The "Blame Dodd for AIG Bonuses" Story is a Disgusting Right-Wing Lie

[Truth2Tell]

This ridiculous meme seems to be gaining some fast momentum on DU. Let's put it to bed now.

From Glenn Greenwald:

There is a major push underway -- engineered by Obama's Treasury officials, enabled by a mindless media, and amplified by the right-wing press -- to blame Chris Dodd for the AIG bonus payments. That would be perfectly fine if it were true. But it's completely false, and the scheme to heap the blame on him for the AIG bonus payments is based on demonstrable falsehoods.

Jane Hamsher has written the definitive post narrating and indisputably documenting what actually took place (See Below). The attempt to blame Dodd is based on a patently false claim that was first fed to The New York Times on Saturday by an "administration official" granted anonymity by Times reporters Edmund Andrew and Peter Baker (in violation, as usual, of the NYT anonymity policy, since all the official was doing was disseminating pro-administration spin). The accusation against Dodd is that there is nothing the Obama administration can do about the AIG bonus payments because Dodd inserted a clause into the stimulus bill which exempted executive compensation agreements entered into before February, 2009 from the compensation limits imposed on firms receiving bailout funds. Thus, this accusation asserts, it was Dodd's amendment which explicitly allowed firms like AIG to make bonus payments that were promised before the stimulus bill was enacted.

That is simply not what happened. What actually happened is the opposite. 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. But now that a political scandal has erupted over these payments, the White House is trying to deflect blame from itself and heap it all on Chris Dodd by claiming that it was Dodd who was responsible for that exemption.

Jane's post documents this sequence of events without any possibility for doubt. The debate that took place over limits on executive compensation for bailout-receiving companies only occurred six weeks ago, and it is all documented in the public press. Dodd was the one fighting against the White House in order to apply the prohibition to all bonus payments, i.e., to make the compensation limits retroactive as well as prospective...

http://www.salon.com/opinion/greenwald/2009/03/17/dodd/index.html

From Jane Hamsher:

Treasury Attempts to “Blame Dodd” for AIG Bonuses
By: Jane Hamsher Tuesday March 17, 2009 1:15 pm 20

As Geithner tries to get out of the way of the AIG bonus train wreck, it looks like the designated sin eater is going to be Chris Dodd:

The administration official said the Treasury Department did its own legal analysis and concluded that those contracts could not be broken. The official noted that even a provision recently pushed through Congress by Senator Christopher J. Dodd, a Connecticut Democrat, had an exemption for such bonus agreements already in place.

So Treasury says Chris Dodd did this? In a word. . . no.

What they're talking about is a clause in the American Recovery and Reinvestment Act, which was signed into law by President Obama on Feburuary 17, and places limits on executive compensation for TARP recipients. According to the white paper obtained by FDL written by AIG to explain its legal justification, the $1.2 billion in bonuses they say they are contractually obligated to pay in 2009 are exempt from these limits:

We have been advised that the bonus provisions of the American Recovery and Reinvestment Act of 2009 prohibiting certain bonuses specifically exclude bonuses paid pursuant to pre-February 11, 2009 employment contracts.

http://firedoglake.com/2009/03/17/treasury-attempts-to-blame-dodd-for-aig-bonuses/

And here's a Feb 14 Wall Street Journal article that backs this all up:

The most stringent pay restriction bars any company receiving funds from paying top earners bonuses equal to more than one-third of their total annual compensation. That could severely crimp pay packages at big banks, where top officials commonly get relatively modest salaries but often huge bonuses.

As word spread Friday about the new and retroactive limit -- inserted by Democratic Sen. Christopher Dodd of Connecticut -- so did consternation on Wall Street and in the Obama administration, which opposed it...

http://online.wsj.com/article/SB123457165806186405.html?mod=testMod

[Uzybone]

1. Dodd is being smeared. But by whom?

http://www.nytimes.com/2009/03/18/business/18bailout.html?hp


"Senator Christopher J. Dodd, Democrat of Connecticut, who initially proposed adding executive compensation and bonus limits to the stimulus bill, did not include the exception.

The clause was apparently added in final negotiations between Congressional leaders and the Obama administration."


"The bill did retain a provision sought by Mr. Dodd that required the Treasury to review all prior bonus payments and to negotiate with bailout recipients for reimbursement of money used for any bonuses deemed inappropriate."


Who added the exception?

[Louis-Emmanuel]

5. According to Greenwald and Jane Hamsher, Geithner added it and Dodd objected

http://firedoglake.com/2009/03/17/treasury-attempts-to-blame-dodd-for-aig-bonuses/

[demo dutch]

9. Geithner Dodd, does it make any difference? it's bad!!!

[Truth2Tell]

15. Yes, it makes a difference.

The folks responsible for this are trying to blame someone who opposed it by lying to the American people. If they can successfully discredit Dodd and other opponents of their Wall Street largess, it will be that much easier to continue with the looting. Yes. It most definitely matters.

[demo dutch]

21. No difference to me, Dodd head of finance committee, Geithner is Obama's guy.. Both are supposed

to fix things.. and they're not

[Truth2Tell]

24. Maybe you are missing the narrative.

Let me try and make it simple for you:

Dodd opposed the AIG bonuses and fought against them. Dodd fights for taxpayers.

Geithner supported the AIG bonuses and fought for them. Geithner fights for the banking industry.

It's pretty tough for Dodd to "fix things" when the Treasury Department and a bi-partisan group of Senators keep breaking them on behalf of the corrupt banks.

[karynnj]

26. Dodd is chair of the Banking Committee, not Finance

On this issue if you read the op, Dodd did everything he could to prevent this. If it was added because of teh WH they need to step up and admit it. Dodd is already polling poorly for his 2010 re-election and the Countrywide mortgage is an issue. This is a concerted attack by the RW on someone they see as maybe unexpectedly vulnerable. The RW story hurts because with the money he got from banks and the mortgage, it paints a bad image.

[wisteria]

55. Thanks for this information. I like Dodd and I hate to see him used like this.

This is upsetting. It appears Dodd may take the fall for the administration.

[ljm2002]

33. Of course it makes a difference!

Geez Louise!

If we are to have any respect for political discourse at all, then yer damn tootin' it makes a difference who the actors are. And yer damn tootin' it makes a difference when you find out that bald faced lies are being spread around in the media, with the obvious wish to CYA on the part of the White House, and trying to throw Senator Dodd under the bus.

I don't follow Dodd that much, so can't comment on him in general. And I don't like it any better than the next person that he, along with all other Congress people, takes money from the big corporations including the ones they supposedly watch over. But when I find out that obvious and blatant lies are being told, yes, I care.

Personally, I'm gettin' a mite peeved at the White House crew...

[riderinthestorm]

36. I wish this were just a CYA move on the part of the WH. I'm not so sure anymore.

There's a lot of information floating around out there that "smells" worse than that. Check out leveymg's thread in GD.

[ljm2002]

37. I'll check it out...

...and you are right, there's a lot going on right now that is hard to sort through and hard to know where the truth is anymore.

[Truth2Tell]

6. Well,

Greenwald says:

...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.

And these are the guys blaming Dodd. Wall Street stooges in the Obama camp. Lay down with dogs...

[Uzybone]

13. lets see how this plays out

but if this is true, I can't defend Tim any more. Summers is already persona non grata IMO.

[Jefferson23]

59. Well that is it in a nutshell. I've been posting this same piece by

Greenwald in any thread about AIG and Dodd. I e-mailed President Obama and Dodd, he is my Senator. This whole story stinks and my concerns about Geithner are many.

[Louis-Emmanuel]

2. It's not only a right-wing lie, as reported by Greenwald

The lie began on Saturday with an "administration official" and Greenwald's title reads "The dishonest "Blame Dodd" scheme from Treasury officials

The right-wing is definitely a participant, but the Treasury is in the mess too.

[Truth2Tell]

10. Fact is,

Summers and Geithner are as right-wing as it gets. This is what happens when we let these neo-"liberal" Wall Street globalist jackasses anywhere near leadership. They have gotten away with calling themselves "progressives" for just about long enough.

[ProSense]

3. Fox, Drudge falsely assert Dodd put "bonus protections" into stimulus bill

Fox, Drudge falsely assert Dodd put "bonus protections" into stimulus bill

Summary: A FoxBusiness.com article reporting on an amendment that Sen. Chris Dodd added to the recovery bill featured the false headline -- subsequently posted by the Drudge Report -- "Amid AIG Furor, Dodd Tries to Undo Bonus Protections He Put In." Additionally, Fox News' Trace Gallagher falsely claimed that Dodd "created a loophole that allowed AIG to give out these bonuses." Rush Limbaugh also falsely asserted that Dodd's amendment provided an "exemption from any limits on" contractual bonuses agreed to before February 11. In fact, Dodd's amendment actually limited bonuses; it did not add "protection" for bonuses or "create a loophole" without which the bonuses could not be paid.

link

[brentspeak]

4. So, according to the New York Times, someone in the White House is smearing Chris Dodd

[Truth2Tell]

7. No,

The Times is helping someone in the Admin smear Dodd.

[brentspeak]

12. After reading Andrew Ross Sorkin's defense of AIG bonuses

I believe you may be right.

[amandabeech]

48. Now, who in the White House would do something like that?

Well, someone has a reputation for nasty politics and a temper to match.

I just hope that he isn't doing this, if it is being done.

[demo dutch]

8. Sorry but did you read the language??? it pretty much lets them off the hook.. here it is

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.

[Truth2Tell]

16. Which part of "DODD OPPOSED THE AMMENDMENT"

do you not get?

[Bolo Boffin]

31. On this, you are correct.

That language wasn't put into the bill until the reconciliation process, after the Senate had passed their version.

[SemiCharmedQuark]

11. K&R

Great find!

[stillcool]

14. Note to self: Read very slowly...

take note of un-named sources. If there are no direct quotes, don't believe it.

[masuki bance]

17. Greenwald quotes the WSJ to smear the Obama administration?

wtf?

[Truth2Tell]

18. Yep that's it.

It's Greenwald doing the smearing and those poor babies at the Treasury are just innocent victims.

At least Matt Drudge agrees with you.

[masuki bance]

19. Do you think Geithner is going rogue?

[SemiCharmedQuark]

20. Apparently he only told Obama about the bonuses Thursday night.

[demo dutch]

22. in bed with the financial world instead of Obama

[girl gone mad]

28. Maybe Obama should have been reading DU.

All of this stuff was covered in detail before TARP passed.

[riderinthestorm]

35. I'd really like a link proving that. My faith in Obama is severely shaken tonight.

Those bonuses were known about when the initial AIG bailout was discussed under the Bush Admin back in fall 2008. Even we knew about them here on DU.

Many DUers were pretty shocked and amazed that Obama kept Geithner and Summers onboard from the Bush Admin. Right now, I'm deeply troubled at the appearance of impropriety from the White House. I'd like to believe it's just Geithner and Summers but at this point, I'm deeply cynical.

[Truth2Tell]

39. Actually, they didn't come from the Bush admin.

But they might as well have.

[Truth2Tell]

23. I think Geithner is Wall Street stooge

and a complete jackass.

As to why he is in the Obama admin to begin with, I don't know.

[masuki bance]

27. I smell a rat- "White House confident in Treasury's oversight"

Someone is trying to tie this to Obama instead of Dodd.

WASHINGTON (AP) - The White House stood by Treasury Secretary Timothy Geithner on Tuesday amid widespread outrage over millions of dollars in bonuses insurance giant AIG gave to executives after receiving federal bailout money.

White House spokesman Robert Gibbs said President Barack Obama had confidence in Geithner and the Treasury Department's oversight. But Gibbs underscored that Obama is working as quickly as possible with Congress to find ways to block the bonuses at the American International Group Inc. (AIG) or at least to recoup the money.
http://apnews.myway.com/article/20090317/D97025SG0.html

[Louis-Emmanuel]

30. That AP article doesn't quote anyone denying anything

It simply says that Obama has confidence in Geithner. It doesn't say anything about whether Dodd or Geithner wanted to limit the bonuses.

[amandabeech]

49. No. n/t

[Bolo Boffin]

29. Greenwald doing the smearing? With the Obama Adminstration's own words?

I don't think so. Looks like Greenwald has his ducks in a row.

[Louis-Emmanuel]

25. What I understand is that the WSJ article is correct

The WSJ is telling the truth in saying that Dodd favored a limit on bonuses, but Obama administration official opposed it. This means Dodd was trying to do a good thing while Obama administration officials were opposing that good thing.

WSJ:

The most stringent pay restriction bars any company receiving funds from paying top earners bonuses equal to more than one-third of their total annual compensation. That could severely crimp pay packages at big banks, where top officials commonly get relatively modest salaries but often huge bonuses.
As word spread Friday about the new and retroactive limit -- inserted by Democratic Sen. Christopher Dodd of Connecticut -- so did consternation on Wall Street and in the Obama administration, which opposed it.

[WeDidIt]

32. At this point?

I BLAME EVERY LAST DAMNED MEMBER OF THE GOVERNMENT!

[Igel]

34. That's all well and good, but there's a problem.

And that problem is that Geithner and Summer do not draft legislation, have no authority to insert language into legislation, and have no authority for introducing bills.

Somebody on the conference committee had to insert it on his/her authority, no matter *who* asked them to do it. So Dodd wasn't in the conference negotiations, fine. Who was, and on who's authority was it inserted?

Blaming somebody from the executive for insisting that the language be put in doesn't do the trick ... note the weaselly passive. Somebody with authority to put it in actively put it in. Got a name?

[Truth2Tell]

38. It's quite common, as I'm sure you know,

for an administration to have a friendly legislator insert language on their behalf. If the administration was pressing hard for these provisions then they bear responsibility for them. Of course many legislators, including the one who actually inserted the amendment, share responsibility for this very predictable debacle.

[MiniMe]

40. They are gunning for Dodd, they think they can beat him.

[Name removed]

41. Deleted message

Message removed by moderator. Click here to review the message board rules.

[musette_sf]

43. enjoy your stay

:eyes:

[masuki bance]

42. How does it feel to be used by the right wing thugs?

[burythehatchet]

47. Is your anus a little tight around the neck?

[masuki bance]

52. Facts don't fit your narrative?

[burythehatchet]

53. Most be dark up there. Here's what the far right Huffingtn post reports

The Treasury Department demanded that Sen. Chris Dodd insert exemptions into the stimulus bill that allowed bailout recipients to receive bonuses, the Connecticut Democrat said on Wednesday.

According to Dodd, officials at Treasury expressed concern that if the government were to prohibit payouts, it risked being sued by companies like AIG, which had contracts stipulating that bonuses were to be paid.
http://www.huffingtonpost.com/2009/03/18/dodd-treasury-officials-i_n_176609.html

But please, don't let that stop you from making an ass of yourself. Its actually quite funny.

[masuki bance]

60. If Dodd is your go to guys for facts, it explains a lot.

[AZ Criminal JD]

44. Right-wing lie?

I guess Dodd himself is part of the right wing conspiracy. http://www.cnn.com/

[jeanmarc]

45. OP, read this

http://www.cnn.com/2009/POLITICS/03/18/aig.bonuses.congress/index.html?eref=rss_topstories

Dodd did it at the behest of the administration. He's complicit with whatever other boob(Sumner, Geihtner)helped make this possible.

[amandabeech]

50. Actually, as posted above, someone on the conference committee, or his or her staffer,

put it in at the request of someone from Treasury.

The Senator or Member whose staffer put this in needs to step up. He or she should share a good deal of the blame here.

[HiFructosePronSyrup]

46. Whoops.

[notesdev]

51. Dodd is no "dew-eyed innocent"

He is the #1 recipient of AIG political donations. #2 is Obama.

Neither one of them are on our side. Both of them (along with many, many others whose proper duty is to represent the people, not these corporations) are working for the fraudsters. The payroll numbers are there in black and white.

[notesdev]

54. This should put the matter to rest

http://politicalticker.blogs.cnn.com/2009/03/18/breaking-i-was-responsible-for-bonus-loophole-says-dodd/

Wake up people! Just because they're Democrats doesn't mean they can be trusted! These companies don't give a hundred thousand dollars to a single elected official and expect nothing in return. And they wouldn't keep doing it unless it paid off big.

[wisteria]

56. He is not admitting to anything more than compromising with others

on the issue of past and future compensation. He was the first to bring up the subject of the bonuses and if he hadn't chances are this issue would not of even been addressed.

[notesdev]

57. It is not hard

to figure out why a guy getting $100,000 from AIG might request such a thing, and why another guy getting $100,000 from AIG does not feel like it's something to stand up for.

This is what a bought and paid for lawmaking operation looks like. Dodd's excuse is that has no idea what's the in the bills he's pushing and voting for? If that's so, then it is because these bills are authored on desks paid for by AIG, and Dodd does not even review their work before attempting to make it law.

[Thrill]

58. Dodd was acting alone. Blaming a low level Treasury official is amateurish

More info coming out

Dodd did not name the administration officials in his statement, which came a day after he told CNN that he had nothing to do with the change in the provision. In his statement Wednesday, Dodd said he was referring to action to protect AIG.

"When I saw that my comments had been misconstrued, I felt it was important to set the record straight — that this had nothing to do with AIG," he said.

Over the years, Dodd has been the top recipient of campaign contributions from AIG employees. During 2007-2008, when he ran for president, he received nearly $104,000 from AIG employees and their families, according to the Center for Responsive Politics, a nonpartisan group that monitors money in politics.

http://news.yahoo.com/s/ap/aig_bonus_congress