The massive taxpayer-funded bailout of AIG fueled anti-Wall Street rage, especially as news got out that billions in rescue funds paid to the insurance giant eventually went into the coffers of big banks like Goldman Sachs. But all the hand-wringing was perhaps unnecessary, says Daniel Gross says Slate, as it now appears that AIG might manage to pay back nearly all of the funds it got from the government. Here's an excerpt:
"AIG may be the only three-letter, four-letter word in the English language. The company ran into huge problems by selling insurance on financial assets without setting aside reserves to pay out claims. When the financial storm hit, no single private-sector company proved to be as messed up: The toxic issues surrounding its payments to Goldman Sachs on credit-default swaps, its absurd insistence on paying bonuses even as it racked up a $99 billion loss in 2008, the general lack of oversight by its executives. One number rankles above all: $182 billion -- the total financial aid extended by the Federal Reserve and Treasury Department to AIG.
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