Thursday, March 19, 2009

Dodd's AIG problem

This morning the news media is ablaze with reports that are similarly titled to the Courant's "Dodd Admits Role In AIG Bonus Controversy", which give the impression that Sen. Chris Dodd actively pushed for the outrageous bonuses that are proposed for AIG execs. The story below illustrates that Dodd is doing a terrible job debunking the story.

The fact is, the MSM has been looking for someone to pin this debacle upon, and it now has conveniently focused on Sen. Dodd, who chairs the Senate Banking Committee. Dodd now has a huge problem as he becomes the principal fall guy for the snowballing nationwide outrage.

When asked by the Connecticut Post, Gary Rose, a Sacred Heart University professor of political science, said this could open the door for someone to challenge Dodd's hold on his Senate seat.
"It continues to raise the spectre of preferential treatment and it may not be true, but the perception, in politics, is reality," Rose said. (emphasis mine)
People should keep in mind that while the bonuses ARE abominable, they account for merely one-tenth of one percent of the TOTAL bailout for AIG. I can only hope that the MSM works as diligently to oversee that the OTHER 99.9% of the money is being spent wisely.

(This post below is by CaptCT cross-posted from My Left Nutmeg this morning)

Hey folks, it was Chris Dodd who wrote the provision in the bailout bill to DENY AIG Executives their bonuses.

Let me repeat that. Chris Dodd wrote the provision to DENY AIG Executives their bonuses.

The Obama Admnistration's Treasury Department then demanded that Dodd change the language, and Dodd reluctantly modified the language. Then yesterday, some lowlife in the Treasury Department blamed Dodd for writing the watered-down restrictions.

The facts surrounding this story -- not the ones CNN and the NY Times have been reporting -- have been covered by Jane Hamsher at FDL, by Glenn Greenwald at Salon, and by Arianna Huffington.

All of them document in detail how Dodd fought to restrict bonuses for AIG executives, and how the Obama administration fought to water down or eliminate those restrictions. As Greenwald makes clear ...
It was Dodd who did everything possible -- including writing and advocating for an amendment -- which would have applied the limitations on executive compensation to all bailout-receiving firms, including AIG, and applied it to all future bonus payments without regard to when those payments were promised. But it was Tim Geithner and Larry Summers who openly criticized Dodd's proposal at the time and insisted that those limitations should apply only to future compensation contracts, not ones that already existed. The exemption for already existing compensation agreements -- the exact provision that is now protecting the AIG bonus payments -- was inserted at the White House's insistence and over Dodd's objections. [...]

The point was -- and is -- that Dodd was pressured to put that carve-out in at the insistence of Treasury officials (whose opposition meant that Dodd's choices were the limited compensation restriction favored by Geithner/Summers or no limits at all), and Dodd did so only after arguing in public against it. To blame Dodd for provisions that the White House demanded is dishonest in the extreme...
This is a reminder that Dodd has a huge bullseye on his back -- from Republicans and banking interests. And as Dodd looks at how the financial industry and health care industries need to be reformed, he is going to be attacked relentlessly by friends of the banking and insurance industries. Get used to it. If you thought the "Dean scream" hysteria and the "Gore invented the internet" smears were ridiculous, well, this is going to be just like that.

11 comments:

Nopartisan said...

Wait... Dodd says he was pressured Before leaping to his defense at this point, perhaps we should wait to see what the true story is. The only undisputed fact is that as head of the banking commitee he received over $100,000 in donations from aig when he ran for president. The facts are confusing to say the least. Dodd at first said he didn't know how the exemption got in there (interview CNN tuesday). Then wednesday he tells CNN that he did dilute the original bill at the behest of treasury, then tells Chris Matthews (wednesdays Hardball) he doesn't know the names of the two treasury officials who applied the pressure! So he expects us to believe that he watered down the compensation language based on pressure from two unknown officials? Cmon Bob all the bloggers defenses of Dodd are rather pointless when in 2 days from his own mouth on television he comes across as being not very credible. As to the 1% of the bailout being what is debated, the issue is did he help executives at a company that gave him over $100,000 in donations. We have a right to the truth and changing stories only give more reason for doubt as to his integrity.

CT Bob said...

No, I agree completely that Dodd handled this thing poorly. I'm NOT making excuses for him here.

He apparently didn't want to anger the Obama administration by calling out Geithner/Summers publicly for their insistence on scaling the bonus limits way back. By being so evasive about it, he came off looking stupid at best, and guilty at worst.

But if the MSM was doing their job, they'd be asking WHY those guys are so insistent about bonuses.

ricky said...

i don't see how anybody can defend dodd in any manner. his credibility is gone. to be one of the lead attack dogs when the aig bonus story broke, to denying any involvement with the bill's exemption, to then admitting he was the author proves that he can not be trusted. regardless of how or why he wrote the exemption, the man lied to the people who elected him.

CT Bob said...

I'm not defending him, I'm just pointing out how the MSM is covering this situation. His credibility is absolutely suffering right now, and the MSM seems to be using him as the "face" of AIG's excesses.

I think the odds of him recovering from this are getting longer. If the economy doesn't experience a substantive bounce by the end of this year, he might do better to retire in 2010 and let someone else like Murphy or Lamont take a crack at his seat.

rickyk said...

i guess what i am struggling is why you aren't calling for his resignation or impeachment, rather then suggest that he needs an economic bounce to stay.

it is simple... he lied. a huge lie. and he is caught. those are facts supported by his own words, nothing to do with the MSM.

i don't pay attention to the MSM anyway, and you shouldn't either.

West Haven Bob said...

Seems to me that CT Bob is getting more heat for this crap than anyone else.....

Nopartisan said...

It isn't a reflection on Bob, but rather the fact that while I agree that the msm throws crap out there without verification, the bloggers he listed are all to ready to exonerate Dodd based on what HE says rather than follow the trail of contradictions from his own mouth. It does smell somewhat like a circling of wagons based on the fact that some polls show Dodd trailing a rather weak republican candidate.

CT Bob said...

Well, today it came out that Geithner DID ask for the removal of the bonus limitation. This will change things significantly as far as the media frenzy, I think. Now they'll probably focus on Treasury and the administration.

CT Bob said...

And I don't mind a little heat, WH Bob; I think it's good to debate these issues here.

ricky said...

let there be no doubt... whoever it was in treasury that requested the change, and who ever it was who implemented the change are all equally accountable. if obama approved/requested it, he is accountable as well.

but the fact still remains that dodd has been caught in a huge lie, and should be held accountable for intentionally deceiving us, regardless of the topic.

vancouver realtor said...

Excuse me, but has anyone actually looked at what these bonuses are for? They are partly normal salary for last year, that has been withheld and now is paid out with some bonus on the top. Is it really fair to tax it 90%?

I'm not supporting the idea of paying millions to those who didn't earn them by working real hard, but taxing salary in this fashion I find rather odd.

Take care,
Jay