Sticking for the moment with AIG, a third Teflon financial action figure is manifest as the Yale economist Gary Gorton. Feldstein may have been formally responsible for the AIG fiasco in his role on the board, but Gorton was substantively responsible. Gorton joined AIG Financial Products as a consultant in 1996, for remuneration that climbed from $200,000 per year at the beginning to more than $1 million per year toward the end. Gorton is reported to have told an AIG shareholders’ meeting in 2007, “no transaction is approved by the chief of AIG’s financial products unit if it’s not based on a model that we built.” Gorton provided the intellectual justification (and some of the code) behind AIG’s disastrous credit default swaps from 1998 onward that by all accounts caused the company to fail in September 2008.

Philip Mirowski, Never Let a Serious Crisis …, loc. 567