I can't believe they are doing that. I mean last time they ran around with knives, I gave them candy, and a very stern talking to about never doing it again.
Ok, its not a great analogy, but I do think there are a lot of parallels with the AIG debacle. Maybe a better analogy would be that last time they cut themselves badly, but a band-aid and enough anesthetics and opiates were applied so quickly that they barely noticed the pain. They were on a playground with all their friends, I didn't want to take them into a hospital, where actual treatment could take place, 'cause then the other kids would get scared.
On the other hand, that may be a whole lot more faith in the process of bankruptcy than it deserves. It does seem to me that the power to renegotiate legal agreements and a suspension of some obligations that were part of the problem sounded better than a blank check with no strings and then inflicting random consequences when angry.
2 comments:
I would definitely make that argument with the Big 3, but probably not with AIG. Bankruptcy for AIG would be very bad for the economy as a whole. Also, there is no way it would go through as a Chapter 11, it would be a Chapter 7. If the AIG's policy holders get hosed, no one would stand for the company not being liquidated.
I considered that, and figured that since they are spending money and drafting legislation anyway, there is no reason it has to be a chapter 7 or a chapter 11. Make it a chapter AIG - too big to fail, but we won't be kind when resetting your limbs, and we will give you money for very specific things.
Post a Comment