The problem here is that AIG has no other choice. It's largely because of government mandates that AIG must fulfill contractual obligations that involve bonuses or they'll be in trouble with the law anyway. They're screwed whatever route they take.

Forcing them to circulate money how the government sees fit just ends up undermining the principles behind private business.

Since there's no way to interact with the private enterprise without violating their fiscal independence, they should never have involved government with AIG at all. But I'm sure we all knew that.