Best explanation of AIG's woes anywhere is here.
Apparently the only white knight that can save AIG is a multi-trillionaire, and
The only multi-trillionaire around, though, is the U.S. government. Which is a strange sort of trillionaire, I know, given that it's $10 trillion in debt (and that doesn't count the present value of future commitments to Social Security and Medicare and yada yada yada). But it could swing the deal financially.