Instead of paying for insurance with its own funds, St. Paul insisted that the RNC pay for liability insurance covering police misconduct during the Republican Convention, in effect giving the Police Department $10 million worth of free shots at journalists and protesters.
The RNC chose Lexington Insurance, a unit of the soon-to-be-bailed-out AIG to write this policy. The bailout deal gives the federal government effective control over AIG (they've already appointed new management), and puts ultimate responsibility for claim payments to the taxpayers - us. So when Amy Goodman and the rest collect their damages, we'll be paying for this outrage.
And that's not the only problem here: if AIG wrote a lot of policies like this one, it's hard to understand why they didn't go belly up years ago - the rate was a bargain $1.1 million, and legal defense expenditures are not even included in the $10 million limit. Was it intentionally written below market price? Is the difference an illegal campaign contribution?