AIG's New CEO Threatens to Quit, Gets Slammed

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Robert Benmosche, recently appointed CEO of AIG, was unfazed by the hazing he got for taking a two-week vacation before assuming his title. But now the head of America's most-hated insurance giant is threatening to resign three months into the job. What got to him? Benmosche complains that caps on executive pay spearheaded by "pay czar" Kenneth Feinberg are hamstringing his ability to keep talent. His detractors note that taxpayers shelled out billions to bail out AIG and his continued resistance to federal regulators smacks of executive arrogance. Others compliment Benmosche for boosting AIG's stock around in little time:

  • Unbridled Arrogance, writes Yves Smith at Naked Capitalism: "The government owns 79.9% of AIG. Any private sector owner who had an overwhelming majority interest and got that kind of attitude from a CEO would fire him immediately. But no, we live in a world where arrogant members of the financial services industry engage in looting, dictate terms to the government, and try to rewrite history to make baldfaced lies seem plausible. Why shoudn’t the government pressure AIG? The idea that owners don’t pressure companies... is an absurd misrepresentation. Go talk to the management of any underperforming company owned by a PE or venture capital firm. For the most part, they do not play nice, and would never tolerate Benmosche’s posturing, and he knows that. He is simply playing the media and the public for fools."
  • Good Riddance, writes Douglas McIntyre at Daily Finance: "AIG may be better off without Benmosche. The Obama administration should view the appointment of a controversial figure into a high profile job, in which diplomacy is part of the role, as a mistake. Unlike other companies that the government has given money to, AIG has quarreled with the administration on a regular basis. AIG's management needs to spend more time restructuring the firm and less time battling the government."
  • He's Performed Well Though, writes Ed Leefeldt at BNet: "AIG’s shares have already had a more than satisfactory run up, shooting from $6.60 to $56.80, with virtually all of it coming after Benmosche took charge in August. Even sarcastic former AIG CEO Hank Greenberg is complimentary of Benmosche, and certainly he is an improvement on Ed Liddy, his predecessor, who had more of the virtues of an undertaker than a CEO."
  • Benmosche's Exit Will Chasten Federal Regulators, writes Michael Corkery at The Wall Street Journal: "Convincing a new leader to take the post could prove very difficult given Benmosche’s own frustrations. But perhaps the government would be more hands-off after a potential Benmosche disaster. The irascible CEO might have destroyed his own job — but saved the AIG CEO post after all." Corkery then offers a shortlist of potential successors who are currently AIG boardmembers. The list includes Douglas Steenland, former CEO of Northwest Airlines; Robert Miller, the former CEO of Delphi Corp; Arthur Martinez, the former CEO of Sears; and Harvey Golub, the former CEO of American Express Co. 

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