Academic

But, of course, these panegyrics in the form of policy were all sadly premature. As many African and Latin American states have taught, the state and its apparatus remains a rich prize for capture (at least for the capture of its ability to direct wealth as those in control of its ministries direct) and a central nexus point for control. Thus the new face of control is not Marxist Leninist, it is fascist--understood not in its demonized Italian post 1937 form--but in the form of a kinder and gentler oozing of control in which state and private power are blended for the specific benefit of its leaders and the general benefit of the masses.

The new face of controlled economic activity is not a Soviet or Cuban nomenklatura, but the state-private bureaucratized management of AIG. Hugh Son, AIG May Restructure Rescue Package for Second Time (Update4), Bloomberg.com (Feb. 24, 2009).

AIG had to seek an $85 billion federal loan in September after credit-rating downgrades left the company facing the possibility of more than $10 billion in collateral calls from debt investors who bought credit-default swaps from the insurer. The bailout, which includes handing the government an 80 percent stake in AIG, expanded to about $150 billion in November, partly to fund an entity designed to retire the swap contracts by purchasing the underlying assets from banks.
AIG may convert the government?s preferred shares into common stock to reduce pressure on the company?s cash flow, a person familiar with the situation said yesterday. New York- based AIG pays a 10 percent dividend on preferred stock, and none on common shares. AIG fell in New York trading.
AIG, led by Chief Executive Officer Edward Liddy, may try to repay as much as $60 billion of U.S. loans with a combination of cash, debt and equity, and by selling stakes in subsidiaries such as life-insurance units in Asia, the Wall Street Journal reported, citing unidentified people familiar with the plans.
?We continue to work with the Federal Reserve Bank of New York to evaluate potential new alternatives for addressing AIG?s financial challenges,? said AIG spokeswoman Christina Pretto, declining to be more specific.