OBAMA'S BACK-DOOR AIG BONUSES
Caught in A Big Fat Lie
That Obama Officials Sought
To Keep AIG Bonuses, Not Prevent Them
Main Street Public Outrage is Red-Hot.
Fraud and Corruption Rule Washington and Wall Street.
Here's what we know so far.
Money is The Mother's Milk of
Democrat and Republican.
Wall Street Banks Gave
Obama $3 million in 2008.
What A Good Investmennt They Made
Goldman Sachs Is The Real Beneficiary.
Secretary Geithner approved in advance the payment
million in "bonuses" to 73 AIG employees. This should
be surprising, in itself. Geithner as NY Fed Chariman played
role in preventing AIG from going bankrupt and getting them
initial bailout of $75 billion.. Geithner seems to be a perfect
bureaucratic pawn for his Wall Street masters. He certainly had
appreciation for the political storm AIG bonuses would cause.
Obama's case is different. He is a politician. He knew there
be an uproar about these bonuses. So, he had to feign outrage.
the truth is now coming out. Obama not only knew in
advance of these payments, he expedited them. Significantly,
did not express outrage until the public found out. Now he
skirts the fact that he knew in advance. He takes formal responsibility:
"The buck stops here". But he avoids admitting his role. How he
to fool us with his feigned anger! But now we learn the truth.
Obama actually learned of the bonuses weeks ago, not a few days
as he claimed. Even more important, the White House and
Senator Chris Dodd combined forces and took steps secretly,
covertly, when the public was not looking, to make the bonuses
harder to prevent. He did this more than a month ago.
Chris Dodd, who himself has received big campaign
from AIG in the past, like Obama, at first lied about
fore-knowledge and involvement in allowing the bonuses.
days ago, CNN reported that Dodd insisted that he was not
involved in any way in striking out from last month's Stimulus
Legislation's an explicit prohibition on the Treasury's allowing
bonuses for executives at companies receiving bailouts
Dodd's Lie Yesterday - : "Let me be clear: I was completely unaware
of these AIG bonuses until I learned of them last week."
Today - Dodd admited live on-air, to Wolf
Blitzer and a
CNN reporter, that he was responsible for the bonus loophole,
and was originally covering up for un-named individuals
in the Obama administration.
Dodd, when he was cornered today and knew the truth would
emerge from all the public attention, apologized and admitted
he had been told by the White House to purge the prohibition
on such bonuses in the Stimulus legislation.
Dodd should resign! The Democrats will try to cover this up.
But I hope the media continues to reveal the extent to which
Wall Street manipulates key Congressmen, the White House
and the Federal Reserve. Don't hold your breath for CBS to
talk about this. CBS Covers AIG
Bonuses, No Mention of Chris Dodd Amendment ...
The $165 million, in question, came directly from the taxpayers
bailout. Intensely galling, these bonuses were paid pnly to
people working in AIG's Financial Products subsidiary of AIG.
is precisely the part of the company that brought the
of AIG and caused the taxpayers to have to provide
Lawrence Summers, Obama's top economic adviser defended
"The easy thing would be to just
say ... off with their heads, violate the
contracts. But you have to think about the consequences of breaking contracts
for the overall system of law, for the overall financial system."
Republicans were quick to see the opening: Senate
Republican leader Mitch McConnell of Kentucky exploded:
"For them to simply sit there and blame it on the previous administration or claim
contract we all know that
contracts are valid in this country, but they need to be looked at...Did they
enter into these contracts knowing
full well that, as a practical matter, the taxpayers of the United States
were going to be reimbursing their
employees? Particularly employees who got them into this mess
in the first place? I think it's an
The bonuses averaged more than $2 million to each
recipent. The biggest bonus was $6.4 million. The
received $4 million each. 22 individuals
of more than $2 million each. These
"retention" bonuses. They were not for superior
performance! 11 of the individuals who received
retention bonuses worth more than $1 million or more
are no longer working for
AIG's CEO, Edward Liddy in front of Congress , insisted
that he was obliged by contact to make these payments.
(The contracts themselves have not been made public.)
My experience is that there is always a loophole. Lawyers
can almost always find a way to break an outrageous contract.
No effort was even made to renegotiate the contracts. Liddy also
refused to provide the names of those getting the
money, except under condition of non-disclosure,
Rep. Barney Frank refused. Liddy claimed that the lives
of those receiving bonuses would be in danger, so hostile
was the public.
NY Attorney General Cuomo argues that AIG could have
negotiated with these employees. Threatened with losing their
job, they might well have accepted changes. But Obama's
Administration did not want AIG to even try, so concerned
are they at keeping Wall Street happy.
Liddy claimed that these
bonuses individuals are vital to
"winding-down" AIG's unprofitable
business in a volatile
market. He said if they were not paid their million dollar
bonuses, they would quit and go elsewhere to work. Where,
in this market? Many people would say "Good riddance".
There are thousands who would work very hard for a fraction
of what AIG was paying!
Comparable pay at other firms
is no more than $150,000/year.
AIG's outrageous bonuses are part
of a larger problem.
Wall Street still thinks it is entitled to make huge fortunes
on the back of Main Street and taxpayers. It is an affront
of the worst kind that taxpayer bailout money is being used
to pay these obscene bonuses.
Wall Street's sense of entitlement would disappear quickly if
many powerful American politicians from Obama to Chris
Dodd did not protect their Wall Street campaign contributors.
There are genuine populist heros out there. NY Attorney
General seems to be one. He continues his effort to get
Bank of America, itself a receiver of $45 billion of taxpayer
money, to reveal the names and compensation information
of those at Merrill Lynch who received bonuses shortly
before the firm merged with Bank of
America. Cuomo has accused
Bank of America of "undermining his authority, interfering with
his investigation and attempting to
influence the government's
( http://abcnews.go.com/Blotter/WallStreet/Story?id=7102959&page=2 )
I only hope that Cuomo investigates AIG
contributions to Dodd and Obama. As it is, Obama's payback
to AIG is now making much needed stimulus of Main Street
that much more difficult politically.
Contributions from AIG
Obama refused to comment about AIG
he received. Dodd is saying now that he will give his back.
In 2008 AIG
gave Dodd and Obama each more money
than $100,000, by far the most it gave to any other politican.
Democrats were the primary recipients. Of the $587,000 the
company doled out to campaigning lawmakers,
nearly $443,000 -- or three-quarters -- went to Democrats.
McCain, John (R-AZ)
Clinton, Hillary (D-NY)
Baucus, Max (D-MT)
Biden, Joseph R Jr (D-DE)
Romney, Mitt (R)
Sununu, John E (R-NH)
Dodd: 'I'm Giving Back AIG Cash'
- 9 hours ago
Will Obama, McCain, Dodd
Return Contributions From AIG ...
Thieves in The Night
Obama, Dodd and others talk a good game of limiting
executive pay for companies getting taxpayer bailout,
but the evidence is clear. They lie and mislead about
their imvovmenty in making these payments possible.
As said earlier, initially the Stimulus law passed last month
would have prevented such bonus payments. But in the
dark of the night, they took out the key provision that would
have banned such bonuses. They did this as quietly
as possible. They were not proud of what they were doing.
They knew it was wrong. They wanted to keep it from the
"Senators Ron Wyden and Olympia Snowe proposed an amendment to the
stimulus package that would have barred bailout-fund recipients from paying huge
executive bonuses (and taken back the ones paid last year.) From the AP, back then:
The $838 billion measure includes an amendment penalizing companies that paid
bonuses greater than $100,000 to executives after receiving government rescue
funds last year. The amendment would require the companies to repay within four
months any portion of the bonus above $100,000 or face an excise tax of 35 percent
on the portion of the bonus above $100,000. The Wyden-Snowe amendment passed
the U.S. Senate. So, what happened? From
the AP, today: In February, the Senate
voted to add such a proposal to the economic recovery bill that cleared Congress,
but in final closed-door talks on the measure, that provision was dropped in favor
of limits that affect only future payments.
"There was a lot of lobbying against it and it died,"
said Sen. Ron Wyden, D-Ore.,
who proposed the measure with Republican Sen. Olympia J. Snowe of Maine.
Obama is not to be trusted.
He talks a good game
of reigning in obscene
pay for failure.
But he refuses to demand this money be
repaid the taxpayer and
when the truth comes out,
it is likely that we
will discover that his Administration
has played a key
role in letting these bonuses stand.
Oregon Senator Wyden said "Obama's team is sending
mixed messages on what
will and won't be tolerated on bonuses, with the president coming out strongly
against excessive Wall Street rewards but top officials not following through. The
president goes out and says this is not acceptable, and then some backroom deal
gets cut to let these things get paid out anyway."
Senators Wyden and Snowe plan to quickly introduce
as free-standing legislation. Obama
has not said he will support it.
His press conference today showed him avoiding standing with
those who aredemanding that the bonus money be taken back
taxed away. Perhaps he was talking about himself when he said today:
"There are a whole bunch of
folks now who are feigning outrage about these bonuses..."
Goldman Sachs Was Obama's Biggest
Corporate PAC Campaign Contributor
|University of California
|JPMorgan Chase & Co
|Sidley Austin LLP
|National Amusements Inc
|Skadden, Arps et al
||Obamas Chief of Staff Pick Took Campaign
Contributions from Wall Street Friday,
November 07, 2008 By Fred Lucas,
"The Center for Responsive Politics has issued a report
highlighting millions of dollars in campaign contributions that Rep. Rahm Emanuel (D-Ill.)
has raised from individuals working in the hedge fund industry, private equity firms, and
large investment firms.
"Emanuel has raised more money from individuals and political action committees in
securities and investment businesses than from any other industry.
"This comes after a presidential campaign that saw Obama frequently criticize Wall
Street and blamed lack of government regulations for the economic crisis that hit the
country in mid-September.
"Emanuel, a former Clinton White House aide, is chairman of the Democratic
Congressional Campaign Committee and received much of the credit for the Democrats winning
a majority in the House of Representatives in 2006 the first time in 12 years.
"For his own 2006 re-election campaign, where he faced no serious opposition, Emanuel
raised $1.5 million from the investment industry. His other sources of contributions came
from lawyers, who gave $682,900, while people working in the entertainment industries gave
$376,100. Though Obama did not accept contributions directly from
lobbyists during his campaign, Washington lobbyists have given Emanuel $136,640 since he
Elliot Spitzer is not silent ...
Goldman Sachs Is The Real Beneficiary
"Eliot Spitzer must miss his glory days when he was the scourge of Wall Street as New
attorney general (and not that upstart Andrew M. Cuomo). With the bonus battle exploding
at the American International Group, Mr. Spitzer has jumped into the fray
the bonus scandal, arguing that it is obscuring the real disgrace at A.I.G.
"Why are A.I.G.s
counterparties getting paid back in full, to the tune of tens of billions of taxpayer
he asks in an article on Slate. Mr. Spitzer notes that A.I.G.s trading
parties were all the big banks
including Goldman Sachs, many of which received billions of dollars from
Troubled Asset Relief Program. So now we know for sure what we already surmised: The
bailout has been a way to hide an enormous second round of cash to the same group that had
received TARP money already, he writes.
It all appears, once again, to be the same insiders protecting themselves against
pain and risk of their own bad adventure, Mr. Spitzer writes. Recounting how
the economic crisis
is affecting workers, with tax increases, pay cuts and layoffs, Mr. Spitzer asks:
Why cant Wall Street royalty shoulder some of the burden? Why did Goldman have
to get back
100 cents on the dollar? Didnt we already give Goldman a $25 billion capital
infusion, and arent
they sitting on more than $100 billion in cash? In his article on Slate,
Mr. Spitzer says several questions
need to be answered, in public, under oath, to clear the air, including:
What is the deeper relationship
between Goldman and A.I.G.? Mr. Spitzer warns that failure to answer
will feed the populist rage.
See also Obama interviewed by Brokaw at private Goldman
Sachs dinner last ...
Goldman Sachs Reaps $6B After $1M Obama Contribution
Henry Paulson was CEO?of Goldman
Sachs prior to entering
former President George W. Bushs Cabinet as Treasury Secretary. Goldman Sachs has come under
scrutiny for receiving $6 billion in AIG?bailout money. (Roger L. Wollenberg/UPI)
Goldmans Home Run
By Joe Murray, The Bulletin
Tuesday, March 10, 2009
He campaigned on a promise to restore trust in the U.S. government by making it more
transparent, but after a confidential report showing how taxpayer money to American
International Group (AIG) landed in the back pocket of Goldman Sachs was leaked to the
Wall Street Journal, many have questioned Barack Obamas commitment to
With lawmakers now clamoring for names and the Federal Reserve balking at such
disclosures, Capitol Hill is embedded in controversy surrounding the vitality of the AIG
bailout. It started at $83 billion and has since swelled to $173 billion.
Last week, the members of the Senate Banking Committee demanded Fed Vice Chairman
Donald Kohn name the derivative counterparties of the insurer, but he declined to do so,
saying such a disclosure would make it difficult for AIG to operate.
What we need is full transparency in government spending, said Sandra
Frabry, government affairs manager for Americans for Tax Reform. We cant have
transparency after the fact.
Over the weekend, the Journal obtained a confidential memorandum detailing some of the
parties to which AIG directed its bailout money. HSBC, Wachovia, Merrill Lynch, Banco
Santander and Royal Bank of Scotland, Morgan Stanley and other U.S. and European banks
received taxpayer dollars taken from AIGs bailout money.
But it was the $6 billion that landed in the back pockets of Goldman Sachs, a bank with close
ties to Mr. Obama,
which raised a number of ethical questions of how and why taxpayer dollars were covertly
funneled to one of the presidents largest campaign backers.
According to OpenSecrets.com, those at Goldman Sachs were second only to
the University of California in terms of being an Obama top donor. While the
organization itself did not donate the money, such donations were made either through
employees, owners, the immediate families of such members and/or through the
During the 2008 campaign,
those at Goldman Sachs donated $955,473 to
the Obama campaign. Morgan Stanley,
though further down the list, still made the top 20 with a bundled donation of $485,823.
Mr. Obama has also
dipped in the Goldman Sachs pool in making his
presidential appointments. U.S. Treasury Secretary Timothy Geithners loyalty to Goldman Sachs has been an issue of
contention and, upon assuming his post at the Treasury Department, he named Mark
Patterson, a former Goldman
Sachs lobbyist, as a
And as early as last December, reports Mr. Geithner favored Goldman Sachs surfaced when the
New York Times Editorial Board questioned the motivation of then New York Federal Reserve
President Timothy Geithners decision to let Lehman Brothers fail. Then, two days
later, he advocated for the bailout of AIG and its counterparties.
Add to the mix Mr. Geithner arranged a September meeting to discuss the AIG bailout,
and Goldman Sachs CEO Lloyd Blankfein
was the only Wall Street leader at the meeting. At the time, Goldman Sachs was AIGs
largest trading partner, which raises more questions.
During the campaign,
Mr. Obama had strong
connections with Goldman
Sachs, as he was
invited to a private Goldman
Sachs dinner in May
2007 when his candidacy was in its infancy. When it came time to name a vice presidential
running mate, Mr. Obama
turned to Goldman Sachs Board Member James
Johnson. Mr. Johnson was forced to vacate the post under controversy.
While recognizing there was no evidence to support charges of corruption, Ms. Frabry
stressed the Obama
administration would not be able to remove the cloud of corruption without
honoring its commitment to transparency. To date, she believes the administration has
You have to be up front with the American taxpayer on this, Ms. Frabry