USA Today, LA Times continue to omit Bush Treasury's role in AIG bonus controversy
SUMMARY: USA Today and the Los Angeles Times reported Republican criticism of the Obama administration over AIG's employee bonus packages but did not point out that it was the Bush Treasury Department that worked with the Federal Reserve in carrying out last year's bailouts and bought AIG stock notwithstanding the existence of these bonus contracts.
In March 18 articles, USA Today and the Los Angeles Times reported Republican criticism of the Obama administration over American International Group's (AIG) employee bonus packages but did not point out that it was the Bush Treasury Department that worked with the Federal Reserve in carrying out last year's bailouts and bought AIG stock notwithstanding the existence of these bonus contracts. On March 17, USA Today and the Times similarly ignored the Bush administration's involvement in the AIG controversy, as Media Matters for America documented.
USA Today reporters John Fritze, Mimi Hall, and Adam Shell reported on March 18, "Treasury Secretary Timothy Geithner -- who had come under criticism for his handling of the issue by Republican lawmakers, including Sen. Richard Shelby, R-Ala. -- promised in a letter Tuesday night to House Speaker Nancy Pelosi that Treasury will recover all the money." They further reported:
Republican lawmakers including Shelby questioned why President Obama and Geithner did not take action to stop the bonuses earlier. Shelby told CBS' Early Show it was another example of Geithner being "out of the loop." Shelby asked, "Where was Treasury before this money was paid out?"
At no point did USA Today mention that the Bush Treasury Department also "did not take action to stop the bonuses" when it approved the bailouts.
Similarly, Los Angeles Times reporters Jim Puzzanghera and Janet Hook reported on March 18, "[Sen. Charles] Grassley [IA], the senior Republican on the Senate Finance Committee, asked Treasury Inspector General Eric Thorson to open an inquiry into the AIG bonus payments and determine whether top Treasury officials had some role in approving the payments, according to Grassley's office." Puzzanghera and Hook further wrote:
The inquiry could turn the heat back on the Obama administration, which has expressed outrage over the payments and wants to challenge them.
In a letter to Thorson obtained by The Times, Grassley asked whether Treasury officials made any previous efforts to block the bonus payments or demanded that the payments be waived before releasing taxpayer bailout funds to the company. Thorson also would examine whether there are contracts that compel the payments and, if so, when those legal obligations were created.
[...]
Democrats tended to blame corporate greed. Republicans harshly criticized Geithner, though they stopped short of calling for his resignation.
Geithner approved the bonuses last weekend after determining that they were contractual obligations by AIG that could prompt lawsuits if not paid. His decision came less than two weeks after federal officials agreed to extend AIG an additional $30-billion line of credit on top of the $150 billion in bailout funds the government had already sunk into the company.
"What I'd like a full explanation of is how the Department of the Treasury handed over $30 billion a mere two weeks ago and didn't have any idea that this outrage was going to occur," Senate Minority Leader Mitch McConnell (R-Ky.) said.
The Times did not mention, however, that the Bush Treasury Department "handed over" a greater sum to AIG without addressing the company's bonus contracts.
By contrast, in a March 17 Politico article, executive editor Jim VandeHei wrote that "[t]he bonuses were essentially a nonissue when AIG got its initial bailout money, almost $150 billion under President Bush in the two months surrounding the presidential election." As Media Matters noted, The Washington Post reported on March 17 that "AIG disclosed its retention-payment program more than a year ago, and the amount of the bonuses -- more than $400 million for Financial Products alone -- had been widely reported."
In a September 16, 2008, article about the initial bailout of AIG, The New York Times reported: "Fearing a financial crisis worldwide, the Federal Reserve reversed course on Tuesday and agreed to an $85 billion bailout that would give the government control of the troubled insurance giant American International Group." In a November 10, 2008, article, the Times reported that the Bush Treasury Department and Federal Reserve announced a "revised bailout" of AIG, under which "the Treasury Department will use the Troubled Asset Relief Program [TARP], the $700 billion financial system rescue plan, to buy $40 billion of newly issued A.I.G. preferred shares." Senate Minority Leader Mitch McConnell (R-KY), who was quoted in the Los Angeles Times article criticizing the Obama administration's recent handling of AIG, voted to pass the October 2008 TARP legislation -- a fact the Times article did not note.
From the March 18 USA Today article:
As new details emerged about $165 million in bonuses paid by insurance giant AIG, lawmakers and administration officials sought ways to recoup the money either by imposing stiff new taxes on the extra pay or requiring the company to return it in exchange for future taxpayer aid.
[...]
Treasury Secretary Timothy Geithner -- who had come under criticism for his handling of the issue by Republican lawmakers, including Sen. Richard Shelby, R-Ala. -- promised in a letter Tuesday night to House Speaker Nancy Pelosi that Treasury will recover all the money.
[...]
Republican lawmakers including Shelby questioned why President Obama and Geithner did not take action to stop the bonuses earlier. Shelby told CBS' Early Show it was another example of Geithner being "out of the loop." Shelby asked, "Where was Treasury before this money was paid out?"
White House Press Secretary Robert Gibbs said Obama had "complete confidence" in Geithner.
From the March 18 Los Angeles Times article:
Grassley, the senior Republican on the Senate Finance Committee, asked Treasury Inspector General Eric Thorson to open an inquiry into the AIG bonus payments and determine whether top Treasury officials had some role in approving the payments, according to Grassley's office.
The inquiry could turn the heat back on the Obama administration, which has expressed outrage over the payments and wants to challenge them.
In a letter to Thorson obtained by The Times, Grassley asked whether Treasury officials made any previous efforts to block the bonus payments or demanded that the payments be waived before releasing taxpayer bailout funds to the company. Thorson also would examine whether there are contracts that compel the payments and, if so, when those legal obligations were created.
[...]
Democrats tended to blame corporate greed. Republicans harshly criticized Geithner, though they stopped short of calling for his resignation.
Geithner approved the bonuses last weekend after determining that they were contractual obligations by AIG that could prompt lawsuits if not paid. His decision came less than two weeks after federal officials agreed to extend AIG an additional $30-billion line of credit on top of the $150 billion in bailout funds the government had already sunk into the company.
"What I'd like a full explanation of is how the Department of the Treasury handed over $30 billion a mere two weeks ago and didn't have any idea that this outrage was going to occur," Senate Minority Leader Mitch McConnell (R-Ky.) said.
In a contentious briefing dominated by the AIG issue, White House Press Secretary Robert Gibbs said that President Obama retained confidence in Geithner.
On Monday, Obama had ordered his administration to "pursue every legal avenue" to challenge the bonuses. Legal experts said that would be difficult and could lead to lawsuits.
Some lawmakers said they were concerned about the legality of a tax that would wipe out the bonuses in their entirety, but one tax-law expert saw no impediment to doing so.
Well, if they stick to the facts, the gops have got bupkis and there's no story.
The MSM & press have a new theme that is blame Obama & Geithner for everything and whitewash the last 8 years of Bush horror.
The press have made up their minds that less than 60 days in and this is Obama & Geithner's doing.
a better headline would be: MMFA continues to omit Geithner's and White House's role in AIG bonus controversy.
Perhaps if one did not bother to read the reports that Media Matters cites, which contain several mentions of Geithner's and the White House's role, then one might think such a headline would somehow be "better". But, having said that, I'd like to think such a thought would soon be abandoned if one took the time to actually read the reports.
right now they are all finger pointing at one another, Dodd, Wyden at the White House, and the WH at the conference committees that put this together a month ago......yet mmfa wants no part of that squabble so they blame Bush. I get it.
If there some specific misinformation that you're seeing reported on the matter that you'd like to get off your chest?
i said omission, not misinformation, try and keep up.
Right, and neither Geithner's nor the White House's role was omitted. Gosh, you're petty.
“a better headline would be: MMFA continues to omit Geithner's and White House's role in AIG bonus controversy.”
It would be a false headline based upon your inability to either read or comprehend the MMFA article.
To help you out, I’ve copied and pasted a few excerpts of the MMFA article which clearly illustrate that MMFA is not omitting Geithner’s role or the existence of his critics:
"Treasury Secretary Timothy Geithner -- who had come under criticism for his handling of the issue by Republican lawmakers, including Sen. Richard Shelby, R-Ala. -- promised in a letter Tuesday night to House Speaker Nancy Pelosi that Treasury will recover all the money."
Republican lawmakers including Shelby questioned why President Obama and Geithner did not take action to stop the bonuses earlier. Shelby told CBS' Early Show it was another example of Geithner being "out of the loop."
Geithner approved the bonuses last weekend after determining that they were contractual obligations by AIG that could prompt lawsuits if not paid.
"What I'd like a full explanation of is how the Department of the Treasury handed over $30 billion a mere two weeks ago and didn't have any idea that this outrage was going to occur," Senate Minority Leader Mitch McConnell (R-Ky.) said.
Glad I could be of help. You’re welcome.
you're not serious with those examples, are you? Geithner said he'd recover the money, how? He knew about it and now got caught, of course he has to say that. The other one is Republican Shelby, he's a Republican so of course he lies. Geithner said they were contractual AFTER he specifically took them out of the equation. And then McConnell's statements again, he is a Republican so he lies by default. Those are supposed to indict Geithner and therefore mmfa is fully disclosing what? you helped alot, thank you.
So you admit there was no 'omission' on the part of MMFA- got it!
My advice is to ACTUALLY READ the piece before you speak, JimmyB.
omission of the timeline and what reportedly actually happened, yes. glossing over it by quoting partisan Republicans or Geithner's lame excuses themselves is omission of what's relevant, you too, try and keep up.
And now the goal posts have moved.
Originally, you demand mention of "Geithner's and the White Houses's role."
When it's revealed that it already exists, you demand a timeline of what happened.
Make up your mind.
i guess should have specified "honest" and "forthcoming" role. sorry, I didn't think those needed to be included, thought they were a given. but I guess when you go to any lengths and mince words to avoid implicating sacred Democrats or mmfa, you will focus on stuff like that.
How does MMFA's quoting of the line "Geithner approved the bonuses..." avoid implicating him?
What about mentioning Geithners role last fall when he was with the Federal Reserve?
I'd say start with the LA Times and USA Today, since I can't find any mention of it in their articles either.
Personally, I never liked Geithner from the beginning and I find myself disliking him more and more every day, but to say that MMFA is "omitting his role" is absurd.
1. Isn't the Obama machine saying they did not know about the bonuses until recently?
Either way ...
2. But here's the real reason MM is mad at the Times. They actually exposed the corruption of one of MM's own in their article:
MM sure doesn't like it when a usually-friendly operation shines the light on one of their friend's corruption!
I'm not seeing the part where MMFA mentions that Geithner was the head of the Federal Reserve last fall and therefore was right in the middle of these bailouts in working with the Bush Treasury Department. I'm not seeing that mentioned but perhaps I'm missing it.
At least Thom Hartman today was pointing the finger at Geithner, I'll give him credit for that.
the chips should fall where they may in this entire financial mess and fiasco, that only seems to get more muddled and corrupt and sleazy as time goes on. it matters little what party did it, or who should cover for who's a$$ - those responsible should resign or at least fess up to exactly what happened, instead of pointing fingers and trying to find a politically opportunistic way to wiggle out of it. this is far too serious.
I agree and that's why I'm frankly disappointed in the overall coverage. There has been a lot of misinformation on both sides I believe.
I don't believe Geithner will survive this.
no arguments there, but now Dodd just reversed course. no idea why unless he got some pressure from somewhere? I said early Geithner wouldn't survive either, but maybe he has been spared. whatever happened, why can't these clowns just tell us the awful, bitter truth - if they left the provision in allowing these bonuses, just say so. move on, bigger fish to fry anyway.
I just saw that. Oops! Hmm, did Dodd just refute a few of MMFA's posts?
Who knows what's going on.
>>I just saw that. Oops! Hmm, did Dodd just refute a few of MMFA's posts?
I don't think it refuting this one. I just read the whole CNN piece (front page, CNN). "Both Dodd and a Treasury Department official who asked not to be named said the administration pushed for the language because it was afraid the government would face numerous lawsuits without it."
That makes sense. It seems Bush's job to have made sure the bonuses were not in place when he passed the bailout bill. Dems can't go back and undo such a big mistake, not at least without creating more problems.
Whom in the Obama Administration did Dodd say presured him to put in the exemption amendment? It's time Dodd truly comes clean and tells THE WHOLE TRUTH. Time to put Dodd under oath.
Again, Bush Treasury was working with the Federal Reserve - Geithner during all of that last fall. There is not a disconnect here that some people are hoping for.
>>Again, Bush Treasury was working with the Federal Reserve - Geithner during all of that last fall. There is not a disconnect here that some people are hoping for.
That can be the case, but Geithner is claiming he did not know about the bonuses. That may or may not be true, but you are not citing anything specific to back up your allegation. How closely did they work? And even if they worked closely and Geithner knew, meaning he would have to resign, that wouldn't absolve Bush's part.
At this point we just don't know.
This article talks about Geithners involvement:
http://www.latimes.com/news/la-fi-aig16-2009mar16,0,6997051.story?page=2&track=rss
But one leading academic in the national policy debates said Geithner should have reined in AIG compensation when, in his former role as the head of the New York Federal Reserve Bank, he was working with Bush administration Treasury Secretary Henry M. Paulson to negotiate the first round of bailouts.
Geithner "should be embarrassed," said Peter Morici, a University of Maryland business professor and former chief economist for the U.S. International Trade Commission.
"When the Bush White House agreed to bail out General Motors and Chrysler, it required those companies to renegotiate their labor contracts," Morici said.
"Why did Secretaries Paulson and Geithner not require the same at AIG? The threat was the same with AIG and GM. If either shut down, the economy would plummet into chaos and depression, we were told," Morici said.
Robert Gorges, a retired Ralphs grocery worker from Highland, near San Bernardino, agreed.
Auto workers, he said, "had a contract but they did the right thing, knowing their company was in bad financial trouble. They changed their contract," he said. "Not the same can be said about AIG," Gorges said in his e-mail to The Times. "Something is wrong here."
But you left out this part of the article:
The easy thing would be to just say . . . 'Off with their heads, violate the contracts,' " Summers said. "But you have to think about the consequences of breaking contracts for the overall system of law, for the overall financial system."
Summers said Geithner used all his power, "both legal and moral, to reduce the level of these bonus payments."
What role did Geithner actually play? If Geithner was part of the Fed, which controls money supply and handles monetary (as opposed to fiscal) policy, would he have been responsible for the contracts?
Also, quoting a grocery worker as an expert is a little silly on the part of the artile.
That having been said, Summers has followed a neo-liberal economic policy which has failed diastrously in the past. He has yet to apologize or admit he was wrong, and worse, Obama appoints him to his cabinet.
MM further debunked! LOL!
CNN BREAKING: I was responsible for bonus loophole, says Dodd
MM totally debunked here, folks!
^&
How, other than in your mind?
Time for a new MMFA Article?:
"Chris Dodd repeats the lie that Chris Dodd was responsible for the exemption to AIG bonuses"
http://politicalticker.blogs.cnn.com/2009/03/18/breaking-i-was-responsible-for-bonus-loophole-says-dodd/
Alittle off topic here, but I think it fits. Why are the Democrats so outraged by the 160 million in bonuses which represent only 1/10 of 1 % of all the money AIG got, but at the same time telling us the earmarks are only 2% of the stimulus bill and are no big deal. I don't believe that AIG should get 1 penny in bonuses, however the hypocrisy of the left to "go after" this money is funny when they(both parties) are spending 40 times this amount in wasteful earmarks. They could more easily get back 160mil from the stimulus bill then this political football.
If it were that simple, so why did Dodd, Geithner, and Obama lie through their teeth about the deal. They are the rankest hypocrites. They should all resign.