Six banks with $540 billion in bailout money still flying 27 corporate jets

[Joanne98]

Wonder what happened to the hard earned money you paid in taxes? I can't account for all of it but $540 billion that went to six financial institutions is being used, in part, to operate 27 corporate jets. I may be the only one who feels this way, but I don't think the survival of the global economy depends on using taxpayer money to pay for financial executives to fly on their own corporate jets.

Here are the six financial institutions with the amount of taxpayer money they received and the number of corporate jets they're still flying:

American International Group Inc (NYSE: AIG). $150 billion, seven corporate jets
Citigroup Inc. (NYSE: C). $330 billion, four jets. (The $340 billion includes Citi's initial $25 billion in TARP money plus its more recent $305 billion in loan guarantees.)
Wells Fargo & Co. (NYSE: WFC). $25 billion, one jet
Bank of America (NYSE: BAC). $25 billion, nine jets -- its CEO Ken Lewis used $127,643 worth of its corporate jets
JPMorgan Chase & Co. (NYSE: JPM) . $25 billion, four jets -- its CEO Jamie Dimon's personal use of its corporate aircraft totaled $211,182 in 2007
Morgan Stanley (NYSE: MS). $10 billion, two jets -- its CEO John Mack's personal use of its corporate aircraft totaled $358,882 in 2007
Will anything be done to stop this? Not under the current administration. Meanwhile, the hundreds of billions of our taxpayer money is not going to make loans like it was supposed to. Instead it will go to pay bonuses -- by my estimate, even though bonuses for 2008 will be down by 50%, that's still $16.6 billion worth of taxpayer money going to pay millions of dollars to the very people who got us into this mess.

Meanwhile, corporate jet makers are trying to defend the indefensible by arguing that their executive play toys are flying offices. Well guess what? If executives can't get meaningful work done flying business or first class on a commercial flight then maybe they should just find a less expensive way to do business -- maybe they can sit in their offices and use online videoconferencing instead of flying.

If my money is going to bail them out of their bad business decisions, I don't want them wasting it on these executive toys.

Peter Cohan is President of Peter S. Cohan & Associates. He also teaches management at Babson College and edits The Cohan Letter. He owns AIG, Citigroup and Wells Fargo stock and has no financial interest in the other securities mentioned.

http://www.bloggingstocks.com/2008/12/21/six-banks-with-540-billion-in-bailout-money-still-flying-27-cor/

[oldnslo]

1. It should be clear by now

That all these executives haven't been able to do their work effectively on their corporate jets, either, or their companies wouldn't need the goddamned bailouts.
I'm all for jettisoning the executives from their own jets at about 30k feet over the great lakes, sans 'chutes. Screw the cokesacking bastids.

[natrat]

2. they need the jets to fly the bailout money down to their cayman island accounts

[Joanne98]

4. LOL

[antipode]

3. Same should go for congressmen, governers and presidents.

They work for us and there's no reason to provide a fleet of 747s to our Ceo.

[fed_up_mother]

7. Presidents?

I don't want my president flying commercial! Imagine the disruption at the airport. UGH

Air Force One has top notch security as it should. That's ok with me.

[saigon68]

5. Hogs swilling at the "PUBLIC TROUGH"

[Citizen Number 9]

6. Jets are valid business tools.

But now that some of us appear to be part owners in some of these financial institutions, maybe some of you should go to the shareholder meetings and start a groundswell. To get rid of the aviation departments.

I mean, the worst that could happen is that the institution could be hurt competitively and lose some money. If you read the news, many people have already written off the public investments in this bailout, so there won't be any real surprises.

[CoffeeCat]

8. Why did Wells Fargo get bailed out?

I thought Wells Fargo was a healthy bank. I didn't hear that they
were in trouble.

I'm wondering why they rec'd a chunk of the bailout money, $25 billion.

I don't recall hearing much about Wells Fargo before the bailout or when Paulson was asking for funds.

We heard a lot about Washington Mutual, AIG, Morgan Stanley, Citigroup, etc.

Did I miss something?

[Mike 03]

11. Wells IS a healthy bank. What do you mean bailed out?

Paulson specifically ASKED the healthy banks to participate in taking a chunk of the money.

It's much more important that healthy banks take it than unhealthy banks take it in terms of lubricating the credit market.

EDIT for clarity.

[CoffeeCat]

14. Ok, now I'm even more confused...

This WAS a "bailout" correct? That's what the $700 billion was called, during that entire
process, in which Paulson spoke to Congress.

Ok, so if we were helping healthy banks, then that sparks a few questions.

Banks--it turns out--aren't using the bailout money to extend loans to consumers. It's
more difficult than ever to get a loan. So, if Paulson--as you said--asked healthy banks to
participate, in order to infuse more cash into the banking system and then lend it out to consumers--
where is that money?

If Wells wasn't in trouble and was healthy, and they took $25 billion that was supposed to go toward
business and consumer loans--and there isn't a wellspring of loan action, then where is that money
and why did Wells need it in the first place?

[sarcasmo]

13. Paulson buddies. All Greedy bastards.

[JohnWxy]

9. Recommended!

[Mike 03]

10. This is a fraction of a fraction of a fraction of a percent of the problem.

It just has aggregate symbolic value for people are just furious and don't understand balance sheets or what corporate management does.

[Citizen Number 9]

12. So true.

There is a lot of emotional venting here without regard to what the truth actually is.

It would be nice if we could get together and learn about the issues without having to weather the rudeness of some narrow-minded ignoramuses.

Folks should save that for their elected representatives. They actually get paid to hear it.