AIG CEO gets slammed for lynching comments

Robert Benmosche's comparison of public outrage about bonuses at his company to hanging blacks in the old South isn't going over well.

By Jonathan Berr Sep 25, 2013 10:57AM
AIG CEO Robert Benmosche on March 19, 2013 (© Richard Drew/AP Photo)AIG (AIG) chief executive Robert Benmosche, who at the height of the financial crisis demanded that he be able to use corporate aircraft for his personal use, shot his mouth off again. This time, he likened opposition to the insurance giant's executive bonuses to the struggles of the civil rights movement. Apparently, he was serious.

Speaking to The Wall Street Journal, Benmosche claimed that public outrage over AIG employees getting rewarded after the insurer got a multibillion government bailout "was intended to stir public anger, to get everybody out there with their pitch forks and their hangman nooses, and all that -- sort of like what we did in the Deep South [decades ago]. And I think it was just as bad and just as wrong."

The cantankerous executive has been forced to issue a public apology for his "poor choice of words."

U.S. Rep. Elijah Cummings, D-Md., the  Democrat on the House Committee on Government Reform and Oversight and one of the leading African Americans in Congress, doubts Benmosche's sincerity.

"It's insulting to any taxpayer that helped bail AIG out," he told WBAL radio in Baltimore. "You can't just make statements like that and not get push back. I think he needs to go."


Perhaps that's an overreaction, but Benmosche's comments are further evidence of the disconnect between Wall Street and Main Street. Many people think the wealthy's lot has improved while their own economic situation is little changed or even gotten worse. A poll released Wednesday by Bloomberg shows that fewer people expect the economic recovery to strengthen this year. 

AIG seems to have survived its government takeover just fine. It's share price has gained about 49% over the past year. Taxpayers made out as well, too, earning a $22.7 billion profit on the bailout after Uncle Sam sold all its shares in the insurer.

Maybe this could be a "teachable moment" for Benmosche, whose quest for a private jets was wisely shot down by the company's board. His view that AIG's workers shouldn't be penalized for the actions of a few rogues is understandable, if a bit politically tone deaf. Punishing the many for the actions of a few is unfair, and AIG workers also got death threats over the issue, which is inexcusable under any circumstances.

Likening the outrage over government bailouts to the deadly struggle for civil rights, however, shows a remarkable ignorance of both the past and present. Benmosche is going to have to back his words with deeds if he hopes to undo the damage he caused AIG's brand.

Jonathan Berr does not own shares of the listed stocks. Follow him on Twitter @jdberr and at Berr's World.

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154Comments
Sep 25, 2013 1:54PM
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"Many people think the wealthy's lot has improved while their own economic situation is little changed or even gotten worse.".

People just don't think it, they KNOW it.
Sep 25, 2013 11:12AM
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This wouldn't be an issue if we had just let the free market handle it.  AIG wouldn't be in business anymore, other companies, both new and existing, would have picked up their market share, hired many of their employees, and life would have gone on just fine.  Instead, the gov bailed out another politically-connected campaign contributor, who made terrible management and financial decisions, and we all suffer for it.
Sep 25, 2013 1:53PM
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Where is the "Paula Deen" level of outrage for this idiot's comments?  I don't see him losing his job.
Sep 25, 2013 1:46PM
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Because everyone knows that if you have a $10,000 suit on, you deserve corporate welfare.

Now then, let's get those people picking lettuce in the fields to do it for 4 bucks an hour, damn pilferers.

Sep 25, 2013 1:56PM
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Just another example of the "we didn't do anything wrong by stealing your money" mentality. After all these folks are the "wealth creators" right?

 

It never ceases to amaze me that when these CEO's get caught with their hands in the dirty books they always cry "the few bad apples" ruined it for all of us. "we (the board) didn't know what they were up to" Really? So its not that you are a crook just incompetent right?

 

The double speak and spin generators are off to the races whilst these high priced thieves are off to the Bahamas leaving the rest of us holding the bag of burning sh**.

 

This guy needs a visit from Dr Kavorkian

Sep 25, 2013 2:13PM
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The fact is that many of these people at AIG took part in intentional deliberate fraud and not only should they have NOT received anything resembling a bonus - they should be in prison. The United States has not been a "free market society" for decades. Those that run the corporations, run the government of the U.S.A. by purchasing that hideous group of whores that we still somehow call our Congress. They do so with intentional malice and greed as proven by the outrageous comments made by this particular psychopath. The overwhelming majority of them are not content with living decent comfortable wealthy lives, they must mutilate their employees lives and the lives of others in order to define their fraudulently entitled, narcissistic, rancid existences. When are the people of this country going to wake up and realize we must vote out all of the whores in Congress, imprison the bought and paid for judges and demand the imprisonment of these corporate thieves and murderers?  
Sep 25, 2013 2:07PM
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the taxpayer has made 22.7 billion dollars, so.....where's our check?
Sep 25, 2013 2:13PM
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Talk about your "entitlement society".   I wish I could use the corporate jet for private use.   Oh wait, we don't have a corporate jet.   We have mileage reimbursement.
Sep 25, 2013 2:12PM
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There are no Russians and there are no Yanks,

Only corporate criminals playing with tanks.

Sep 25, 2013 2:04PM
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Wow! The inequality in America, really shows how damaging it is in more than just monetary terms.  Wow!
Sep 25, 2013 2:18PM
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SO OUT OF TOUCH WITH THE REAL PEOPLE.
Sep 25, 2013 2:12PM
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Another loser at the helm and we all suffer and put up with it over and over.  I for one have nothing with AIG or ever will again after this bailout mess and all the subsequent bonuses.  So much for accountability.  In the end if they get forced to give back what they gave themselves all they will do it take it out on the real workers and cut the force or no raise so nothing ever will change in the golden parachuter age.
Sep 25, 2013 2:29PM
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Here's a fact about this company. Before they payed back their bailout money to the US government, AIG executives decided to get rid of a lot of American workers and hire workers over seas. That's a slap in the face isn't it? The American people bail this company out and they do that to many loyal employees. It never amazes me the power of greed and stupidity.
Sep 25, 2013 2:29PM
Sep 25, 2013 2:19PM
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Benmoshe is just another of those who cheat their customers, exploit their employees, rob & betray their countries for money.  Clearly a sociopath.  I don't want anything bad to happen to him, quite the contrary, even though his actions make him a danger to himself & others.  As so many of you obviously know, that's the requirement for involutary institutionalization.  So let's get this poor schmuck the help he so desparately needs.

 

What do you want to do with sociopaths?

Sep 25, 2013 1:41PM
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The US never has had a free market economy.
Sep 25, 2013 1:57PM
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Does this man have no PR support that can help him choose his words more wisely?
Sep 25, 2013 2:20PM
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It's too bad we couldn't lynch a couple of these guys to get the rest to fall in line.
Sep 25, 2013 2:52PM
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My company keeps asking me to donate to the United Way. I agree that the organization provides a lot of help to local communities. But I will not do it thorugh them, as a matter of principle. The United Way CEO makes 1 million dollars a year as a salary.
Sep 25, 2013 2:57PM
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The real wealth creators are people like Steve Jobs, Bill Gates, Warren Buffet, Henry Ford, etc.  Their companies have employed hundreds of thousands of people, provided retirement, stock options, benefits and a fair wage to their employees.  Many of those employees go on to start their own companies and employee even more people.  Plus, the products and services these companies offer are things we use everyday, things that move our economy, our innovation and our ingenuity forward.

This idiot, Robert Benmosche, is not a wealth creator.  He is a pawn, used to manipulate the financial markets.  For his 'service' and his willingness to lie, cheat and steal, he is paid like a king.  Our government ought to be ashamed of themselves for supporting this POS garbage.

Yo!
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