Tim Geithner and Congress claim that they got blindsided by the AIG bonuses late last week, before anyone had a chance to stop AIG from paying them. However, C-SPAN’s video library tells a very different story. Watch the clip from a March 3rd hearing of the House Ways and Means Committee in which Rep. Joseph Crowley (D-NY) specifically mentions the upcoming payouts of over $162 million in bonuses to AIG execs, the very same number that inflamed Washington DC this week:
After accusing the previous administration of a lack of oversight, Crowley says this, emphasis mine:
Thank you, Mr. Chairman. Welcome to the committee, Mr. Geithner, and thank you for your responses so far. It never ceases to amaze me the level of apparent amnesia some of my colleagues on the other side of the aisle have had about how we got to this problem in the first place, and I thank you for answering Mr. Heller’s question in particular. By the line of questioning, you’re almost led to believe that because of a last month and a few days of a presidency we had the problem we have today, and thank you for setting the record straight. This didn’t happen overnight. This took eight years in the making of stagnant, at best, growth.
But yesterday, Mr. Secretary, the Treasury and the Federal Reserve announced a new fourth plan to rescue troubled financial services giant AIG. I do agree that AIG’s sustainability is the lynchpin for some of our recovery efforts, and it’s important for the federal government to work to keep it afloat. However, I must demand that AIG increase the accountability and transparency, something that was not done during the previous administration.
For example, just last month, AIG paid 343 employees of AIG FP — their Financial Products division that created the financial hole that AIG is in, and in turn a multibillion-dollar bill for American taxpayers — $56 million in bonuses and are slated to pay an additional $162 million in bonuses to 393 participants in the coming weeks. And there’s more. Further bonus payments totaling approximately 230 million (dollars) are due to 407 participants at AIG’s Financial Products division in March 2010. This makes no sense to my constituency.
In other words, everyone knew about these bonuses. Congress even knew enough about it to question Geithner on it, with remarkable accuracy on the total amount due to be paid out, on March 3rd — nine days before Geithner initially claimed to know about it.
This whole episode has been a farce perpetrated by Congress and the administration to stoke artificial outrage over contractual compensation obligations. It’s a freak show put on by Democrats. They’re giving us populist circuses in order to build a mob mentality — but for what purpose?