AIG recently rolled out a new television ad campaign called "Thank you, America," in which the company humbly expresses its gratitude for the massive $182 billion bailout it received from taxpayers at the height of the financial crisis. (Watch one of the ads below.) And the Treasury announced in December that it had sold its last remaining stake in the insurance giant, ending a fraught relationship that earned the government a neat $22.7 billion profit — a point underscored by AIG in its latest ad blitz.
But it seems that what AIG is really saying is, "Thank you, America — for nothing." The New York Timesreports that AIG's board of directors is considering joining a $25 billion lawsuit against the government for rescuing the company from oblivion. Per Ben Protess and Michael J. De La Merced at the Times:
The lawsuit does not argue that government help was not needed. It contends that the onerous nature of the rescue — the taking of what became a 92 percent stake in the company, the deal’s high interest rates, and the funneling of billions to the insurer's Wall Street clients — deprived shareholders of tens of billions of dollars and violated the Fifth Amendment, which prohibits the taking of private property for "public use, without just compensation." [The New York Times]
The charge is being led by former AIG CEO Maurice "Hank" Greenberg, who still owns a chunk of shares. He is demanding that AIG join the suit, contending that the bailout diluted the value of his and other stockowners' shares, imposed an overly burdensome interest rate on bailout loans, and used AIG money to "bail out" the company's trading partners. If AIG declines to sue the government, analysts say the company could become the target of Greenberg's litigious ire.
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Greenberg's suit has already been dismissed by one judge in 2011, who noted that AIG "voluntarily accepted the hard terms offered by the one and only rescuer that stood between it and imminent bankruptcy." A spokesman for the Federal Reserve has said, "There is no merit to these allegations."
Perhaps the government should fight fire with fire, and produce an AIG-themed ad campaign of its own. A possible message: "Are you freaking kidding me?"
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