congressional office, Rohrabacher’s was inundated with outraged calls and emails opposing a bailout. ”No one is bailing us out!” Average Joes were saying. “Why should we bail out those Wall Street fat cats?”
(Suggestion to those crafting the next bailout - er, ”rescue’ - bill: Consider a cap on expenses as well as executive compensation?)