NEW YORK (Bloomberg) — Jim Tisch, the leader of Loews Corp., said the US did a "good job of killing" the hotel business by lambasting corporate travel and hurt American International Group Inc.'s ability to return bailout funds by curbing pay.

"The criticism that took place of group travel was really a death knell for the industry," Tisch said yesterday in an interview at an office of the New York-based holding company, which owns hotels. "It's easy for the politician to get the sound bite. What they are doing with those sound bites is putting maids and bellmen out of work."

Loews's hotel unit posted a $34 million loss in 2009, compared with a $40 million profit in 2008. Tisch, the chairman and chief executive officer of Loews, said group travel comprises about half the firm's hotel business, and operations suffered as lawmakers disparaged corporate trips amid the $700 billion rescue of financial firms. In 2008, bailed-out AIG cancelled about 160 events costing a total of $80 million.

Loews's fourth-quarter average room rates fell 14 percent from the year-earlier period to $217. Occupancy decreased to 61.6 percent from 65.8 percent, Loews chief financial officer Peter Keegan said yesterday in a conference call.

President Barack Obama last year said companies receiving aid should curtail travel and pay. "You are not going to be able to give out these big bonuses until you've paid taxpayers back," Obama said at a town hall meeting in February 2009. "You can't get corporate jets. You can't go take a trip to Las Vegas or go down to the Super Bowl on the taxpayers' dime."

Loews also owns natural gas exploration operations and the majority of commercial insurer CNA Financial Corp., which competes against AIG selling commercial insurance. Loews reported its third straight quarterly profit yesterday on improved results from gas exploration and Chicago-based CNA.

Loews has hired AIG staff, primarily to manage investments, who "do a phenomenal job for us," Tisch said. New York-based AIG has a harder time retaining the "best and the brightest" managers after lawmakers criticised the company's retention bonus awards and the Obama administration limited compensation for top executives, he said.

"Last time I looked we don't have indentured servitude in the United States," he said. "The situation is such that the good people have every incentive to leave to maximize their income."

AIG CEO Robert Benmosche has said the insurer is attracting leaders committed to helping the company repay its $182.3 billion bailout. Managers have "voted with their feet" in joining AIG, Benmosche said in a statement yesterday announcing the hiring of Peter Hancock, a former CFO of a predecessor to JPMorgan Chase & Co., to oversee finance and risk.

Loews's fourth-quarter net income of $403 million, or 94 cents a share, compares with a loss of $958 million, or $2.20, in the same period a year earlier.