Thursday, March 19, 2009

Bonus Gate: How Obama, Geithner and Dodd Misled the Public on AIG Bonuses

PhotobucketWill Obama, Geithner or Dodd pay a price for their deception?

Remember back in February when the House and Senate rammed through the massive stimulus bill without even giving our elected officials the time to read the final version before voting on it? We were told this was an emergency and yet the bill was passed and then sat around for four days before Obama's big photo op in Denver to sign it.

Many of us thought that the reason for the bum's rush through Congress was to prevent a popular uprising from erupting over the hundreds of billions of pork and wasteful spending in the bill. Many feared there may be other surprises tucked into the bill which would come back to bite us later. Little did we know how soon that would happen.

Congress was all in a lather this week over the $165 million in bonuses paid to AIG executives, presumably made possible with the $165 BILLION the U.S. Government has given the insurance giant to help it with it's financial woes.

Lost in all the congressional caterwauling is the fact that Democrats voted FOR the final bill which contained a provision to protect the AIG bonuses. Tucked away behind all those billions in pork was this:

From page H1412 of the Final Stimulus Bill, “SEC. 111. EXECUTIVE COMPENSATION AND CORPORATE GOVERNANCE:

“(iii) The prohibition required under clause (i) shall not be construed to prohibit any bonus payment required to be paid pursuant to a written employment contract executed on or before February 11, 2009, as such valid employment contracts are determined by the Secretary or the designee of the Secretary.”
Q: How did those few lines get inserted into the bill at the last minute which no one had the time to see before voting on it?

A: Democrats did it!

Readers may recall that Republicans overwhelmingly voted against the bill in both Houses of Congress. Republicans were shut out of the conference between House and Senate leaders which led to the final version of the bill which Democrats overwhelmingly voted for.

And it was in that conference that Senate Banking Committee Chairman Chris Dodd inserted the provision above. It's worth noting that Dodd was the number two recipient of campaign contributions from AIG at $103,900. The number one recipient of AIG money was BARACK OBAMA at $104,332.

How do we know Dodd inserted the language in the bill? He admitted it. But only after a day of making adamant denials that he had anything to do with it. It's one of the most blatant lies ever told on an issue of this magnitude in some time.

But of course Dodd insists that he was only acting at the behest of Treasury officials. Just who are those officials? Well, there is only one Treasury official confirmed by the U.S. Senate at the level that would interact with a U.S. Senator on a critical legislative matter and that is Treasury Secretary Tim Geithner. Out of 24 top appointments at Treasury, he is the only one who has been confirmed and only 3 minor nominations have been made for the remaining offices. There is no one else at the department with the authority to make this request to Dodd.

But both Geithner and Dodd are now blaming unnamed "staffers" for the whole mess. Do these people have no shame?

Obama's Role

President Obama has apparently been too busy bashing Rush Limbaugh and throwing expensive White House parties to bother much with little details like trillion dollar stimulus bills or making sure his economic team at the Treasury Dept. is in place.

But Obama did take time off from picking a winner in the NCAA Basketball championship to defend his embattled Treasury Secretary with the usual straw men defense that has become a hallmark of his young Administration. On the White House lawn Obama held an impromptu press conference defending Timmy Geithner in which he compared him to Alexander Hamilton (the guy on the $10 bill) and said "Tim Geithner didn’t draft these contracts with AIG." No one ever said Geithner did draft those contracts, but he, or Treasury officials working for him, did intervene directly in the legislation which protected them.

Later at a town hall meeting in California Obama insisted "We didn't draft these contracts. We've got a lot on our plate," and went on to say that "it's my job to make sure that we fix these messes, even if I don't make them."

He's got a lot on his plate? What kind of job did he think he was getting into? And to say that he didn't make this mess? It was his Treasury Dept. which protected these bonuses and he is responsible for the mess they have made of not only the AIG bonus business but the mishandling of nearly every economic initiative coming from his Administration. Writing at the Washington Post Michael Gerson summed it up this way: "So Obama seems to be saying: I'll take credit for taking the blame for something that is entirely the fault of others. Positively Clintonian. "

What Next?

They say the cover up is the worst part of any scandal. While that certainly would apply if a Republican were involved, somehow I doubt the same will be true in the AIG Bonus scandal and resulting Democrat cover up.

It's clear Dodd is a liar, Geithner, the man Democrats said was indispensable, is an incompetent failure. But the real failure here is that of President Obama. He's spent more time bashing Rush Limbaugh and the Republicans than he has managing the business of government.

And worse still, his clever but transparent deception shows us that he has contempt for the truth and the American public he believes he can continue to fool even as he continues in his deceptive, bungling, and yes, FAILING performance.

No matter how much he would like to Obama cannot blame the AIG mess on President Bush. It was Obama, not Bush, who signed the bill which protected the AIG bonuses. And it is Obama's, not Bush's, understaffed Treasury Dept. that hasn't been doing such a poor job in managing the hundreds of billions of assets the government has undertaken to stabilize the financial system.

Finally, it shows a real weakness of character for Obama to insist the final responsibility lies with him while insisting that his action or inaction isn't responsible for the mess in the first place.

But then, what else would you expect from an untested, inexperienced young man with no prior qualifications to the high office he now holds?

Just remember, we told you so!

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