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Report: Treasury Knew About AIG Bonuses Earlier Than Obama Administration Claims
AIG CEO Edward Liddy told the House Financial Services Committee today that the Federal Reserve had okayed his company's planned bonuses in advance -- and now Time magazine reports that the Treasury Department also knew about the ticking political time-bomb earlier than it has acknowledged.
As the magazine reports:
"Treasury staff was informed about the new bonuses in a Feb. 28 memo that the March 15 [bonus-payment] date was upcoming," a Federal Reserve source tells TIME. A Treasury Department source, speaking on background, confirmed the e-mail memo and its contents, saying, "Everybody knew that [AIG] had a retention issue."
When the debate comes down to a Nixon-style "what did he know and when did he know it," things aren't looking good. And we may have just reached that point for Treasury Secretary Tim Geithner.
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Josh
Elana
Matt
Eric
Buried in the fourth paragraph of that article:
Giethner does deserve some of the blame for not being more proactive, but let's not turn this into a witchhunt here.
March 18, 2009 6:13 PM | Reply | Permalink
Amazing what happens when a paragraph is left out.
March 18, 2009 6:17 PM | Reply | Permalink
Buried in the rest of Paragraph Four, which you inexplicably failed to quote:
Emphasis mine. Any comments on why you failed to quote that part?
To quote NCSteve:
Which applies to your selective quotation as well -- although NCSteve doesn't see fit to comment on that. Either he didn't bother to read the entire article, as I did, or he chose not to mention the part you left out. I'm not sure which is worse.
To be fair (huh? What?) the Time piece continues in the next graf:
Now you can be charitable to Geithner and take that at face value, or you can ask whether Geithner as head of the NY Fed ought to have known a little something about the goings-on at AIG. Prof. William Black has -- if not about AIG, then certainly about the banks under his jurisdiction.
Regarding who William Black is, see my comments here.
AIG and the banks are of course pretty closely connected, something which any regulator worth his salt ought to have known. Moreover, what Geithner did regarding the banks, discussed in that article, is very much of a piece with the conduct being discussed here. And it's more than enough to render one skeptical of Geithner's motives and/or competence going forward.
As the title of Professor Black's book tells us, the best way to rob a bank is to own one -- and it helps a lot if you have regulators who are all too willing to look the other way, and later claim that they are shocked, shocked that this abuse has occurred.
March 18, 2009 9:08 PM | Reply | Permalink
Yeah, uh... fail. You mind telling me what part of that contradicts what NCSteve said? I mean, honestly, what are you getting at here? Being part of the negotiations last September meant he knew about the misappropriation of money? Not really a logical connection. Are you implying some sort of conspiracy?
March 18, 2009 9:45 PM | Reply | Permalink
I don't have to, because that's not the point.
Let's review, boys and girls.
1) Schor commits unpardonable sin of not quoting entire article.
2) Forsythe notes an item "buried" in paragraph four.... but selectively quotes that paragraph, leaving out the more damning half.
3) NCSteve and VivaAmerica, meanwhile, gets panties in twist about "selective quotation", while somehow failing to notice Forsythe's selective quotation. That's what we call a "double standard," or, you might say, selective outrage over selective quotation.
Not at all. No conspiracy is necessary. It's suffiicient, and easy, to show that he has: a good set of ideological blinders; together with a 20-odd-year history, along with his mentors Summers and Rubin, of pushing financial sector deregulation (including, in the case of Rubin-Summers, of successfully pushing the repeal of Glass-Steagall); of being far more solicitious of Wall Street interests than of the interests of the economy as a whole; of failing to learn from history (see: 1929); and of an utter failure to see and mitigate coming catastrophe, or to roll back the excesses of the financial sector, in his immediate past regulatory job. All amply documented, and discussed, by a significant number of people who know a hell of a lot more about the history of the last several financial sector debacles than you would ever hope to have -- as I have linked and quoted in several of my other comments over the last few days.
Let's start with Prof. William Black (law, economics). The guy who developed the concept of "control fraud" (look it up), former director of litigation for the Federal Home Loan Bank Board (1984-86), former deputy director of FSLIC (1987), general counsel for Federal Home Loan Bank of SF (1987-89) (where the Keating Five tried to intimidate him and his colleagues into not bringing any enforcement actions against Lincoln Savings -- they succeeded by getting them replaced), deputy director of the National Commission on Financial Institution Reform, Recovery and Enforcement (1992-93), senior deputy chief counsel of Office of Thrift Supervision (1990-94), and ED of the Institute for Fraud Prevention (2005-07), and author of The Best Way to Rob a Bank is to Own One (University of Texas Press 2005).
CV: http://www.law.umkc.edu/faculty/profiles/Black/black_cv.pdf
If Geithner didn't know about the payouts, he should have. That was, you know, part of his job. And his record strongly suggests a propensity to look the other way when Wall Street excess is involved.
Thanks for playing. Write back when you get your hinges back on, 'kay?
March 20, 2009 2:26 AM | Reply | Permalink
Because the newest "feature" of TPM is choking on more than two links in a post, here separately are a couple of Black's articles to get you going.
http://www.huffingtonpost.com/william-k-black/why-is-geithner-continuin_b_169234.html
http://www.huffingtonpost.com/william-k-black/the-audacity-of-dopes_b_165637.html
Not that I expect you'll bother to read them, since they commit the heresy of being critical of an Obama appointee.
March 20, 2009 2:28 AM | Reply | Permalink
So Treasury "staff" knew about it and didn't get the word up to the Secretary.
No wonder the "source" demanded anonymity.
March 18, 2009 6:18 PM | Reply | Permalink
Your headline implies Geithner told a willful lie, although the facts don't support that.
March 18, 2009 6:19 PM | Reply | Permalink
Elana always does that.
March 18, 2009 6:29 PM | Reply | Permalink
So does the "what did he know and when did he know it" crack.
When there's a paragraph from a report omitted from the story that shows both the explicit thesis, and the underlying innuendo of the story are completely off-base, it goes into the kind of reckless "never let the facts get in the way of a good narrative" crap I associate with cable news and, in particular, Fox News.
One would hope for a retraction rather than "an update." So far, however, I'm not even seeing an update.
March 18, 2009 6:30 PM | Reply | Permalink
Respectfully:
1. The "facts" aren't at all that clear yet. What we do know via today's testimony: Bernanke was on board with this entire thing early on, met with Liddy early on. Yet Bernanke has been pretending otherwise, and actually presented himself on 60 Minutes as one of the "outraged" ones. Now we know for certain: It was showmanship. He not only knew about this bonus stuff, but was part of putting it into play when the parameters of the AIG bailout money were first hammered out (without any input from Congress, I might add. Also a fact.)
2. Another fact: We're now almost certain someone (or someoneS) from Obama's treasury department put pressure on people like Dodd and Wyman to take out provisions they wanted attached to the stimulus bill that limited exec pay and bonuses. Heck, that was even reported pretty widely that Obama, Geithner, and Summers weren't too happy about it and had started to make phone calls. Bottom line: People representing the administration's position put the pressure on to exclude those provisions. Dodd managed to get something in that allowed the Sec. of Treasury to intervene if deals were made that weren't in the public's interest, but the restrictions themselves...
3. As for this article: Yes, it's true, a paragraph was left out. But we don't know: a.) if the "official" mentioned in that paragraph was the same one who blew the whistle in Elana's piece (doesn't appear like it), and b.) who that "official" even is. Have to be honest: Sounds more like cover-our-butts-pass-the-blame stuff. (How come it's almost always the "underlings" fault?)
Finally: Is it feasible that Bernanke knew all about the bonus deal with AIG (see #1)...and Geithner didn't? I mean, not even a peep?
P.S. I'm not a troll. I voted for Obama. Gave $$ to his campaign. Think he's done some really good stuff. But on this one: He's blowing it.
March 18, 2009 7:20 PM | Reply | Permalink
Obama simply is not "blowing it".
All of the "facts" you either know or allege point directly to the previous administration and their appointees. Too bad you can't admit it.
It is now Obama's mess to clean up. He said today (and no surprise to his supporters, BTW) that he's responsible for cleaning up the mess.
And it's a big stable he's being asked to muck out, caused by decades of "free market" nuts who opposed all regulation. This will turn and we will have sensible regulation again.
March 18, 2009 7:42 PM | Reply | Permalink
Apparently, and this is politico so source is potentially suspect, Dodd took the mea culpa for #2:
http://news.yahoo.com/s/politico/20090318/pl_politico/30833
The last several headlines for this story here at TPM *have* been very politico-like in their ability to mislead.
Maybe we should all start focusing on Josh's new frame, Cassano's potential (probable) illegal activity.
March 18, 2009 9:06 PM | Reply | Permalink
I actually find this what did he know and when crap, just that crap. Who cares? He said he was trying to get them not to do it and they analyzed it legally. They didn't do that in 24 hours by any means and make a decision. I'm sure that this issue has been going on behind the scenes for months. I recall that he said that he found out about the bonuses on tuesday, found out that they wanted to pay them probably. That's what he found out. He knew about the problem for months I am sure.
March 18, 2009 6:35 PM | Reply | Permalink
I've noticed that too lately.
March 18, 2009 6:38 PM | Reply | Permalink
I'm finding TPM's coverage of this story a bit "Drudge"-like.
Cool your jets folks and be a little more discriminating in what you post, please.
March 18, 2009 6:39 PM | Reply | Permalink
Elana & Co strain at a gnat and swallows a camel
Recover $165 million from AIG?
AIG can't even repay the loans it already has taken out. McClatchy reported this from a GAO report hours ago!
http://www.mcclatchydc.com/227/story/64311.html
Who gives a rat's ass whether Treasury knew of something it could do nothing about on February 28th or March 12th?
My God..no wonder this country's so screwed up
Nixon?
RU drunk?
March 18, 2009 7:17 PM | Reply | Permalink
amen
March 18, 2009 7:17 PM | Reply | Permalink
Good comment. A man's attitude goes some ways in his life will be.
March 19, 2009 5:47 AM | Reply | Permalink
Elana, with all due respect you just peddled some nefarious shit. If you added that paragraph that forsythe just did the context would be Geithner ISN'T lying about his knowledge of the incident.
March 18, 2009 6:42 PM | Reply | Permalink
You should be freaking ashamed of yourself for that fox-like framing.
March 18, 2009 6:44 PM | Reply | Permalink
Yes Elana, just like when your fellow MSM hacks basically convicted Obama for his "involvement" in the Blago scandal.
This is a good example of how TPM has gone to the gutter since Greg left.
March 18, 2009 7:06 PM | Reply | Permalink
I don't know about gutter, but I do think TPM was better as a source for campaign journalism.
March 18, 2009 7:15 PM | Reply | Permalink
We need more Eric less Elana
March 18, 2009 7:26 PM | Reply | Permalink
Some of us are old enough to remember the days -- oh, about six months ago -- when the OFB faction at TPM was doing nothing but excoriating Eric for reporting on poll results that weren't favorable to Obama.
How quickly times change, and how short some memories are.
March 18, 2009 9:16 PM | Reply | Permalink
Hey, I think Eric's still pretty f'n awful aside from his reporting on Franken, but now that you bring it up... yes, looks like the election results completely validated those of us who were critical of his often misleading and sensationalistic reporting on shoddy polls. Thanks for pointing that out!
March 18, 2009 9:47 PM | Reply | Permalink
Ah, another logical tour de force.
Item: During campaign, Kleefeld reports on poll numbers. Those numbers do not show a uniform triumphant uptrend for then-Senator Obama.
Item: A faction in the TPM commentariat froths at mouth and gnashes teeth, excoriating Kleefeld, whenever the aforementioned posts do not show the aforementioned triumphant uptrend.
Item: Senator Obama eventually wins election.
Conclusion (apparently): See! Kleefeld should never have reported on those poll numbers! Cause, y'know, Obama eventually won! We're Vindicated!
Like I said, a true logical tour de force.
It might have helped you if you could have pointed to some Kleefeld posts that concluded something along the lines of "zOMG Obama's Gonna LOSE1111!1". Then you might have an argument. Without that, though, you ain't got a whole lot of "validation" to run with, bub.
March 20, 2009 3:21 AM | Reply | Permalink
I've been hanging out here at TPM for a long time, now, since well before the primaries. I don't claim that that gives me some proprietary interest or some greater right to make editorial criticisms. It's Josh's site and he can do whatever he wants with it. But I have to say that in all the time I've been here, through three commenting systems and two complete cycles of "regulars," I have never, not once, seen a comment thread as one-sidedly negative about the main post as this one.
My sense of TPM has always been that it is kind of an answer to the unhinged, fact-free, Dowdified, Drudgified continuious feeding frenzy that passed for MSM reportage in the Clinton years. It has never been shy about taking on the MSM mindset. I was particularly impressed with the way Josh has willingly taken on both Politico and Halperin for flagrant asshattery, even at times when links to TPM from those sites seemed to be on the rise. It did not go unnoticed by me that links to TPM from both sites, and, in particular Halperin's site, dropped precipitiously after he did that. I admired that kind of integrity and fearlessness.
I also don't want to descend into concern trolling. I'm perfectly well aware that there are plenty of readers here who are totally on the "Hang 'Em High" bandwagon who are just thrilled with this story line and that their viewpoint is as valid as mine. I am, additionally, aware of the extent to which my own consistent Kool-Aid drinking defender of Obama outlook is probably influencing my own perspective on this.
Stll, this post is the culmination of several consecutive days when the AIG bonus story has completely dominated TPM's coverage both on the front page and in TPMDC. It is clear that the story has tapped into Josh's growing genuine outrage over the AIG bailout, and the TARP and Fed actions, and that that outrage is genuinely shared by others both at TPM and in the broader community. He's not just pumping the story for clicks like Drudge or hyping it for ratings like cable.
However, the thrust of the thread is that the main post omits a critically important part of the report that is the subject of the post and that it does so apparently to support a breathless, snarky, "scandal" narrative that the omission would expose as not only unsuppported by the facts but actually contrary to the facts.
I think this represesnts a serious overstepping of the boundaries of journalistic propriety.
I also think the comment thread to this post, where even the people in the comment community who are fully and most visably onboard the AIG outrage train are conspiciously declining to defend it--identifies the shark-jumping moment for this story.
I would respectfully suggest that maybe it means it is time to step back, take a breath and get some perspective on the relative importantance of this story in the grand scheme of things. (Admittedly, "perspective" has been one of my favorite words of late.) I also think it would be a good idea to consider the extent to which TPM is in itself, at some level, using the MSM feedback loop excuse--"we have to cover this ad nauseum because people are outraged" when, in fact, the tone of the reporting is generating and perpetuating the outrage.
I've never written a post quite like this before. It feels rude, like a houseguest offering critiques of the food and the decor at his host's house. But this thing is beginning to take on the same overtones of bewildering witch hunt hysteria that Whitewater had for me and I can't let it pass without notice.
March 19, 2009 9:22 AM | Reply | Permalink
And, oops, this is totally OT to the comment it purportedly replies to. My bad. I didn't mean to post it as a reply to anyone.
March 19, 2009 9:26 AM | Reply | Permalink
I think you right when you say "in fact, the tone of the reporting is generating and perpetuating the outrage". At the President's town hall meeting yesterday, none of the questions, iirc, were about AIG.
March 19, 2009 12:32 PM | Reply | Permalink
AS Warren Buffet has said, "We are in a an economic war." While the MSM fiddles, history is being made:
"Bloomberg: U.S. stocks and Treasuries surged and the dollar tumbled after the Federal Reserve unexpectedly announced plans to buy $1 trillion of bonds in an effort to lower consumer borrowing costs and end the recession. "
And people are talking about AIG Bonuses!
The Federal Reserve led by Bernanke and the Obama administration together are unstoppable. I am increasingly optimistic (and I have lost my job) - the government will defeat the near depression. Its happening now.
March 18, 2009 7:16 PM | Reply | Permalink
But the dollar tumbled, that isn't good news at all.
March 18, 2009 9:34 PM | Reply | Permalink
Actually, it is good for the economy that the dollar dropped in value. It's better for trade and the global economy.
It's already having a positive impact on the global markets.
March 19, 2009 7:51 AM | Reply | Permalink
TPM has developed a mass case of Obsessive Compulsive Disorder
March 18, 2009 7:20 PM | Reply | Permalink
It's time for Geithner to go.
He has been Paulson II and I think Volcker, who has balls of steel, would make a much better Secretary of the Treasury.
March 18, 2009 7:22 PM | Reply | Permalink
Ridiculous
March 18, 2009 7:24 PM | Reply | Permalink
If Obama fired Geithner after a month on the toughest job in the administration, he would not only be an asshole, he would be painting a big target on his back which says: I'm a wuss who is ruled by fake outrage.
And the next time someone in his cabinet was on the hot seat (even if they didn't do anything wrong), the Repugs would be calling for his head, too.
Geithner is in a difficult situation. He is trying to deal with this mess, hire a team while being pilloried by a bunch of folks who wouldn't know a derrivative from a diaper!
March 18, 2009 7:50 PM | Reply | Permalink
That's absolutely absurd. Although they did not cause the problem, Obama and thus Geithner are accepting responsibility to fix it. Something you would have never seen under Shrub's administration. They never knew the word "responsibility" or "accountability".
March 18, 2009 7:58 PM | Reply | Permalink
On HuffPo I just learned that Limbaugh thinks the AIG bonus flap is a big Obama conspiracy
Next I suppose we should expect furious and frenetic activity TPM World Headquarters tracking down the "latest"
But the GAO report on AIG ....you won't find it here
March 18, 2009 7:23 PM | Reply | Permalink
Get with the program. Stuff is happening. Obama will circle back later to address the miscreants at AIG.
AS Warren Buffet has said, "We are in a an economic war." While the MSM fiddles, history is being made:
"Bloomberg: U.S. stocks and Treasuries surged and the dollar tumbled after the Federal Reserve unexpectedly announced plans to buy $1 trillion of bonds in an effort to lower consumer borrowing costs and end the recession. "
And people are talking about AIG Bonuses!
The Federal Reserve led by Bernanke and the Obama administration together are unstoppable. I am increasingly optimistic (and I have lost my job) - the government will defeat the near depression. Its happening now.
March 18, 2009 7:26 PM | Reply | Permalink
Like I said yesterday: Elena, you belong on Cable News, specifically Faux. You do a good job but your penchant for "gotcha" journalism and turning everything into the next Watergate is getting old.
Looks like you spend your day calling people in Congress to get them to react to some bit of gossip. Can we get more news and less political spin back-and-forth?
March 18, 2009 7:44 PM | Reply | Permalink
Yep.
Also, since the MSM is so "outraged," where are their calls for levying taxes on bonuses?
March 18, 2009 7:59 PM | Reply | Permalink
And yeah, I'd like more news from TPM, and less of this recent trend of "reporting" on the latest Republican talking points. I couldn't care less what today's RCCC e-mail said.
March 18, 2009 8:00 PM | Reply | Permalink
This does not look good for Geithner but I agree. It could have been handled differently.
March 18, 2009 10:44 PM | Reply | Permalink
It's time to figure out the purposes of keeping AIG (and some other financial institutions) fake private companies, since both Paulson and Geithner have insisted this is necessary, but without any plausible reason. And by "purpose" it means something that can be done only as a fake private company that couldn't be done as one in bankruptcy or federal receivership (like Fannie Mae, which still makes loans, tries to clean up its mess, etc.). So what are the purposes of the Treasury Secretaries keeping AIG in some sort of pseudo-life? First, and this seems to be one suggested by the Secretaries, they can retain the jackass leaders' high morale by feeding them tons of taxpayer dollars to "retain" them, which they couldn't spend so much politically if they were in receivership and not supposedly private operations. And without pseudo-life, they couldn't give them so-called "merit" bonuses based on their performance, since those would be unsecured debts at best. They appear to think that's fine. And they can avoid such problems as the FOIA or disclosures in court filings and try to keep secret the destinations of all that taxpayer money, such as European banks. They can avoid public concerns like that which would arise if a federally controlled entity were giving UBS billions of dollars without even conditioning that gift on UBS's cooperation with the Justice Department in its investigation of UBS's massive encouragement of tax fraud by Americans and helping to regain the billions that UBS's participation and assistance in tax fraud has lost the government. And maybe there's some statutory restriction on simply giving UBS etc. taxpayers' money, so pretending it's a loan to AIG and that AIG is merely preferring a debt AIG has to those counterparties is the only seemingly lawful way to get our money to them. Is that right? And there are lots of little matters, such as AIG lobbying. There must be other purposes; could others help identify them?
March 18, 2009 8:06 PM | Reply | Permalink
Strain at Gnat, Swallow Camel
March 18, 2009 8:24 PM | Reply | Permalink
First off, journalists here need to stop getting sucked into the spin wars. Before people think they've got some priceless piece of information, think first, then hit enter. And please please please stop with the speculations.
I'm about ready to start passing out pitch forks and torches for everyone here so we can storm TMP headquarters.
Second, the person two posts up needs to learn what a paragraph is.
March 18, 2009 8:45 PM | Reply | Permalink
Come On! This is bad. I've been calling the guy a crook all week, so it's not that I like Geithner - but I dislike him for honest reasons.
March 18, 2009 8:47 PM | Reply | Permalink
test, sorry
March 18, 2009 8:49 PM | Reply | Permalink
This is what my buddy in New Orleans would call a "weak sauce" post. What the hell do you think you are doing, auditioning for "All the President's Men Part II"?
Do you honestly think you are hunting down a scoop here? You can try and manufacture drama, but you need a good script to get us interested.
Try something like this: Geithner was up in his tower, mixing toxic asset stew in a cauldron, muttering to himself, "Yes, yes, we will pay the bonuses, yes...," and calling out to his aides, "bring me more babies for the stew, more babies!"
That'll titillate!
March 18, 2009 9:05 PM | Reply | Permalink
Well, I just watched obama's town hall, behind the orange curtain no less in deep dark ruby red republican territory, the OC. It was amazing. He was freaking awesome and the crowd was going nuts. He is getting so good at these townhalls. He totally answers the questions and addresses the problems. No BS. God, was he good. He speaks to the heart and deals with the problems. I just can't believe that we have a president like this. It is utterly amazing and astounding. First time in my life time. I would encourage anyone with a chance to watch it to watch it. I'm sure it will be repeated. Wow, just wow.
March 18, 2009 9:35 PM | Reply | Permalink
Is it online anywhere?
March 18, 2009 9:39 PM | Reply | Permalink
It'll be on C-Span2 at 10:20 EDT.
March 18, 2009 9:42 PM | Reply | Permalink
ty
March 18, 2009 9:43 PM | Reply | Permalink
I watched it on msnbc. Unfortunately I dvr'd it, so I was watching it over an hour after it was done. He was on fire and awesome. Maybe it's on the msnbc website. It was in the 1600 and 7:00 softball time slots.
March 18, 2009 9:42 PM | Reply | Permalink
I have never seen anything like it, a President cheered so loudly. They cheered at policy. They cheered when he took a drink. Anyone who wants a public opinion poll need only peek at this.
When he opened it up to questioning, he just came out and said it: anyone who thinks I'm a bum, and ought to resign today, let's hear it. We didn't hear it. We heard, instead, shouts of love.
His repaid his audience with answers that were meticulous, and clearly they emanate from someone who really wants you to get it. Because you need to get it, because he has to move on to the next thing.
I suddenly feel very sorry for the GOP. They will never have anyone like him in my lifetime. Ok, the first part was a damned lie.
Let the man lead, says I.
Pax,
M.
March 18, 2009 10:22 PM | Reply | Permalink
here's a stupid question: why does it matter WHEN they knew? or is this just some kind of "gotcha" politics?
March 18, 2009 9:50 PM | Reply | Permalink
i ask because it seems there's nothing they could have done about it no matter WHEN they found out...so i don't see how knowing about it two weeks ago really makes a difference...
March 18, 2009 9:55 PM | Reply | Permalink
The media (all forms, and sides) is starving for a scandal. One side is waiting for Obama to mess up - because he's soooo annoyingly perfect at everything. The other half is waiting for signs of how he may be just Bush Lite - you know, "meet the new boss, same as the old boss."
March 18, 2009 11:30 PM | Reply | Permalink
"I know Washington's all in a tizzy, and everybody is pointing fingers at each other, and saying it's their fault, the Democrats' fault, and the Republicans' fault. Listen: I'll take responsibility. I'm the President.
We didn't draft these contracts. We've got a lot on our plate. But it is appropriate when you're in charge to make sure that stuff doesn't happen like this, so we're going to do everything we can to fix it.
So for everybody in Washington who's busy scrambling to try to figure out how to blame somebody else, just go ahead and talk to me, because it's my job to fix these messes even if I don't make them.
But what's just as important is that we make sure we don't find ourselves in this situation again, where taxpayers are on the hook for losses in bad times, and all the wealth that's generated in good times goes to those who are at the very top of the income ladder."
Bravo.
Move on.
March 18, 2009 10:05 PM | Reply | Permalink
I will for the second time today register significant disappointment for the tone of an article presented by TPM.
This is complicated stuff, and there are people like me who want straight reporting on what turns out to be a complex issue, and perhaps the most complex financial and economic issue of my life.
The reporting here has been good, and yes, I understand that this is as much a site devoted to commentary as straight reporting, but the snarky comments embedded in stories and headlines that significantly distort the story by leading me to a conclusion that is not supported by the rest of the reporting is becoming more than a little infuriating.
The "Nixon-style" comment and the rest is a serious deviation from what I had come to expect from this site. If Elana
March 18, 2009 10:13 PM | Reply | Permalink
Sorry. To continue the thought:
If Elana wants to make political commentary, fine, do it in one of those video pieces, like when she gave her thoughts on how cool it was to see P-Diddy and whoever exchanging high fives. And it is clear she can also do excellent straight reporting, like with the Feinstein coverage on the Panetta blowup.
But when she mixes her commentary and reporting in a way that lessens both, I have to wonder who is doing the editing, and exactly how much the DC unit of TPM is run independently of editorial oversight by New York.
I expect much better from this site.
March 18, 2009 10:17 PM | Reply | Permalink
Elana, Lars is offering you a teachable moment.
In these times, it is imperative you don't blow it.
Pax,
M.
March 18, 2009 10:26 PM | Reply | Permalink
Bravo.
March 18, 2009 11:21 PM | Reply | Permalink
NY Times and WaPo both said Geithner didn't know until Tuesday. This column should be updated to add that fact.
March 19, 2009 1:24 AM | Reply | Permalink
I must say i do love how the commenter's on this site call out bad post when they see them.
March 19, 2009 2:29 AM | Reply | Permalink
BREAKING! Politics Involved in AIG Scandal!
Jebus!
Thankfully, I was busy all day yesterday and missed the feeding frenzy! But after my morning cuppa and reading about all that went on, as well as watching the prez in OC vids, I have to shake my head at how this inanity saturated the MSM and progressive blogs.
I can't believe the "impending doom for Timmeh" chorus and outright calls for Geithner's resignation. I'm no big Geithner fan, he's a little too shellshocked for my taste, but what human being wouldn't be in the wake of the Bush disaster, so I can step back and avoid being sucked into all of the microcriticism surrounding him.
Let's keep our heads, shall we, and step back for a min to look at the larger picture and thank you TPM commenters for being among the only sources of sanity out there right now! In the light of the overall financial crisis, this "whodunnit" is trivial bullshit and for Obama to shitcan or have his Treasury Sec'y resign, well that would be perfect, now wouldn't it? It's exactly what the country needs!
Yes, Obama and Geithner are in cahoots to sell the country to the ginormous all powerful corporate elites who control the world! Or, worse! Geithner is using the hapless Obama to raid the Treasury disappear and rendezvous later with his pals Bernake, Paulson, Bush and Cheney for boat drinks on Treasure Island! SCOOP!
I'm all for transparency but I draw the line at an Obama Administration Reality Show complete with bad music, "intrepid" reporter solo confessionals and gobs of manufactured drama!
Please make it stop!
March 19, 2009 6:44 AM | Reply | Permalink
This is about the painful frustrations many of us are going through and the need to get the satisfaction of watching someone hang from the tree.
I thought the WashPost put this whole "who knew what when" in its proper perspective this morning:
When Geithner was involved with Paulson back in September meeting with AIG to find out about their pending collapse, "his primary concern was keeping the financial system from collapsing, not what firms were paying their employees."
Nothing has changed, we're still not out of the woods with AIG and this focus on these excessive bonuses could still bring them down and us. Yes, he under estimated the "PR" factor but I want him focused on getting AIG to rid itself of their derivative inventory so we can sell some very profitable subsidiary companies they own.
Let's get real. This "inside the beltway" game being perpetuated by the media could be our undoing.
March 19, 2009 8:25 AM | Reply | Permalink
This is all such a crock. On Jan 28th Bloomberg ran the story "AIG Said to Offer $1 Billion in Retention to Workers"
Where was the public outrage then. Why has MSM decided to stir the pot now instead of back in Jan.
If AIG goes under the current outrage is going to look like a pimple on an elephant.
Michael Hirsh write in Newsweek
"the implications" (of AIG going under) "are almost too awful to contemplate. Despite its troubles on Wall Street, AIG is still the largest insurance company in the United States, controlling both the largest life and health insurer and the second-largest property and casualty insurer. It has 30 million U.S. customers. AIG is also a major provider of guaranteed investment contracts and products that protect people in 401(k) plans, as well as being the leading commercial insurer in the U.S. It is one of the largest insurance companies in the world, with insurance and financial operations in more than 130 countries."
AIG's failure would not be outrageous, it be catastrophic.
March 19, 2009 9:16 AM | Reply | Permalink
AIG going under would not be outrageous or catastrophic. It's just freaking insurance for pete's sake. Insurance is a rip-off and a con game. There is no asset there. It is just paper pushing paper to get people to give them money to buy something that they really don't get in return.
It's kind of ironic when you think about it. Average joe the plumber buys insurance thinking that he is "covered" and then he goes to make a claim after paying for insurance for years and the carrier says fu. Sue me. We're not paying. This happens all the time. Now, what happened to cause the melt down? Financial companies buy insurance thinking that they are covered. They go to make a claim and aig says fu we're not paying. Sue me. Companies start going under. Unfortunately, the us government steps in to make the payments under the policies. They never do that for joe the plumber.
Insurance companies are so 19th century. They should go the way of the dinosaur.
March 19, 2009 9:24 AM | Reply | Permalink
Sorry Michael A but you are wrong. Where you just trying to throw a line and hook in the water to see what happens.......?
Anyway, as JTS outlines in his post, AIG's demise would be catastrophic. Go do some learning unless all you're engaging in is anonymous bantering.
March 19, 2009 9:38 AM | Reply | Permalink
How many insurance companies have you had the pleasure of dealing with and learned their internal workings? How many lawsuits over insurance policies and insurance bad faith have you been involved in?
Basically, what the government is doing with aig is using it as a pass through to pay money to aig policy holders on claims, while paying aig employees exhorbitant sums to shovel that money. The money the government is paying is being passed through to entities like goldman sachs. Why not pay directly? Why not negotiate with the entities to see what they really need to pay to keep them afloat and share the losses as opposed to just paying 100 cents on the dollar concerning claims so that the policy holders can make profits? If the government didn't step in they would have had to absorb 100% of the loss.
Why don't you go do some learning.
March 19, 2009 9:50 AM | Reply | Permalink
It sounds like you despise insurance companies as much as I do and for the same reasons. In the kind of cases you mention for the average Joe, the insurance company HAS the ASSETS to pay you - they're just nickle and diming you on every word, comma and period of the policy or refusing out of greed. But suprisingly, insurance companies do pay out as they should, and fairly regularly. So what happens when they DON'T have the ASSETS to pay you. In AIG's case it would mean that 30 millon Americans would get screwed. And this isn't just having to pay for the body work on your car kind of screwed. This is your 401k, your house, your health and a lot more. So it's not just paper.
March 19, 2009 9:58 AM | Reply | Permalink
Ok, I'm just pissed about the whole situation and the fact that it appears that aig was propped up to prop up goldman sachs. I still think that on the derrivative swap crap they should be playing hardball on payouts. AIG is beyond bankrupt. It is basically a private company acting as a holding company for hundreds of billions of taxpayer dollars. I know one of the reasons they are doing what they are doing is waiting for the policies to expire, but still. Also, I am aware that many divisions of aig were profitable, so they want to spin them off.
I guess, bottom line, a claim comes in, negotiate. 50 cents on the dollar, or something. Why should the us taxpayer absorb 100 percent of the loss concerning companies that were responsible for this catastrophe? It's not logical.
I guess the issue is regulation long term like obama says. Short term we have to shovel, long term we have to regulate. The conduct of the financial industry, including insurance carriers, has been un-freaking-believable. If I would have known 1/10th of what I know now, I would not have been wiped out financially. I am wiped out and they are paying millions of dollars in bonuses to people that caused the wipe out? Give me a freaking break. Throw some money my way.
March 19, 2009 10:07 AM | Reply | Permalink
Hello All:
Thank you to all who have commented on the "gotcha" nature of this post. There are other examples, for example the TPM headline that emphasizes "trillion," in an echoe of WSJ's editorial perspective on just about anything the Admministration does (w/no consideration of WSJ's point-of-view).
TPM is usually better than this, but occasionally does lapse into the hysteria-of-the-moment mode. That's too bad.
Another unquestioned posting: "Obama takes on AIG anger at townhall meeting." (Reuters) I watched the thing - twice. The meeting was much more substantial than the story suggests. There were well-informed questions about teacher lay-offs in CA, states that won't take the stimulus money, a worker laid off from Toyota heartbreakingly wondered when things were going to get better, a head of a construction union had a question...
It was just remarkable.
In response to Kurtz, the upside of suggesting that people are not consumed by AIG bonuses?
It may actually be true...
March 19, 2009 10:33 AM | Reply | Permalink
Thank you to the commenters at TPM who are keeping their heads through all this. The media and the politicians, and yes TPM, have really jumped the shark on this AIG story. They seem to want to lead the country into mass hysteria. How responsible!
And as for ANYBODY in Obama's cabinet being characterized as "nixonian" less than two months in office, Elana I think Politico is the right place for you. They have a nice swing for you to jump on.
March 19, 2009 12:28 PM | Reply | Permalink
Where is the outrage over what AIG and other bailout companies and what they are doing in the first place?
These are written contracts these companies made with employees -- the government cannot force a company to break the law and ignore a contract.
As for when somebody knew about them and when they didn't -- because of the above facts it doesn't make any difference.
Besides, Obama's people are looking at more than just ONE company's actions and one nations's actions, they are working with a short staff and they are working on a massive undertaking across the spectrum -- and yet you want them to find needles in a haystack?
March 19, 2009 1:33 PM | Reply | Permalink
I've been against Geithner since he was nominated for the position. He's too close to Wall Street and signing off on these bonuses (if that's what he did) may be a reflection of that. But to suggest that he's committed a some sort of crime that needs to be thoroughly investigated, because he allowed bonuses that were already agreed upon by contract before he ever took office, is ludicrous. His only crime is being inexperienced, understaffed, and politically obtuse.
This AIG bonus fiasco is being 'ginned up' in Washington by the right wing echo chamber because they see it as an opportunity to hurt Obama and to derail what he's trying to do. It's largely a reflection of their powerlessness and political desperation.
Most people aren't surprised in the least by AIG's arrogance - they already know how greedy corporations operate and they don't expect Obama to have changed everything in two months. If anything, it only adds to the argument that there needs to be drastic change in regulations and in how corporations operate. That's why Obama is playing political rope-a-dope and pointing out that this is only one symptom of a much broader and deeper problem that needs to be fixed.
March 19, 2009 1:48 PM | Reply | Permalink