In my previous life before law school I worked as a computer programmer. For most of that time I worked for various computer consulting organizations, going from company to company as one project finished and I moved on to another.
The kind of experience exposed me to many management styles. I saw companies that were run well; other companies that were run not so well; and companies that were in pretty bad shape.
In the late 1990s the world of computer consulting took me to AIG.
Only superlatives can describe what I saw while working at AIG's computer operation. It was the most mismanaged company of any type that I have ever seen. Nearly every company has some bad practices. AIG managed to adopt nearly every bad practice imaginable at the same time.
At the high level, the management at AIG was prone to making rash decisions without thinking through the consequences. They also had a tendency to throw money at problems rather than coming up with efficient solutions.
A well-publicized example of rash action at AIG occurred in 1994. That year, AIG fired about 250 computer programmers and replaced them with lower-paid Indian programmers imported on H-1B guest worker visas. (One of the things I worked on at AIG involved cleaning up the inevitable resulting mess).
AIG is still big on importing cheap foreign labor. In 2007, the various AIG companies submitted 196 Labor Conditional Applications for H-1B visas.
At the low level, two features of AIG stand out in my memory. Senior managers yelling obscenities with their door open so the entire floor could hear is something one rarely encounters in computing organizations. AIG is also the only company I have seen where software development teams sabotaged other teams. AIG was simply a complete circus.
The year I spent at AIG was a milestone in my career. For after working at AIG, it became impossible ever again to say, This is the most screwed-up company I have ever seen.
At the time AIG was reporting large earnings. We outsiders, who were working there temporarily, could not comprehend the paradox of how a how a company in such chaos could actually make money.
Now we know the answer: It was all a house of cards.
So why are you and I bailing out this company? In a free market, the penalty for mismanagement is going out of business.
America owes AIG nothing. AIG has no loyalty to America or the American people. They were willing to replace Americans with foreign workers in a futile attempt to save a few dollars.
No event has more demonstrated how connected our politicians are to campaign cash and removed from the will of the public as the recent Wall Street/AIG bailout has. The large investment in politicians these companies made was bargain compared to the trillion-dollar payoff.
Now we see the fruits of our generosity. Not a week has passed since the public bailed out AIG and business as usual is back. AIG sent executives to a resort spending $440,000 in the process, including $23,380 in spa treatments. [AIG Execs' Retreat After Bailout Angers Lawmakers, By Andrew Taylor (AP), October 7, 2008]
Somehow, this did not surprise me at all.
When are the American people going to rise up and put a stop to this?
John Miano (email him) was a computer programmer for 18 years before going to law school. He has written two books on computer programming as well as numerous technical articles for various computer publications. He has also written articles on the state of the computer industry for publications ranging from ComputerWorld to USA Today. He was also the founder of the Programmers Guild, a professional organization for computer programmers.