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On the floor of the Senate today, Senator John Cornyn (R-TX), Chair of the National Republican Senatorial Committee, blasted President Obama and the Treasury for the mess it finds itself in over the revelation that taxpayer dollars will be used to pay “bailout bonuses” to AIG. Click here or below to watch.
Here’s the transcript:
“Mr. President, we’ve all heard about the ‘Bailout Bonuses’ that have been paid to top managers at AIG. This company has received $173 billion of taxpayer money – including tens of billions through the Troubled Asset Relief Program – and the American people deserve to know where their money is going.
“I confess I supported the first round of TARP money last year. But I didn’t support any additional money for TARP because the accountability and transparency we were promised by the Treasury Department never materialized. We were told this money was necessary to avoid a crisis. Now we do have a crisis – a crisis of confidence in this Administration and the leaders of Congress.
“The American people have legitimate and urgent questions about these Bailout Bonuses. And these questions demand answers. How did this happen?
“Lots of people are pointing fingers over these Bailout Bonuses, but right now there’s a lot we don’t know. We don’t know when the Administration became aware of these bonuses.
“Secretary Geithner says he learned of the bonuses last Tuesday. President Obama says he learned about them on Thursday. Yet the Federal Reserve Bank of New York says they notified Treasury in February. And Edward Liddy, the CEO of AIG, testified that everybody knew about these bonuses for months – and that he and Secretary Geithner spoke about the Bailout Bonuses two weeks ago.
“What’s clear is that the Administration should have known about these Bailout Bonuses a lot earlier. And they should have taken action before they sent AIG another $30 billion earlier this month. We also don’t know how these Bailout Bonuses got legal protection in the stimulus bill.
“Mr. President, I voted against the stimulus bill – for reasons too numerous to mention. Yet the bill that passed out of this chamber had two amendments in it that addressed Bailout Bonuses. One amendment was sponsored by Senators Snowe and Wyden. It would have taxed these bonuses. Another was sponsored by Senator Dodd. It would have banned Bailout Bonuses altogether.
“These amendments were in the bill passed out of the Senate. But then something happened in conference. The Snowe/Wyden amendment disappeared completely. And the Dodd amendment was changed so that it grandfathered in all the Bailout Bonuses in place on or before February 11.
“And no one seems to know how this happened. None of the conferees seem to know. And there have been conflicting reports about who knew what when.
“The American people deserve to know who protected these Bailout Bonuses in law. They deserve to know who proposed these changes in the stimulus bill, who knew about these changes, and who approved these changes.
“The American people deserve to know who is responsible – and how they intend to fix this problem and get the Bailout Bonus money back. How do we ensure this doesn’t happen again?
“Mr. President, as those responsible scramble to fix this problem, we must also understand what we must do to ensure this type of thing doesn’t happen again. I’d like to offer a few suggestions.
“First, Congress needs to stop passing bills without giving everybody enough time to read them, find out what they do, and prepare for their implementation. During the transition, the incoming Administration said that they didn’t want to ‘waste’ this crisis. And Congress complied. Yet their leadership has taught us a different lesson: treating everything like a crisis leads to a lot of waste.
“Second, the Administration needs to get its team in place. Better oversight by the Treasury Department could also have avoided this problem of Bailout Bonuses.
“Yet as Paul Volcker observed, Secretary Geithner ‘is sitting there without a deputy, without any undersecretaries, with no assistant secretaries responsible in substantive areas at a time of obviously very severe crisis.’
“I appreciate that President Obama has completed his ‘March Madness’ Tournament Bracket. Yet the organizational chart of his Administration still has far too many open slots.
“Third, the President needs to shelve his plans to grow government. His plans to raise more taxes can wait until his Administration proves they can be good stewards of the tax dollars we are already spending.
“His plans to nationalize control of health care, energy, and education can also wait – until he addresses the problem of toxic assets in our financial system – and gets our economy moving again.
“Fourth, the President needs to fulfill his pledge to promote transparency, accountability, and bipartisanship in Washington. The President won the support of the American people because he promised to be a different kind of leader. Yet we see that the more things ‘change,’ the more they stay the same.
“Lack of transparency in Congress helped protect these Bailout Bonuses in law. Lack of accountability at the other end of Pennsylvania Avenue speeded this money out the door.
“And if the President’s efforts at bipartisanship had been substantive – more than a photo op and a press release – then we might have delivered a better stimulus bill – and not squandered the trust of the American people.”
No matter where you stand on whether or not the bonuses should be paid out, Cornyn is absolutely right. Someone (or some people) in the administration and in the Dem leadership specifically requested that protections for the bonuses be placed into the stimulus bill, and for the administration and leaders in the Democrat party to be engaging in the “who can show the most outrage” game is nothing more than phony posturing and slick attempts at a**-covering.
Who would have thought that within the first two months of Obama’s administration he’d be having his first “What Did He Know And When Did He Know It?” moment? The American people deserve answers, and they’re not getting them from the people they put in firm control of both Congressional houses and the WH. Instead they’re being treated to “solutions” that will only make matters worse down the road, and an administration that has given a whole knew meaning to the phrase “dodge and weave.”
One other thing: Think this has been a wake up call for all the liberal and moderate conservative elites across the country who strongly implied throughout the year last year that Obama would have the smartest team ever assembled in Washington by his side to help him “manage” the enormous challenges that were up ahead? Don’t hold your breath.