Mining operations continued as before. Meaning horrendous messes were left behind. When the meses were discovered, ABC mining companies declared bankruptcy. Corporate assets, usually consisting only of a worn-out backhoe and a dilapidated dump truck, were liquidated for each of the companies. DEF mining companies with different well-used backhoes and dump trucks were formed to exploit the next sites.
As to ABC's sites: The state called upon the insurance company's performance bonds so the state could clean up the messes. And the state did.
Reclamation work "estimated" by the mine operators to cost about $6 million was performed, at a cost of about $70 million. All but about $250,000 was paid for by the taxpayers, after the insurance company filed bankruptcy.
Substituting A.I.G. and similar institutions for the name of the miner's small insurance company will explain much of America's current situation.
As with reclamation of strip mines, the insurance companies will file for bankruptcy. Government, via a $700 billion emergency rescue plan, will step up to the plate. The costs will be paid by taxpayers who have seen only losses and no gains. Pursuant to a rescue plan that prohibits any and all forms of congressional or judicial oversight or opportunity to object.
Except for reports, to be filed twice yearly. Something akin to the fox being required to periodically report how many chickens he stole from the hen house, without being required to return any of the stolen chickens. And who will keep this count? The fox.
The inevitable bankruptcy of A.I.G? What other option exists for a company with a market value of $12 billion and liabilities of about $450 billion on credit default swaps written to hedge funds, many of which are headquartered offshore and thus pay no taxes in the United States. For this, the government is paying $85 billion in taxpayer's money. In return, the government, meaning the taxpayers, will be entitled to receive 80 percent of the company's stock. Stock that is all but assured to be totally worthless.
For insurance company executives, financial risks of corporate bankruptcy are all but non-existent. Lehman Brothers is a prime example. On September 15, Lehman filed bankruptcy - the biggest in America's history. Hours before, the New York headquarters was scrambling for cash. Other banks were refusing to provide loans to Lehman. Banks with loans outstanding were demanding immediate repayment. Counter parties to Lehman's credit default swaps were selling out at ten cents on the dollar.
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