OT: "bailed out"
'Fraid you've misunderstood all of this. First, it's not a bailout. In fact, if you look at it closely, it might be regarded as something closer to the opposite.
Second, this isn't Treasury money, it isn't taxpayer money, and there aren't printing presses involved. (You might want to read up on the Fed a bit).
Third, Congress had a direct say in the matter and the deal was approved by Schumer, Dodd, Frank, Boehner, and several others with whom Bernanke and Paulson met before finalizing the deal.
Since you apparently didn't check, here are the terms of the deal:
The Fed has given AIG a 2 month line of credit up to $85 billion. The credit line is secured by 100% of AIG's assets. Interest due on any amount drawn on the line will be 3-mo Libor + 850 bps, or roughly 11.3%. In addition to the collateral, AIG has been forced to give warrants amounting to an 80% equity interest if converted. It has the right to replace immediately, should it desire, the CEO/Executive Management and the Board, provided they don't run the business the way the Fed/Treasury approve.
Think about this for a minute. Let's say you own a little shop in New Jersey. You pay your taxes. You expect for your taxes, you'll be protected by the police. But one day, with the cop on the corner, you see a big thug with a baseball bat walking toward your store. He and the cop exchange glances. The cop winks, nods, then turns his back. The thug walks in your store. He begins bashing your cash register and your equipment. You are powerless to stop him. It happens very fast. He walks out. Next, in walks a Mafioso. He tells you how sorry he is that you've suffered this misfortune, then suggests that if you pay him a monthly "security fee," he can make sure the man with the baseball bat doesn't return. If not, however, who knows, the guy might come back and destroy everything else in the shop. And if you replace it, he might return and do it again. What with the business unable to produce cash to pay its rent and meet other obligations, the bank might be unwilling to lend it money except on increasingly poor terms. And in no time at all, your business would go under. Oh, BTW, the "security fee will be 80% of the profit of your business". Interested?
Now I hope you'd look at that little hypothetical and be upset on behalf of the shop owner who got shaken down and effectively had his business stolen from him by thugs. If you understand what happened to AIG, then you'll recognize the parallels, and how if there's something to be really concerned about, it isn't getting screwed out of your tax dollars, but rather that the government has, to a large degree, participated in the confiscation of private property.
Truth is, us taxpayers didn't get ripped off, we ripped somebody else off. If you inspect this deal in detail, you will see that the amount we grabbed up for our little 2-month loan with its loan shark interest rate, could amount to something on the order of $100 billion and might be more.
As for other costs and benefits, if you really and truly had an understanding of the scope and breadth of AIG's business and understood what chaos a bankruptcy filing would have generated, you would realize us citizens and taxpayers probably avoided hundred of billions in costs we'd have suffered from the meltdown and destruction.
This wasn't just a good deal for us taxpayers, it was an outrageously good deal.
