After U.S. Rep. Elijah Cummings questioned him from Congress, American International Group chief executive Edward Liddy, who's working for $1 a year, went on CNBC's Squawk Box this morning to defend spending $400 million in bonuses for 2,000 senior managers at his company, which is dependent on more than $140 billion in U.S. government financial support after Liddy's predecessors ran it into the ground with stupid financial investments.

"To pay back every single penny that has either been loaned to us or invested in us," Liddy said,"we have to sell 70% of our company." But to make those businesses saleable, "you have to keep the people in place.... If you don't use retention bonuses -- those people are some of the best in the insurance industry, they will go elsewhere and we won't have anything to sell ... and we can't pay back the federal government. We want to pay back the federal government.

"Now, with respect to a large bonus, there are not many of those, and that would go to a person probably running a business that generates $25 or $30 billion in revenue and makes between $2 and $4 billion a year. We want that person locked in place...

"We need to get back to being a public company, not be on the dole, if you will, from the federal government and we need to do that as quickly as possible. It is good for the taxpayer and the company."