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Wednesday, March 18, 2009

Obama Guaranteed AIG Bonuses, Then Pretended 'Outrage'

Remember this?

President Obama said he was 'choked up with anger'

US President Barack Obama has expressed anger at $165m (£116m) bonuses pledged to executives of bailed-out insurer AIG, calling the payments "an outrage".

"It's hard to understand how derivative traders at AIG warranted any bonuses, much less $165m in extra pay," he said.

He has told Treasury Secretary Timothy Geithner to "pursue every single legal avenue" to block the bonuses.

Barack Obama "shares our outrage? Yet he signed the stimulus bill which we now find out, guaranteed those very bonuses were protected.

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.”

This amendment provides an exception for contractually obligated bonuses agreed on before Feb. 11, 2009, which exempts the very AIG bonuses Obama is condemning every single chance he gets. The amendment is in the final version and is law.

That little was put into the bill by Chris Dodd and the stimulus was bill was signed into law by Barack Obama after passing the House with no Republican support and passing the Senate, barely able to bypass a Republican filibuster, after Reid took it off the table a couple times to guarantee he could get 60 votes.

The link above also shows other news stories, showing the Obama administration knew about the $165 billion in bonuses before they bailed out AIG, yet again.

For months, the Obama administration and members of Congress have known that insurance giant AIG was getting ready to pay huge bonuses while living off government bailouts. It wasn’t until the money was flowing and news was trickling out to the public that official Washington rose up in anger and vowed to yank the money back.

Obama only became "outraged" and shared our "outrage" after the public became aware of the bonuses.

You think only bloggers and the right are pointing out how the stimulus bill Obama signed guaranteed those bonuses?

Think again.

From CNN "Bonuses allowed by stimulus bill"

Multiple Senate Democratic leadership sources also deny knowing how the exemption got into the bill.

The mystery isn't just how what was effectively a protection for AIG was put into the stimulus bill -- it's also how a provision intended to prevent AIG from giving executive bonuses, was taken out.

The Senate passed a bipartisan amendment proposed by Sen. Olympia Snowe, R- Maine, and Sen. Ron Wyden, D-Oregon, that would have taxed bonuses on any company getting federal bailout dollars, if the company didn't pay back the bonus money to the government.

But the idea was stripped from the stimulus bill during hurried, closed-door negotiations with the White House and House of Representatives.

Senate Finance Committee Chairman Max Baucus, D-Montana, who is now pursing a similar bonus tax idea in the wake of outrage over AIG, said it was a mistake to drop it from the stimulus bill....

Dodd of course is trying to deny the amendment, with his name attached, was written in the language that ended up being signed into law by Barack Obama.

Obama signed it with the amendment that guaranteed those bonuses ad now claims "outrage?"

A little reminder of how "outraged" Obama is, AFTER signing the stimulus bill assuring those very bonuses.

Obama's complete statement, via The Caucus:

I want to comment on the news about executive bonuses at A.I.G. This is a corporation that finds itself in financial distress due to recklessness and greed.

Under these circumstances, it’s hard to understand how derivative traders at A.I.G. warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?

In the last six months, A.I.G. has received substantial sums from the U.S. Treasury. I’ve asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole.

I know he’s working to resolve this matter with the new C.E.O., Edward Liddy, who came on board after the contracts that led to these bonuses were agreed to last year.

This isn’t just a matter of dollars and cents. It’s about our fundamental values.

All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multi-million dollar bonuses. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules.

That is an ethic we must demand.

What this situation also underscores is the need for overall financial regulatory reform, so we don’t find ourselves in this position again, and for some form of resolution mechanism in dealing with troubled financial institutions, so we have greater authority to protect the American taxpayer and our financial system in cases such as this. We will work with Congress to that end.

Not only did Barack Obama, House Democrats and the Senate, guarantee those AIG bonuses, but Obama himself gave AIG another $30 billion bailout so they had the money to PAY those bonuses.

I am sure he is outraged, not at AIG, not about the bonuses, but that he was caught red handed and speaking out of both sides of his mouth.

One of the links above also gives us a little more information... just some trivia, in case all this doesn't anger you enough.

Update: American International Group (AIG) Contributed to the Following Members of the Senate


Name / Office / Total Contributions

Dodd, Chris (D-CT) Senate $103,100
Obama, Barack (D-IL)Senate $101,332
Clinton, Hillary (D-NY) Senate $35,965
Baucus, Max (D-MT) Senate $24,750
Biden, Joseph R Jr (D-DE) Senate $19,975