AIG & How the Government has Failed

The liberal mantra dictates that you need government to protect society from evil large corporations. As applied to AIG, many believe the company was simply "too big to fail", and that allowing it to fail would have guaranteed "the greatest crisis since the Great Depression" (how many times have we heard this). To this, I say... hogwash.

The reality is that there are plenty of well capitalized, non-bankrupt insurance companies that would be interested to buy parts of AIG's business. This happens all the time in the FREE-MARKET. Will some parties lose money? Of course, again this is normal in the free market.

Do you know where the $165 Billion went? Well over two thirds of it was given to FOREIGN banks, who were paid 100% on the dollar for their investments with a company that went bankrupt. Explain to me how paying back foreign banks in full, that would normally receive pennies on the dollar, benefits the US economy?

For all the mistakes AIG made, consider that those who make investments with them are responsible to conduct their own due diligence and accept risks for making investments. It's silly that the US government bailed them out just so that foreign investors could be repaid. The alternative was that their assets would be sold off to other, healthier companies. This is the natural flow of business and it is how wealth is created.




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