From the WSJ:
A provision in President Barack Obama’s stimulus law might have forestalled payment of $165 million in bonuses to employees of American International Group Inc., but was altered before final passage at the request of the Obama administration, Senate Banking Committee Chairman Christopher Dodd said Wednesday night.
Mr. Dodd, a Connecticut Democrat, introduced a provision into the stimulus that capped executive pay, among other things. But the final language specifically excluded bonuses included in contracts signed before the bill’s passage — a broad category that included the AIG bonuses. At the time, few objected to that move, which was designed to ensure the measure was constitutional.
“I did not want to make any changes to my original Senate-passed amendment but I did so at the request of Administration officials, who gave us no indication that this was in any way related to AIG,” Mr. Dodd said in a statement. “Let me be clear — I was completely unaware of these AIG bonuses until I learned of them last week.”
After the recent furor relating to the AIG payments, lawmakers returned to make a forensic examination of the provision seeking to assign blame for what some called a secret agreement to spare the tottering insurance giant, which has received more than $170 billion in federal aid. The provision and its genesis consumed Capital Hill Wednesday.
“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,” said Sen. Ron Wyden, (D., Ore.), author of an earlier, alternative pay amendment, told the Associated Press.
The Obama administration had not tried to hide its concern about the moves to clamp down on executive compensation. Both Treasury Secretary Timothy Geithner and National Economic Council Director Lawrence Summers lobbied Mr. Dodd to make changes.
Administration officials said the Treasury didn’t suggest any language or say how the amendment should be changed. They said they noted legal issues that could likely lead to challenges, but was the end of their involvement. The official said Mr. Dodd and Congress made the final changes on their own.
At issue were competing provisions in the stimulus bill that capped executive compensation for recipients of bailout funds. One, drafted by Sens. Wyden and Olympia J. Snowe (R, Maine), would have capped bonuses at $100,000, retroactive to 2008. Companies awarding bonuses above that level would face the choice of returning those funds to the Treasury or having them taxed at 35%.
Another, by Mr. Dodd, slapped sharp limits on all compensation of top employees, including bonuses.
Both amendments passed the Senate easily, but during House and Senate negotiations, the Wyden-Snowe amendment dropped out of the bill with little fanfare. Lawmakers and the administration raised constitutional objections, since it would have taxed 2008 income retroactively.
Its authors argued that because companies were given a choice whether to return the bonuses or face a tax, the measure was not actually taxing past income but would “tax” a company’s future decision — made with full knowledge of the consequences.
After the retention bonuses at AIG came to light this weekend, the Wyden-Snowe efforts were hailed as tragic heroism, with Republicans and the media demanding to know who was responsible for its backroom execution.
Mr. Dodd was criticized for his role in the matter, a problem considering his already difficult re-election run next year. Mr. Dodd is the top all-time beneficiary of AIG campaign contributions, with a total of $280,000 in donations from the company’s employees and fund-raising arm since 1990, according to campaign finance data collected by the nonpartisan Center for Responsive Politics. A Dodd spokesman had no immediate comment on the campaign contributions Wednesday.
In an irony, Mr. Dodd managed to sharpen other language in the provision while acceding to the administration’s request. That new language clarified that contracts existing before passage of the stimulus bill could be violated in the extraordinary circumstance of “national interest.” That’s the language the administration hopes now to use to claw back the AIG bonuses.
What are we, 8 weeks in and already the Obama administration is eating its own?
If we weren’t all getting so horribly screwed by this confederacy of dunces, it might actually be amusing.
Instead, it’s like some surrealist tragicomedy being played out in our living rooms, and the leads don’t seem to care if the furniture gets smashed, or if they break several mirrors, yank out a toilet, and rip out some air ducts as part of the “performance.”
God help us all.
(h/t Terry H)
***
update: David Freddoso, the Corner:
House Speaker Nancy Pelosi (D, Calif.) deepened the mystery of the AIG bonus clause this morning. In a press conference, she appeared to be claiming that no one from the House had been present at the House-Senate conference committee where AIG the provision was inserted:
“This is Senate-White House language…If you want to talk about what happened in the Senate, go to the Senate and talk to them…It was never brought to conference…This never came to the House side. You can talk to any of our conferees.”
(The Hill offers a more detailed write-up here.) Pelosi’s statement is at least inaccurate in that the bill came to the House side with the AIG provision, and passed on a roll call vote. But if the House Democrat conferees (Charlie Rangel, Henry Waxman, and David Obey) were not present for the House-Senate conference committee, where were they? Were they, like the Republican conferees, locked out of negotiations?
If this kind of buffoonery and corruption is what is leaking out, imagine how much we’re not hearing about…
(h/t cj burch)
At least the guys get shirts.
Does this let us off the hook? Cause if it did that would be really nice.
Maguire looks like Babe Ruth taking batting practice in his coverage of this financial fiasco.
*Swat*
Crowd: Oooooooooh.
*Swat*
Crood: Wheeeeeeee!
I wasn’t really there either. No one was. The amendment just spontaneously generated. Of course, we are all fascinated and appalled.
This is all a distraction.
Michelle looks great in a sleeveless dress! You rubes are just too dumb to understand the important stories of the day.
Tim Geithner is the only man for this job, by gum!
Hey, I know, let’s re-elect Orrin!
What to think….Should we be happy that our political class is wasting so much time and energy with this bonus crap (which in the grand scheme of things amount to not much of anything) that they don’t have time to really screw things up? Or is this a smoke screen masking the really big maneuvers from our sight? Obviously these stupid bonuses and the AIG execs are the Monster of the week. When looked at in the light of this JournoList garbage, it all starts to seem so choreographed. Or maybe I’m just paranoid?
“If this kind of buffoonery and corruption is what is leaking out, imagine how much we’re not hearing about…”
Jeff, If your intent was to frighten the bejabbers out of me – consider yourself successful.
In light of recent information, I call on the AIG officials to commit reverse Seppuku.
Anyone know where I can find one of those super intelligent teleprompters? I checked Craigslist already.
This is an outrage. I demand Congressional hearings. This sort of backroom politics won’t be… hey look, pie!
Don’t worry. I talked AIG’s thumb off the button. It was like a suicide bomber until I got involved, you know.
look wide/with your botoxed eyes
a fat guy on your right side/
ps/ get ur thumb off my button u damn dirty ape[yeah- i said it!]
Most ethical congress ever ? I’m thinking most ethical group of people in the history of the world.
Even though the economy is tanking, I would enjoy 4 years of the Teleprompter throwing congressional dems under the bus.
THAT is not the Chris Dodd the Teleprompter knew.
Don’t drag me into this, Mr. President. Hey, thanks for the easy billion in foreign aid though.
LTC John – I concur wholly. I’m sure we can also find some racist overtones in the “buffoonery” comment.
I, for one, only want to hear about the other stuff in the context of tar and feathers and rail cars.
Any talk of Congress’s role in this is a distraction from the real villains, capitalists.
JournoList Assemble!!!!!
I did not do any of the other socks but after changing my name to Paul Krugman I think I need a shower.
This is not the suicide bomber I knew.
Jeff you are spot on this. So who is playing the role of Ignatious J. Reilly in this mess…or dare I suggest “The One”?
Dad:”Boy, you’ve pissed your pants!”
Son:”It wasn’t me Dad. Honest. A big boy done and ran away!”
Not now, Krugman, we’re busy with the bare-chested Obama pictures Ezra Klein just posted.
Senator Dodd, Try about half a dozen shots of Jameson at the pub down the road from your Irish summer cottage.
Chris Dodd wouldn’t thank himself if reading from a teleprompter. He’s a smart cookie.
OCTOMOM!!!!!!!!!
Ok we got a new Demon of the Week, Mike Krzyzewski. Get him boys, I want to know if his freakin child support payments are up to date by tommorrow.
If I was Chris Dodd, I’d make a funny face, hit the applause sign button and go to a commercial.
Christian Laettner? That guy was twice as likable as Chris Dodd.
The country is being ruined by some sort of evil Three Stooges Cabal of Incompetence.
The One’s Teleprompter is now blogging:
http://baracksteleprompter.blogspot.com/
What. The. $#%&*??!!??
Are they kidding me? “Taxing future actions”?!? That is just some Grade A USDA prime Gobbledygook double speak right there.
It’s amateur hour in American Government and the inmates are running the asylum. Nuke ’em from orbit. All. Of. Them.
Funny, I’ve been thinking the same thing, BJT. Washington obliterated? I’m not so oddly unperturbed.
Hey, I know, let’s re-elect Orrin!
He won’t be getting my vote next time, just like he didn’t last time. And the other senator from Utah, Bob Bennett, was #4 on the list of top Fannie/Freddie donation recipients, right after Dodd, Kerry, and Obama.
Well his teleprompter seems to be malfunctioning.
http://www.breitbart.com/article.php?id=D971964O1&show_article=1
President Barack Obama, who took office just under two months ago, told reporters Wednesday that his administration was not responsible for a lack of federal supervision of AIG that preceded the company’s demise.
But Obama added, “The buck stops with me.”
WTF???????????????
we all know
Mike K
whittled the lacrosse sticks
white[not that that matters]
sticks
that the dear oppressed college student
practiced her pole dance on..
lacrosse/hoops?
balls and boys?
ha!
i’d never root 4 duke
the world is upside down!
Barney Frank cannot hide is fannie hole? What is the intent of Patterico’s post here?
One of these days we’ll all start assuming that these fucks aren’t listening to anything but their handlers in banking.
Nah. Surely that’s not it.
Heh.
You mean, other than the fact that Karl posted it, Joe?
Kelly- why do you think audiences at the first screenings of Independence Day cheered at the obliteration of DC?
Handwriting analysis is what they need as so much of it was handwritten at the last minute, or after passage even.
FYI I’m not this JournoList.