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US Rep Pelosi:Fed Chairman Partly To Blame On AIG Bonus Fiasco

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sabra Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Mar-19-09 11:54 AM
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US Rep Pelosi:Fed Chairman Partly To Blame On AIG Bonus Fiasco
Source: CNN Money

WASHINGTON -(Dow Jones)- U.S. House of Representatives Speaker Rep. Nancy Pelosi, D-Calif., said Federal Reserve Board Chairman Ben Bernanke deserves at least part of the blame for American International Group Inc. (AIG) executives receiving $165 million in bonuses at taxpayer expense.

Speaking at a press conference Thursday, Pelosi said it was the Fed that initially provided financial assistance to the beleaguered insurance giant in September, with little involvement from congressional lawmakers.

"The announcement was made by the chairman of the Fed (it) would be making this big infusion of cash into AIG without any prior notification to us," Pelosi said. "We didn't even know (the Fed) had that kind of money...That's when it all started."

In her comments Pelosi wanted to separate House Democrats from any responsibility for the bonus fiasco, which has ignited into a major political firestorm.

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KoKo Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Mar-19-09 12:03 PM
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1. In the article Pelosi puts blame for Bonus payments on Senate and Bush/Obama...
Good for her in calling out the Senate. The House voted down the TARP relief the first time but the Senate "sweetened the pot" for some House members to get the TARP through on the second vote.

The House has not been the problem in putting forward breakers on Bush's give aways and Geithner''s been the Senate time after time.


She said that last year the Bush administration resisted any attempts to include executive compensation language in the initial legislation creating the Troubled Asset Relief Program, or TARP.

Pelosi also said the watering down of the compensation language in the economic stimulus bill was a matter between the Obama administration and Sen. Christopher Dodd, D-Conn., the chairman of the Senate Banking Committee. She said House Democrats were never involved in the negotiations.

A Senate version of the legislation included three amendments aimed at placing limits on executive compensation at firms receiving money through the TARP.

But in last-minute negotiations on the day the final version of the legislation was agreed to between House and Senate lawmakers, the compensation language was significantly altered.

Pelosi said that House Democrats had nothing to do with it.

The House passed legislation in January that would have imposed significant limits on financial firms receiving taxpayer money, but the Senate never took up the legislation.
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Traveling_Home Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Mar-19-09 12:18 PM
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3. Isn't she also admitting ....

that the House version of the Stimulus Bill had nothing in it regarding executive compensation. If not for Dodd and the Senate therre wold have been no limits of any kind.

Pelosi just spins in the wind.
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EFerrari Donating Member (1000+ posts) Send PM | Profile | Ignore Thu Mar-19-09 12:14 PM
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2. Robert Scheer says AIG is a shell to pass money to Goldman Sachs et al:
Perp Walks Instead of Bonuses
Posted on Mar 17, 2009

By Robert Scheer

There must be a criminal investigation of the AIG debacle, and it looks as if New Yorks top lawman is on the case. The collusion to save this toxic company in order to salvage the rogue financiers who conspired to enrich themselves by impoverishing millions is being revealed as the greatest financial scandal in U.S. history. Instead of taking bonuses, the culprits should be taking perp walks.

Im not just referring to the swindlers in the Financial Products Subsidiary of AIG who devised and sold those insurance policies on derivatives that brought the world economy to its knees. They do seem deserving of a special place in hell, and presumably the same divine power that according to Scripture labeled usury a high moral crime and threw the money-changers out of the temple will consider that outcome.

However, the enablers are the AIG leaders who, as New York Attorney General Andrew Cuomo revealed Tuesday, signed those bonus contracts a year ago to reward the very people principally responsible for the firms meltdown. Thats a cool $44 million divided among the top 10 shysters, even though the depth of their chicanery was well known to top management.

As Cuomo noted in a letter to Rep. Barney Frank: The contracts shockingly contain a provision that required most individuals bonuses to be 100% of their 2007 bonuses. Thus, in the spring of last year, AIG chose to lock in bonuses for 2008 at 2007 levels despite obvious signs that 2008 performance would be disastrous in comparison to the year before.
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