Networks Quick on AIG Scandal, Not on Fannie, Freddie

     On the day when former American International Group Inc. (AIG) executives testified before the House Oversight Committee, reports surfaced that the company spent $440,000 on a retreat for independent agents. The trip occurred after the $85-billion federal bailout of the company was announced in September.


     “Last month the government lent AIG $85 billion to keep it afloat. But just a week later, after both CEOs had left, company executives attended an exclusive California resort at a cost of $440,000,” CBS anchor Katie Couric said on the Oct. 7 “Evening News.”


     But it wasn’t exactly company executives gathered at the St. Regis resort. They weren’t even directly employed by AIG, but were independent agents who sell the company’s products. The agents were being rewarded as top sellers, according to AIG spokesman Nicholas Ashooh, as reported by Bloomberg.  


     Joe Norton, an AIG spokesman told the Los Angeles Times the event had been incorrectly labeled an executive retreat by lawmakers and members of the media. “It was not an executive retreat,” Norton said. “It was a meeting to reward and incent independent sales agents.”


     NBC chief investigative correspondent Lisa Myers made the same claim – that company executives were abusing the taxpayer on the Oct. 6 “NBC Nightly News.”


     “The luxurious St. Regis resort on the coast of the southern California – only days after taxpayers provided $85 billion to bail out insurance giant AIG, company executives came here for a week-long retreat,” Myers said. “Wining, dining and golf – the company’s cost: $440,000, including $23,000 for spa treatments.”


     ABC investigative correspondent Brian Ross echoed the same exact sentiment – AIG executives who “treated themselves” on ABC’s Oct. 7 “World News with Charles Gibson.”


    “One week after taxpayers bailed them out, AIG executives treated themselves to a week-long trip to this luxurious resort – the St. Regis hotel and spa at Monarch Beach, Calif.,” Stark said. “Just back from the brink of bankruptcy, AIG spent $440,000 on oceanfront rooms, rounds of golf and more than $23,000 for the resort’s spa and salon.”


     And while all three newscasts report under the premise they’re non-partisan, balanced and fair – their tone was remarkably similar to MSNBC “Countdown with Keith Olbermann” Oct. 7 “Worst Person in the World” segment. An openly partisan Olbermann gave his “Worser Person in the World” award to what he labeled as the AIG executives.


     “The runners-up – the top executives at AIG,” Olbermann said. “Produced at a congressional hearing this morning – hotel bills from a resort in Monarch Beach, Calif., for a corporate retreat costing $440,000. It was by executives from the AIG insurance company less than one week after we bailed them out to the tune of $85 billion. Twenty-three thousand dollars of that went to spa treatments. Well, just because they drove their company into the ground, that’s no reason for their executives’ skin to be denied the gift of healing that is the anti-aging, dermal-booster Hollywood glow treatment at three bucks a minute.”


     Democratic presidential nominee Sen. Barack Obama referenced the retreat in his opening remarks at the Oct. 7 presidential debate from BelmontUniversity in Nashville, Tenn.


     Though it’s reasonable to question those expenditures, the treatment of AIG is much different than the former executives of the now-nationalized government-sponsored enterprises Fannie Mae and Freddie Mac.


     Largely ignored by the media were the abuses of former executives of Fannie Mae and Freddie Mac. Fannie’s former CEO, Franklin Raines, a former Clinton budget director and adviser to Obama, was embroiled in an accounting scandal involving changing his own pay procedures for higher compensation.


     Also overlooked by the media in the wake of the Fannie and Freddie bailout, as pointed out in an Oct. 7 column by Media Research Center president Brent Bozell, was former Fannie Mae CEO Daniel Mudd. Mudd received $13.4 million, plus $5.4 million in stock awards in 2007, despite the Fannie’s heavy losses and eventual bailout.


     “Mudd resides in ‘an opulent Washington, D.C. mansion replete with expansive gardens, servants' quarters and a home theater,’” Bozell wrote.