Tuesday, November 25, 2008

Our Tax Dollars at Work

I probably should have commented on all of the business bailouts our fine federal government has committed the taxpayers of this country to fund. Our government keeps handing out money to troubled firms to keep them from having to face bankruptcy. So what do we have to show for our money?

First, we have AIG Insurance who received $85 billion from the government. A few days after receiving the money, AIG spent $440,000 for a retreat at an exclusive spa for some of it's agents. Naturally, that raised a few eyebrows as to how are money was being spent. It was not enough, however, to keep the government from "restructuring" AIG's bailout to make it a total of $150 billion. (More on AIG later.)

Next we have the CEO's from the big three American automakers, GM, Ford, and Chrysler, coming to the nation's capital to beg Congress for $25 billion to help them get through some tough times. Times are tough for the automakers, so tough that each CEO flew to Washington in three separate private corporate jets. Thankfully, they left without the money.

The latest to dip into the taxpayer's wallets is Citibank. Citibank has recently released 53,000 workers and had their stock price cut in half. The government has invested another $20 billion in Citibank on top of the $25 billion Citibank received in the initial "Troubled Assets Relief Program." Citibank, though, has no plans to try to get out of a $400 million deal for the naming rights of the New York Mets new stadium. Meanwhile, AIG intends to keep it's deal with the Manchester United soccer team to pay $125 million to have their logo on the team's uniforms.

I have no problem with company's having corporate jets, or sports sponsorship deals. However, if you are coming to the government for assistance, get your house in order. When money is tight for me, I have to give something up. I end up brown bagging it for lunch at work, and I give up those Starbuck's lattes. How many of those 53,000 employees at Citibank could have been kept with that $400 million they are going to pay to the Mets.

Maybe, GM got the hint from their trip to DC. They have retired 2 of their corporate jets. They also announced that they were ending their sponsorship relationship with Tiger Woods a year early. These are things they should have done prior to coming to Washington. These companies need to show the government they are taking steps to help themselves before they get any help from the taxpayers.

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