Paul Krugman: Plutocrats Feeling Persecuted

Robert Benmosche, the chief executive of the American International Group, said something
stupid the other day. And we should be glad, because his comments help highlight an important
but rarely discussed cost of extreme income inequality — namely, the rise of a small but powerful
group of what can only be called sociopaths.

For those who don’t recall, A.I.G. is a giant insurance company that played a crucial role in creating
the global economic crisis, exploiting loopholes in financial regulation to sell vast numbers of debt
guarantees that it had no way to honor. Five years ago, U.S. authorities, fearing that A.I.G.’s
collapse might destabilize the whole financial system, stepped in with a huge bailout. But even the
policy makers felt ill used — for example, Ben Bernanke, the chairman of the Federal Reserve, later
testified that no other episode in the crisis made him so angry.