Taxpayers had more than enough reasons to be mad about the AIG debacle before the bailed out insurance giant paid millions of dollars in “retention” bonuses to current and former executives — including the suits whose decisions imploded the company and the overall economy.
But the voting public should reserve its deepest rage for the very people leading the torch-and-pitchfork brigade: the shameless, phony Washington Democrats who only months ago considered AIG their BFF.
AIG has long been one of the country’s biggest campaign contributors. AIG’s $9.3 million in payouts since 1989 place the company on OpenSecrets.org’s “Heavy Hitters” list, which tracks Washington’s 100 most prolific donors. Prior to the 2008 election cycle, that money was evenly distributed between the two major parties.
But last year, AIG paid close attention to the polls and bet big on Democrats, giving them about 70 percent of its contributions. And the two people AIG singled out for its greatest financial support were Barack Obama and Sen. Chris Dodd, D-Conn., chairman of the upper chamber’s banking committee. The two split about $204,000 in contributions. AIG also spent more than $21 million lobbying the Democratic Congress from 2007 to 2008.
What does that kind of commitment buy? President Obama’s $787 billion stimulus bill included an amendment that limits executive compensation, but provides an exemption for contractually promised bonuses agreed on before Feb. 11, 2009 — an exemption that could not have been better crafted to benefit AIG executives. That amendment was submitted by Sen. Dodd.
Yet President Obama and Sen. Dodd, who championed the “stimulus” boondoggle, would have the public believe these bonuses were a complete and horrifying surprise to them.
On Tuesday, Sen. Dodd took a break from decrying the AIG payouts to make the extraordinary claim that he does not know how the exemption made it into his amendment or who was responsible for it. Meanwhile, White House officials said Tuesday that the president did not learn of the bonuses until Thursday, the day before AIG issued $165 million in rewards. Evidently, neither President Obama nor Sen. Dodd took the time to read their own bill.
Now they’re willing to consider an unconstitutional, targeted tax on those bonuses to undo their purported legislative oversight. But they’ll keep their hundreds of thousands of dollars in contributions from AIG, thank you very much.
This is not a campaign finance problem. This is not a lobbying problem. This is a problem of expedient politicians trying to have it both ways by serving the interests of campaign donors and lobbyists and then pretending they’re righteous when the whole thing explodes in a fireball of public outrage.
For all the money it has spent on elections and government affairs, AIG has demonstrated exceedingly poor political instincts. Its chief executive officer, Edward Liddy, threw himself before a House Financial Services panel Wednesday to beg forgiveness for the company’s foolish and “distasteful” mistakes. Perhaps now, the company realizes that taking $170 billion in taxpayer money — and giving the federal government an 80 percent stake — warrants intensified oversight.
If only President Obama, Sen. Dodd and everyone else who took AIG’s money were held to the same standard.