Heckuva Bailout: Citi and AIG Still Pay Hundreds of Millions in Sports Sponsorship

Posted by Jane Hamsher, Firedoglake at 10:23 AM on November 24, 2008.

In his press conference today, Obama says he wants Detroit automakers to come up with a "plan" before they can receive a bridge loan that will keep three million jobs from being lost as we teeter on the edge of a global depression. 

I guess this is the plan for Citi and AIG:

AIG, Citibank and a number of other federally bailed-out financial institutions have no plans to cancel hundreds of millions of dollars in sports team sponsorships, even as they take billions in taxpayer support, ABC News has found.

In boom times, the sponsorships were seen as a way to advertise the firms' "brands" and appeal to potential customers. Even today, at least one bank told ABC News that a naming deal was increasing its revenue. But critics, including a member of Congress, say the decision to continue them now is hard to defend.

Struggling Citibank just sealed a multi-billion-dollar emergency "backstop" deal with the U.S. government. The financial behemoth, suffering with billions in bad mortgage-related assets on its books, recently shed 53,000 workers and saw its stock price lose over half its value. Yet it's in a 20-year contract to pay the New York Mets $400 million to name the team's new stadium "Citi Field."

"This type of spending is indefensible and unacceptable to Citigroup's new partner and largest investor: the American taxpayer," said Rep. Elijah Cummings, D-Md., in a statement Monday. 

There are a million UAW pensioners living in fear right now because pontificating, sanctimonious, disingenuous creeps like Richard Shelby are on TV preaching that they must give up the retirement funds they spent a lifetime contributing to because they make Detroit "uncompetitive" with Japanese automakers in his state.  No mention is made that right-to-work states like Alabama give foreign auto makers a protective advantage by making it illegal to unionize.

Pelosi and Reid want to be reassured that no bonuses will be given out to anyone in the auto industry making more than $200,000 a year, while Wall Street bonuses will actually be more generous as a result of their bailout.  They want Detroit to promise that bridge financing money won't be paid in dividends to stockholders, yet the Treasury said it was okay for banks to pay out half of the funds they received to shareholders because "suspending quarterly dividend payments would have deterred banks from participating in the voluntary program."

Obama now says that the automakers must prove they can be profitable and create more fuel efficient cars before they will get federal assistance for a problem caused by mismanagement of the same financial institutions who had no strings whatsoever put on their loans, despite the fact that there is no proof that people will buy more fuel efficient cars when gas prices are low -- something the government can affect, but which the automakers have no control of whatsoever.

But thank gawd A-Rod can still pick up the tabs for those spending sprees  if he wants to get busy with Madonna.  I was getting worried there for a minute.

Tagged as: congress, ceos, citibank, economic crisis, aig

Jane Hamsher is the founder of FireDogLake. Her work has also appeared on the Huffington Post, Alternet and The American Prospect.