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The Federal Reserve Bank of New York will be compelled to hand over documents related to American International Group Inc.s government bailout after Edolphus Towns, chairman of the House Oversight Committee, said he will issue a subpoena.
Explosive new e-mails released last week could see Treasury Secretary Timothy Geithner embroiled in criminal charges for his role in the cover up that exposes the monumental criminality behind the $182.3 billion dollar bailout of American International Corporation.
Former AIG CEO Maurice Greenberg testified today before Congress. Greenberg left AIG in 2005 and blames AIG management for the company's failure, not its business model.
Really? Bailouts don't work? I seem to recall hearing a lot of chatter over this for the past seven months!
Greenberg adds that American taxpayers got a raw deal.
In essence, Greenberg is saying socialism will fail. Using taxpayer funds to "control" and "manage" U.S. companies will ultimately never work.
It's socialism; and socialism has failed every time it's been tried.
I love this woman. What a shining star for the future of the GOP.
VIDEO 1: She rips Geithner a new one!
VIDEO 2: Highlights everything from her grilling today of Tim Geithner over the constitutionality of his banking plan to debating border security during her campaign to blasting James Carville for his character assasination of Sarah Palin.
Vice President Joe Biden's economic adviser warned Sunday that a congressional plan to tax American International Group Inc. executives' bonuses may go too far in using the tax code as a tool for retribution.
President Barack Obama has not said whether he would veto some version of a House-backed plan to heavily tax the $165 million in bonuses. Biden economist Jared Bernstein said it's important to look at what version of the proposal comes out of the Senate.
"I think the president would be concerned that this bill may have some problems in going too far -- the House bill may go too far in terms of some -- some legal issues, constitutional validity, using the tax code to surgically punish a small group," Bernstein said in a television interview. "That may be a dangerous way to go."
The Constitution says the government can’t interfere in private contracts–and the AIG bonus agreements were struck in early 2008, when the company wasn’t under government control.
The Fourth Amendment guards against searches, arrests, and seizures of property without a specific warrant or a "probable cause" to believe a crime has been committed. Some rights to privacy have been inferred from this amendment and others by the Supreme Court.
Where is the crime? No penalties were written into the original TARP bailout.
This act also violates the Equal Protection Clause of the 14th Amendment! You cannot just tax one individual more than another because you don't like it!
Well Halle-freaking-lujah! At least Obama is smart enough to realize that HR 1586 -- legislation passed this week by the House to tax AIG bonuses at 90% -- is unconstitutional!
"I mean you're a constitutional law professor," Kroft remarked. "You think this bill's constitutional?"
"Well, I think that as a general proposition, you don't wanna be passing laws that are just targeting a handful of individuals. You wanna pass laws that have some broad applicability. And as a general proposition, I think you certainly don't wanna use the tax code to punish people," the president replied. "I think that you've got an pretty egregious situation here that people are understandably upset about. And so let's see if there are ways of doing this that are both legal, that are constitutional, that upholds our basic principles of fairness, but don't hamper us from getting the banking system back on track."
"You've got a piece of legislation that could affect tens of thousands of people. Some of these people probably had nothing to do with the financial crisis. And some of them probably deserve the bonuses that they got," Kroft said. "I mean is that fair?"
"Well, that's why we're gonna have to take a look at this legislation carefully. Clearly, the AIG folks gettin' those bonuses didn't make sense. And one of the things that I have to do is to communicate to Wall Street that, given the current crisis that we're in, they can't expect help from taxpayers but they enjoy all the benefits that they enjoyed before the crisis happened. You get a sense that, in some institutions, that has not sunk in; that you can't go back to the old way of doing business, certainly not on the taxpayers' dime," Obama said. "Now the flip side is that Main Street has to understand, unless we get these banks moving again, then we can't get this economy to recover. And we don't wanna cut off our nose to spite our face."
I have no problem with setting stipulations on companies who receive government aid moving forward.
But this plan calls for Big Brother-style Government to regulate all banks, investment firms and possibly other companies!
Legislation such as the law passed last week in Congress to tax AIG bonuses is unconstitutional. and violates every free-market economic principal!
It's hard to imagine that a government who will run a $10 Trillion deficit over the next ten years will help Wall Street.
Further, Obama has detested Wall Street since the early 80s when his first job out of college was on Wall Street. In his memoir, "Dreams of My Father", Obama writes:
Eventually a consulting house to multinational corporations agreed to hire me as a research assistant. Like a spy behind enemy lines, I arrived every day at my mid-Manhattan office and sat at my computer terminal, checking the Reuters machine that blinked bright emerald messages from across the globe. As far as I could tell I was the only black man in the company, a source of shame for me but a source of considerable pride for the company’s secretarial pool.
I'm not entirely sure what the motivation is for Obama's war on investors, but it seems increasingly real.
It is unfair and unconstitutional for the White House and Congress to attempt to regulate a private company's payroll. It's ridiculous. The Government cannot tell a board of director's how to draw-up a compensation contract.
Government regulation and rules are what got us into this mess and adding stricter control is dangerous.
The fury and outrage over the AIG bonuses is not originating from Main Street -- it is a calculated Alinsky-esque political ploy created in Washington.
And it is shameful that Obama is using the AIG bonus scandal and other efforts to demonize Wall Street.
But what else should be expected from a Socialist with Communist leanings.
WASHINGTON — The Obama administration will call for increased oversight of executive pay at all banks, Wall Street firms and possibly other companies as part of a sweeping plan to overhaul financial regulation, government officials said.
The outlines of the plan are expected to be unveiled this week in preparation for President Obama’s first foreign summit meeting in early April.
Increasing oversight of executive pay has been under consideration for some time, but the decision was made in recent days as public fury over bonuses has spilled into the regulatory effort.
The officials said that the administration was still debating the details of its plan, including how broadly it should be applied and how far it could range beyond simple reporting requirements. Depending on the outcome of the discussions, the administration could seek to put the changes into effect through regulations rather than through legislation.
One proposal could impose greater requirements on the boards of companies to tie executive compensation more closely to corporate performance and to take other steps to assure that outsize bonuses are not paid before meeting financial goals.
The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving federal bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission. Last month, as part of the stimulus package, Congress barred top executives at large banks getting rescue money from receiving bonuses exceeding one-third of their annual pay.
Chip Reid hammered Robert "Peter Griffin" Gibbs today. Peter fumbles like I've never seen him fumble before! How does Obama keep sending this guy out there everyday?
How does Gibbs keep sending himself out there everyday?
I'm glad that Chip (CBS), Jake Tapper (ABC) and Major Garret (FOX) are asking tough questions.
Maybe the rest of the White House Press Pool will join forces soon!
This is bad! They have absolutely no answers for their AIG lies!
It's a long video, but worth the wait.
The relevant fumblin', bumblin, stumblin' is at the 15:28 mark.
Q So he's not really feeling frustrated that this week the message kept slipping away and getting only chatter.
MR. GIBBS: I didn't go to California, but it looked like he was having a good time.
Q On Geithner, is the administration sticking to -- are you sticking to this March 10th date for when he found out about this? Because I -- he was asked about it in Congress a week before -
Q It was March 9th.
Q March 9th. He was asked a week before, specifically.
MR. GIBBS: And I think the Treasury Department addressed that in the newspaper this morning. Look, I think there's -- there has been -- obviously, the Treasury has talked about taking responsibility for knowing more about the timeline.
Q When Secretary Geithner talked about that yesterday, he really parsed words. He said, on Tuesday, March 10th, I was informed about the full scale and scope of these specific bonuses. He's not saying that was the first time he learned about it --
MR. GIBBS: Well --
Q A very careful parsing of words here, suggesting he did know about it before then.
MR. GIBBS: No, I -- I think if you read carefully the report you're discussing, the Treasury Secretary takes responsibility, as the President does --
Q But he's sticking by that October 10th date -- excuse me, March 10th date --
MR. GIBBS: Right, I --
Q -- even though he clearly knew about it before then. He was asked about it in Congress --
MR. GIBBS: But, again -- but again, Chip --
Q -- and he was overseeing the AIG bailout. I mean, is it --
MR. GIBBS: What committee --
Q It just doesn't seem credible.
MR. GIBBS: That was Ways and Means?
Q Yes. But he was specifically asked the question.
MR. GIBBS: No, I understand. I understand. And I think he's addressed that and I think that's addressed in both the reports today and what he said yesterday. Chip, we're -- we understand and the President shares the outrage and the frustration that everybody has. The administration is taking steps to recoup money that's gone out, as well as to put in place a financial stability plan and to seek progress on getting our economy moving again.
Q Let me just ask you specifically. When he says, on March 10th he was informed about the full scale and scope, is he saying that's the first he learned about it at all?
MR. GIBBS: Chip, the question is predicated on the report in the paper and I think the report in the paper answers your question.
Q So he did know about it before then? 20:54
MR. GIBBS: Chip, I will -- can somebody go get a dollar and buy Chip a newspaper so that he can read the report? Again, I think it's pretty clear --
Q Been read.
MR. GIBBS: Excellent. Then I believe it's been answered.
Q Robert, can I follow on that real quick? Why did you tell us that it was March 10th, then, that you found out? The statement from the White House was very specific, he found out March 10th.
MR. GIBBS: Again, I would point you to the report that the Secretary of the Treasury takes responsibility, as does the administration, with knowledge about the structure and the scope of those bonuses.
Q But we were accidentally or however misinformed about the day that he found out.
MR. GIBBS: Well, let's -- let's not -- I'm just going to leave it at that. I think the report is pretty clear and so are the answers.
Rep. Waters appeared on The Joe Scarborough Show this morning to discuss the AIG Bonus scandal.
"They've got some explaining to do. I think the President is going to have to clarify to the American public what took place between the Treasury and Mr. Dodd. There appears to have been some kind of agreement that they would protect AIG from having to give those bonuses." she said.
"I don't know who said what and when. Chris Dodd said he wrote the language but that he was pressured practically by Treasury. Maybe the President is not up to speed on what's going on but I think it is going to have to be clarified."
The best part is when Mika simply says, "Wow". (She is an slobbering Obama Maniac, by the way.)
Wait a minute, I thought they didn't know about these bonuses until March 5th?
So, he lied? The tax cheat lied? No way!?
The bonus contracts were written in March of last year and included a provision that required most bonuses to amount to 100 percent of their 2007 bonuses.
Are we to believe that this was not known when Tim Geithner brokered the AIG bailout last fall?
Treasury Secretary Timothy Geithner acknowledged Thursday that his department asked Sen. Chris Dodd (D-Conn.) to insert language in a stimulus bill that would ensure AIG workers would get their bonuses.
Already under fire for his handling of the issue, Geithner said Treasury officials spoke with Dodd about a provision to the economic stimulus bill that would protect the AIG bonuses, because government officials were concerned about lawsuits from AIG employees.
“But we also worked with him to strengthen the overall framework,” Geithner said. “And his bill has this very important provision we’re relying on now to go back and see if we can recoup payments that were made that there was no legal ability to block.”
Dodd said this week that he inserted the bonus provision after a Treasury official asked for it. He refused to name who at Treasury made the request – and Geithner also refused to name names, but indicated that it was not him personally.
“I did have with other officials some conversations with Chairman Dodd as he was going through this process, but other provisions,” Geithner told CNN’s Ali Velshi.
Really? So Dodd lied. Geithner lied. But Obama is innocent?
The Constitution says the government can’t interfere in private contracts–and the AIG bonus agreements were struck in early 2008, when the company wasn’t under government control
The Fourth Amendment guards against searches, arrests, and seizures of property without a specific warrant or a "probable cause" to believe a crime has been committed. Some rights to privacy have been inferred from this amendment and others by the Supreme Court.
Where is the crime? No penalties were written into the original TARP bailout.
This act also violates the Equal Protection Clause of the 14th Amendment! You cannot just tax one individual more than another because you don't like it!
Acting swiftly, the Democratic-led House approved a bill Thursday to slap punishing taxes on big employee bonuses at firms bailed out by taxpayers. In some cases the bonuses might be taxed 100 percent leaving the recipients with nothing.
The bill would impose a 90 percent tax on bonuses given to employees with family incomes above $250,000 at American International Group and other companies that have received at least $5 billion in government bailout money.
"We want our money back now for the taxpayers," House Speaker Nancy Pelosi said.
Rep. Charles Rangel, a New York Democrat, chairman of the tax writing House Ways and Means Committee, said he expected local and state governments to take the remaining 10 percent of the bonuses, nullifying the payouts.
The vote to tax back most of the bonuses was 328-93. Voting "yes" were 243 Democrats and 85 Republicans. It was opposed by six Democrats and 87 Republicans.
Minority Leader John Boehner, an Ohio Republican, said the bill was "a political circus" to divert attention from why the administration and congressional Democrats had not done more to block the bonuses.
Diversion indeed and a complete violation of liberty. Has Congress failed to read The Constitution like it failed to read the stimulus bill?
Thank you Rep. Darrell Issa (R-CA) for holding out President accountable!
Rep. Issa has written a letter to President Obama demanding what he knew and when he knew it about AIG.
Like me, Issa thinks Obama is not telling the truth.
Earlier today, he discussed it with Neil Cavuto.
The text of the letter to the President
March 17, 2009
The President
The White House Washington, DC 20500
Dear Mr. President:
The American people are rightly outraged over the news that AIG is paying $165 million in bonuses to its executives. This news is especially troubling given that AIG received another $30 billion in bailouts just two weeks ago. The egregious actions of AIG underscore the fact that even more taxpayer dollars are vulnerable to waste and abuse due to the unprecedented spending levels brought about by the Troubled Asset Relief Program and economic stimulus legislation.
Given your recent expressions of outrage about bonuses being paid to AIG executives, I am concerned that members of your Administration may not be bringing critical information to your attention in a timely manner.
There is good reason to believe that White House officials have long known about impending bonus payments to AIG executives, even prior to the decision two weeks ago to approve a $30 billion bailout payment to AIG.
Two weeks ago, White House Press Secretary Robert Gibbs expressed confidence that White House officials were fully aware of how AIG was using taxpayer funds.
Recent news reports have also suggested that officials in your Administration may have more knowledge about the AIG bonus payments than has previously been disclosed. CBS News reports that an official in your Administration said that the AIG bonuses have long been known about inside and outside AIG.
I would appreciate if you would assist me in understanding the extent of the Administrations knowledge of the bonuses being paid to AIG executives, including the earliest date at which senior Administration or White House officials became aware of the pending bonus payments to AIG employees and when this was first brought to your attention. I would appreciate it if you would respond no later than March 24, 2009.
I demand that someone be fired over the AIG bonus "scandal"!
And it's not anyone who works for the company.
Tim Geithner needs to go!
Team "O" wants us to believe that they did not know about the AIG bonuses until two weeks ago, March 5th.
This is all a big fat fu*king lie! Who are they trying to kid? Seriously!
This is preposterous that President Obama is blasting AIG and his "outrage" is creating chaos!
Chris Dodd knew about it when he secretly placed an amendment into the CRAPUulus Socialism Bill over a month ago? Did no one bother to read it?
Oh wait, they didn't! President Obama signed the bill! Are you telling me that neither he nor anyone on his staff read the bill?
Our President is either a bold-face liar or an incompetent fool! We have a President who is not understanding what he is signing? How dangerous is that!
The bonus contracts were written in March of last year and included a provision that required most bonuses to amount to 100 percent of their 2007 bonuses.
Are we to believe that this was not known when Tim Geithner brokered the AIG bailout last fall?
I don't care if Geithner is under-staffed or not! If you can't stand the heat, get out! This is bullsh*t and I'm sick of the incompetance of this administratio so far.
Sources in the Obama administration Tuesday said that despite previous media reports administration officials did not know until a couple weeks ago that the officials of the controversial AIG Financial Product Division were set to receive $165 million in bonuses on March 13.It wasn't until Monday, March 5, 2009, administration sources told ABC News, that officials of the Federal Reserve Bank of New York informed officials of the Treasury Department of the full extent of the $165 million in bonuses pending for the controversial Financial Products Subsidiary.
This was three days after the Obama administration had already announced a new commitment of an additional $30 billion for AIG.Treasury Secretary Tim Geithner was alerted last Tuesday, March 10; he phoned AIG CEO Edward Liddy on Wednesday evening, March 11, to protest the bonuses, sources told ABC News.
On Thursday, March 12, Secretary Geithner informed a senior White House official about the controversy, aides passed the information on to President Obama later in the day.
How the Obama administration was caught flat-footed by this controversy dates back to last Fall, when the New York Federal Reserve Bank -- then run by Geithner -- stepped in to give AIG a high-interest loan for $85 billion to help prevent the company from going under -- which Lehman Brothers was doing at the time. As part of the deal, AIG CEO Hank Greenberg was replaced by the new CEO, Liddy.In late October, the $700 billion Troubled Assets Relief Program passed Congress, which includes rules about executive compensation but nothing about retention bonuses.
In November, the Fed and Treasury Department soon began pumping more money into AIG -- $40 billion, to take down the $85 billion credit facility set up by the Federal Reserve Bank of New York.
At this point, an Obama administration official says, Treasury officials generally became aware that AIG had put retention programs in place, but whom they were for and the extent of them were unknown. The New York Fed began studying the compensation policies on the books -- while also making efforts to save banks and rescue the economy. But by then Geithner's nomination was pending and he had recused himself from dealings with AIG.
I can't waste my time on AIG anymore; it's causing my blood to boil.
A final note, the outrage is not that AIG used a small fraction of bailout money to pay bonuses.
The outrage is our incompetent Liar-in-Chief! I'm not kidding. He is either a liar or stupid.
Obama is radical, arrogant, dishonest and dangerous.
The rhetoric grew so heated yesterday that Sen. Charles E. Grassley (R-Iowa) suggested in a radio interview that AIG executives ought to "follow the Japanese model . . . resign, or go commit suicide." An aide later explained he does not actually want executives to kill themselves.
"One way or another, we're going to try to figure out how to get these resources back," said Christopher Dodd, D-Conn., Senate Banking Committee chairman, last night.
You allowed them get those bonuses you idiot! (see below)
This is outrageous! These people are all hypocrites!
Politicians like Dodd, WepwethentativeBawney Fwank and even President Obama are using the AIG bonus "scandal" as fuel to stir anger into the hearts and minds of angry peasants armed with pitchforks ready to storm AIG offices!
AIG released information on these retention bonuses last year! Everyone knew they were coming and Dodd even put an amendment into the CRAPulus Bill to protect these bonuses!
Let's not forget that Treasury Secretary Tim Geithner was the architect of the AIG bailout plan!
Let's also not forget that Dodd received more campaign donations from AIG than any other politician! (Obama was second, McCain third) Not to mention, AIG headquarters happens to be in Dodd's home state!
This is nothing more than political grandstanding, using another "crisis" as a diversion from Obama's waning popularity! It's amateurish and outrageous!
Senator Chris Dodd (D-Conn.) on Monday night floated the idea of taxing American International Group bonus recipients so the government could recoup some or all of the $450 million the company is paying to employees in its financial products unit. Within hours, the idea spread to both houses of Congress, with lawmakers proposing an AIG bonus tax.
The move represents somewhat of an about-face for the Senator. While the Senate was constructing the $787 billion stimulus last month, Dodd added an executive-compensation restriction to the bill. That amendment provides an “exception for contractually obligated bonuses agreed on before Feb. 11, 2009” -- which exempts the very AIG bonuses Dodd and others are now seeking to tax.
The amendment made it into the final version of the bill, and is law. Separately, Sen. Dodd was AIG’s largest single recipient of campaign donations during the 2008 election cycle with $103,100, according to opensecrets.org. Dodd’s office did not immediately return a request for comment.
One of AIG Financial Products’ largest offices is based in Connecticut.
Dodd Amendment Rules
Crack down on bonuses, retention awards and incentive compensation: Bonuses can only be paid in the form of long-term restricted stock, equal to no greater than 1/3 of total annual compensation, and will vest only when taxpayer funds are repaid. There is an exception for contractually obligated bonuses agreed on before Feb. 11, 2009.
For institutions that received assistance totaling less than $25 million, the bonus restriction applies to the highest compensated employee; $25 million to $250 million, applies to the top five employees; $250 million to $500 million, applies to the senior executive officers and the next top 10 employees; and more than $500 million applies to the senior executive officers and the next top 20 employees (or such higher number as the Secretary determines is in the public interest).
Too big to fail, they say? How about too big! Had the government stayed out of the way, AIG could have filed for bankruptcy protection and a judge could have ruled that these bonuses not be paid.
But, no. Washington wants to have its cake and eat it too, which is why they keep giving AIG cash and then using the problem for political expediency when it suits their needs. Why else would the Fed have to be sued for information regarding how AIG spends the TARP money!
This is all a load of crap and I'm tired of talking about it; it's another Alinsky-esque diversion orchestrated from the White House and Rahm The Ballerina!
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