After $210 Billion In Bailouts For AIG, Some Political Leaders Ready To Proclaim It A Waste Of Money

Bailouts create an expectation for more bailouts:

A handful of lawmakers are questioning the decision to spend up to $30 billion in government funds to rescue mega-insurer American International Group, with Sen. Bob Corker saying the money still may not be enough to keep the struggling company afloat.

“It’s a tar baby,” said Corker (R-Tenn.), a senior member of the Banking Committee. “It’s not going to go away.”

The Treasury Department and Federal Reserve spent $150 billion propping up AIG last fall and regulators have suggested that the company may require additional government support if markets continue to spiral downwards. Some analysts believe that at least another $60 billion will be required to help AIG, bringing the total government investment in the company close to a staggering quarter of a trillion dollars.

AIG reported a fourth quarter loss of $61.7 billion on Monday - the largest quarterly loss for any company in history.

We’re told that if we let companies like AIG fail that we’ll pay for it with further economic downturn. And yet, I’m wondering what’s worse. More economic turmoil now, or hundreds of billions of dollars in additional federal spending that must be funded either with new and extravagant taxes or with borrowed money, thus further blowing up our national debt so that our children have to pay for it with new and extravagant taxes.

Personally, I’d take the economic turmoil now rather than worsening our budget situation and/or passing the buck on to our progeny.

On a related note, Corker is a Republican and said “tar baby” so he’s racist.

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