The "AIG Effect" continues to impact companies and their travel plans and ultimately the hotel industry is the one hurt the most. An interesting story in today's New York Times discusses the difference between a legitimate business event and an extravagant party, and how blurry those lines can be. Corporate America is pulling back on both to avoid the perception of lavish spending during these tough times.
The latest company under the microscope is Wells Fargo, which like AIG received billions in federal bailout money, but unlike AIG, it canceled upcoming plans for a recognition event at the Wynn Las Vegas and Encore after news of the meeting received plenty of bad press. The company went on to cancel all recognition events this year, according to the Times story, which isn't good news for event planners, hotels and resorts.
The spotlight even shined on government as Democrats in Congress attended their annual retreat at Kingsmill Resort & Spa in Williamsburg, VA and Republicans headed to Homestead in Hot Springs, WV. Some watchdog groups, according to an Orlando Sentinel story, are questioning the luxurious locations.
And there's more. After my original post, I saw a comment from James Tisch, CEO of Loews, echo the same thoughts in this story. The money quote from there: “Congress has done a great job of killing the resort hotel business with the way they've criticized a number of financial firms for having conferences,” Tisch told analysts. “I just heard this morning of another investor conference that was canceled by another major investment firm because of fear of being criticized by members of Congress.”