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Secretary of the Treasury, Timothy Geithner

The United States Treasury concealed $40 billion in likely taxpayer losses on the bailout of the American International Group earlier this month, when it abandoned its usual method for valuing investments, according to a report by the special inspector general for the Troubled Asset Relief Program.

“In our view, this is a significant failure in their transparency,” said Neil M. Barofsky, the inspector general, in an interview on Monday.

In early October, the Treasury issued a report predicting that the taxpayers would ultimately lose just $5 billion on their investment in A.I.G., a remarkable outcome, since the insurance company was extended $182 billion in taxpayer money in the early months of its rescue.

Mr Geithner, our President’s right-hand man when it comes to fiscal policy was deeply involved in the TARP program (initiated by former President Bush who had been told by Bernanke, Geithner and all the other high-up former Goldman-Sachs collaborators-turned-government-employees that the sky was falling and that unless a trillion dollars was coughed up – no questions asked, no questions to be asked – the world would collapse).  He had previously been Chairman of the New York Fed branch in the 90’s, during which all the toxic soups of slice ‘n dice ’em derivatives had been cooked up and sold around the world, leading to massive bonuses for the CEO’s of Goldman-Sach, BofA, Lehman Brothers (r.i.p.), JP Morgan and the other powerhouses of Wall Street.  Prior to his appointment by Mr Obama Mr Geithner had been caught fudging some numbers on his taxes.  So when it comes to numbers, Mr Geithner is a bit fast and loose.  As head of the Treasury Department he is directly responsible for issuing this report.   A little conflict of interest?

Neil Barofsky, Inspector General

Mr Barofsky:

I  been looking at your books, Mr Geithner, and it looks like you been cookin’ ’em.  Like according to my figures AIG is down for a 45 billion buck loss, and you got ’em down for a measly 5 billion in the hole.  What gives?  You did this on your taxes, now this?

Mr Geithner:

Ah, geez Mr Barofsky, I mean, like what’s a little 40 billion off among friends?  I mean we’re all in this together.  Besides my boss told me to try to make things look good, especially now, y’know, before the elections and all.  I mean 40 billion – that’s nothin’.  Think we gave a trillion just 2 years ago.  And if we hadn’t done that the world as we know it would be gone.  Got me?  And besides, you ain’t got no enforcing powers, so suck my…

And for those with a taste for schadenfreud, though he wasn’t at the helm during the previous decade or so, here’s a late news item:

7:46 p.m. | Updated The American International Group said Monday that its chief executive, Robert H. Benmosche, has cancer and that he is undergoing “aggressive” treatment.

Robert H. Benmosche, in happier days at his villa in Croatia

Somewhere along the line I read that stress is a killer and can prompt cancer along.    Mr Benmosche is 66.

Ellen McClaughlin in Angels in America


  1. So “Angels In America” has entered the pantheon of 20th Century US theatrical literature along with “Death of a Salesman” and “Virginia Woolf”. Jon, didn’t you say you knew the woman who played the angel?

  2. Ellen McClaughlin played the lead actress in The Bed You Sleep In. She was very very good in it.

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