Did McCain Just Flip-Flop on AIG and Tweet-Flop on Its Bonuses?
Sen. John McCain (R-AZ) was in fine flip-flopping form during a speech today at the Heritage Foundation, as the Washington Independent reports.
"The problem started when we bailed out AIG," McCain told the conservative crowd at Heritage. "I would have let AIG go bankrupt. If they have to fail, they fail."
It's been well-noted in the blogosphere that McCain originally supported bailing out AIG in September, when his presidential run was in its, er, last throes. But what's most interesting, per the Independent, is that McCain came out against "controlling the salaries and bonuses of TARP-taking executives."
But I thought McCain wanted to let AIG fail exactly because that would deny bonuses to "greedy execs"! He told us so on his Twitter feed!* Sounds like it's time for some Straight Talk TM on AIG executives: Do we let the company fail to deny them bonuses, or let the company fail and make no attempt to prevent them from grabbing bonuses on their way out?
*This is the first and last time Twitter will appear in any of my posts.
Josh
Matt
Eric
Brian
Let AIG completely fail? Does anybody believe that was even an option?
March 26, 2009 2:19 PM | Reply | Permalink
* and by anybody I mean economists across the political spectrum.
March 26, 2009 2:20 PM | Reply | Permalink
I understand that liquidating AIG in bankruptcy might have been disastrous, but I see no reason why the Bush Administration couldn't have requested the receivership legislation now proposed by President Obama instead of requesting bailout legislation. I don't recall Senator McCain suggesting that approach though.
March 26, 2009 2:24 PM | Reply | Permalink
There would have been better ways to handle it, no doubt, but nobody of consequence seriously considered not doing it.
Paulson let Lehman fail a few days earlier (a reckless move in hindsight but driven by his free market faith), so why the sudden change of heart?
Because he knew, like Bernanke, the catastrophic effect the failure of AIG would have had on our economy. It would have led to the bank run to end all bank runs. Money across the globe would have fled the financial system in hours. There was no choice.
March 26, 2009 3:19 PM | Reply | Permalink
I think we agree. I understand that something had to be done. My only point is that AIG (and others) should have been treated as insolvent, not as merely suffering a cashflow dilemma. Consequently, I don't see Senator McCain's comments about bankruptcy as completely offbase (but I do find it ludicrous for him to pretend that was his position back then).
March 26, 2009 3:29 PM | Reply | Permalink
I agree with you. The fact that we (taxpayers) own 80%+ of AIG yet have no say in it's management seems like a pretty bad deal.
March 26, 2009 4:23 PM | Reply | Permalink
Wanna bet?
March 26, 2009 2:19 PM | Reply | Permalink
O-o-o-k-a-a-a-a-y.
He doesn't want them to get bonuses, but he doesn't want to restrict the pay structure.
Tweet-flop. I like that.
How come no one is screaming about why politicians are spending their time tweeting when they should be doing other, more important things? And how come no one was horrified when John McCain picked an NCAA bracket, instead of doing more important things?
March 26, 2009 2:24 PM | Reply | Permalink
Can we all agree on the following definition?
Anyone who Twitters shall be known as a Twit.
(Sorry, Josh. No offense.)
-- ARG
March 26, 2009 2:34 PM | Reply | Permalink
Maybe you'll use Colbert's word for Twitter instead?
http://www.huffingtonpost.com/2009/03/19/colbert-says-twat-on-the_n_176911.html
March 26, 2009 2:45 PM | Reply | Permalink
Just to correct Elena on McCain's trademark, it's:
Straightjacket Talk™.
March 26, 2009 4:26 PM | Reply | Permalink
Now that I think about it, it could also be characterized as Aggravated Perjury.
March 26, 2009 4:28 PM | Reply | Permalink
Shame on you all. Flip-flopping on letting AIG go bankrupt was one of the many things Senator McCain couldn't enjoy when he was being held captive by the North Vietnamese.
March 26, 2009 4:36 PM | Reply | Permalink
"None of the multiple-personality John McCain’s are company you’d want to keep. ... John McCain serves John McCain. And it serves him now to rail and posture about the few issues he can sound knowledgeable about..." I have a lot more to say about "McNasty" (a schoolboy nickname!) at http://sonofthecucumberking.blogspot.com/2009/03/oh-johnny-we-never-knew-ye.html. Hope you'll take a look.
March 27, 2009 2:46 AM | Reply | Permalink