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GLENN: You know what AIG is? It's a money laundering system and the government is -- they're a bunch of gangsters. It's the mob. That's what it is. They're just, they're using AIG to funnel money so you don't really notice. If you would have let AIG collapse, then the government wouldn't have had to bail out all of these other companies. But because AIG didn't collapse, they can funnel money -- we're just giving money to AIG. That one damn company, why are we -- we're saving that company. Why? We shouldn't have saved that insurance company. No, no, no, we're spending money -- how much money have we put into AIG and how much money has gone to American banks? Do you know how much American money has gone to American banks? Take a guess, Stu. To AIG, how much money have gone to American banks? How much of that has gone to American banks?
GLENN: Okay. 44, $44 billion has gone to American banks. How much has gone to foreign banks?
STU: More than $44 billion?
GLENN: $58 billion.
STU: How did I know that?
GLENN: $58 billion has gone to foreign banks. Now, why isn't America outraged by that? Because America doesn't know that fact. America isn't talking about that fact. If we would have let AIG fail, then these other banks would have had to come to us and said, hey, what are you going to do on these. And we would have then had to have the discussion, do we send money over to France, do we send money over to Germany, do we send money over to England? And that we couldn't have won. The people in Washington, they would have never gotten that past you.
STU: We're not that into stimulating.
GLENN: We're not that into stimulating. We're not into shifting wealth from our continent to other continents.
STU: That's where we draw the line.
GLENN: That's where we draw the line.
STU: Of all the stuff we do, that's where we draw the line.
GLENN: So what do they do? They save AIG. They give $44 billion to American banks, $58 billion to foreign banks. Why do they say they have to do that? Because there are contracts. These are contracts. They had a contract with AIG. They can't break that contract. $58 billion goes to foreign companies in foreign lands. $165 million goes to executives. Now everybody's outraged. How dare these people take a bonus. Well, let's do the genealogy on that bonus, shall we? Let's go back in a time tunnel... tunnel... tunnel... tunnel. How did we get these bonuses? Why do we have them? Why are people paid these outrageous bonuses? Oh, I remember. Because congress said these salaries for some of these executives is outrageous and you shouldn't pay these people this outrageous salary; that's not right. But companies like AIG and CitiBank and everybody else paid, had to, had to pay people or they wouldn't get the best people.
Now, the argument is, "This is the best people." Really? AIG went under? AIG is a gigantic corporation. Most of its divisions were profitable. Most of the divisions were worth a lot of money and making a lot of money. One or two of its divisions failed. Who's running that now? The federal government. Who's running the failed part? Who is now running AIG? Somebody that congress put in. What laws are they living by? They are living by the bailout laws. Who wrote that? Barney Frank and Chris Dodd. Chris Dodd is proud that he wrote it. In it there's a specific date. Bonuses and contracts must be honored if they were signed before this date. These contracts were signed long before that date.
Now, there's a couple of ways we're going to go on this. Barney Frank once again is saying, "This is outrage, there should be some oversight." You wrote that! If you didn't want to pay those bonuses, you shouldn't have written that into the bailout bill. By the way, the Fed has known and has been studying these bonuses for a very long time. Congress has known about these bonuses since the getgo and there's been a debate inside congress and the Fed and the treasury and the White House for months. The Fed has come out and said there's no way -- after studying them, there is absolutely no legal way we can take those bonuses away. They must be paid. Remember, requests this is an outrage. We shouldn't be paying any of these people any of this money." This was said 10 years ago. So congress says, "You can't pay them; it's got to be a certain salary cap, it's got to be all this blah, blah blah.
What happens? Because the companies have to pay people money to be able to be competitive, they come up with a bonus scheme so people are paid very little but then get a bonus at the end of the year. They're not paid like you. It's not like -- it would be like if you were working all year -- let's say you make $50,000 a year. You made $1 for the whole year and at the end of the year they give you $50,000, or $49,999, okay? That's the way it works on the Wall Street and in the banks because... they were trying to avoid all the hassle with congress!
So now imagine you've done your job, you have a contract, and the person that's supposed to pay you $49,999 comes to you now and says, "You're not getting anything but that dollar." Now, I know the numbers are different, but the concept of the principle that we have a deal is not. We have a contract. How is this solved? If you have a contract, how is this solved? This is solved through Chapter 11. When you let a company fail through Chapter -- there's Chapter 7 and there's Chapter 11. Chapter 7 is, "We're closing the doors; we ain't ever opening up again." Chapter 11, "We need to reorganize." Why? Because we have contracts we can't afford.
So then the judge comes in, the bankruptcy judge and says, okay, these contracts, you're going to have to slash this, you're going to have to slash this, you are going to have to put this aside, you're going to pay this one overtime. That way the company can get back on its feet. But no, no, no. Congress doesn't want anyone to file Chapter 11. Chapter 11 is the way that companies reorganize, change their contracts, fix the problem and do it all legally and orderly. But because that just can't happen in today's world, Paulson and Bush and Barney Frank and Chris Dodd, they decide to bail out AIG, and they decide to write in there that contracts will be honored.
So now they're making a big deal out of $165 million in contracts that they knew they were going to have to pay, they left that in there, there's no way out of that unless you allow the government just to make up rules. Contracts are no longer valid, if the congress decides they are not valid.
Let me ask you this: What does that do to contracts? You see the slippery slope? What does that do to contracts? If the government doesn't have to honor my contract, do I have to honor a contract in the other direction? Do we have -- I'm sorry. I seem to remember George Washington and the pesky Constitution, that everybody abides by the law. "Oh, no, we don't do that anymore. We pick and choose around the laws. If one's convenient, one's politically correct, we can just enforce some laws and not others so we become a society where we can enforce this contract but not that contract, we can enforce the GM contracts. Oh, the union contracts? Oh, no, no, we've got to have the union contracts. We could never come in and bust up the union contracts. Of course not, that's crazy. That's an ironclad contract. But the AIG contracts, oh, those people are just evil. They're bankers, you know."
We have become a respecter of people and not of laws. Meanwhile Barack Obama is going to be on the Jay Leno show this week. Why is he on the Jay Leno show this week? He's on the Jay Leno show this week to feed you more cake, to show you another circus. We are facing some of the biggest problems, and the media is right in bed with the government. They are not telling you -- they are not doing their job. There is -- of course, of course the New York Times gets this wrong.
I got up this morning and I thought Grassley, who said the people at AIG should commit Harry Carey, he wasn't joking. He was serious. They should commit Harry Carey because there is no honor. Well, wouldn't it be nice if there was some honor... Senator. There's no honor there. Okay, no honor there. Hmmm. The New York Times says we have to honor these contracts because if we don't, these are the people that can come out and they will know how to dismantle it on the outside and they'll take AIG down and we'll lose all of our investment. Of course the New York Times thinks that we should deal with terrorists. Of course they think that we should give in to the demands of people who are extorting money from us. That's completely consistent for the New York Times. They've made it about extortion instead of the rule of law. How could all of this have been avoided? Chapter 11. Time-tested, mother-approved Chapter 11. And now what they're talking about is going in, just put into either the House or the Senate a bill to tax these bonuses now, 95%, that the -- a special law, a special law just for AIG executives, and there's no outrage on the street at congress. A special law. After you've made the money, they will pass a bill to then go back and reach back into time and take that money from you. You tell me I'm crazy that the government is out of control. You tell me that I'm crazy because there's no common sense whatsoever.