AIG chiefs pressed to donate to Dodd

EXCLUSIVE: AIG chiefs pressed to donate to Dodd

EXCLUSIVE:

As Democrats prepared to take control of Congress after the 2006 elections, a top boss at the insurance giant American International Group Inc. told colleagues that Sen. Christopher J. Dodd was seeking re-election donations and he implored company executives and their spouses to give.

The message in the Nov. 17, 2006, e-mail from Joseph Cassano, AIG Financial Products chief executive, was unmistakable: Mr. Dodd was “next in line” to be chairman of the Senate Banking, Housing and Urban Affairs Committee, which oversees the insurance industry, and he would “have the opportunity to set the committee’s agenda on issues critical to the financial services industry.

“Given his seniority in the Senate, he will also play a key role in the Democratic Majority’s leadership,” Mr. Cassano wrote in the message, obtained by The Washington Times.

 

Mr. Dodd’s campaign quickly hit pay dirt, collecting more than $160,000 from employees and their spouses at the AIG Financial Products division (AIG-FP) in Wilton, Conn., in the days before he took over as the committee chairman in January 2007. Months later, the senator transferred the donations to jump-start his 2008 presidential bid, which later failed.

Now, two years later, Mr. Dodd has emerged as a central figure in the government’s decision to let executives at the now-failing AIG collect more than $218 million in bonuses, according to the Connecticut attorney general – even as the company was receiving billions of dollars in assistance from the Troubled Asset Relief Program (TARP). He acknowledged that he slipped a provision into legislation in February that authorized the bonuses, but said the Treasury Department asked him to do it.

The decision has generated national outrage and put the Obama administration into the position of trying to collect the bonuses after they were distributed. It also endangers Mr. Dodd’s re-election chances in 2010 as his popularity tumbles in his home state.

Despite all the claims that Washington has changed, the tale of Mr. Dodd’s lucrative political ties to AIG is a fresh reminder that special interests continue to use donations and fundraising to sow good will with powerful lawmakers like Mr. Dodd.

“The message seems clear: The boss says I want you to support the senator,” said Sheila Krumholz, executive director of the nonpartisan Center for Responsive Politics, which studies political fundraising and ethics. “And I think the employees got the message.”

Representatives for Mr. Dodd did not answer specific questions about AIG’s fundraising, but spokesman Bryan DeAngelis said in a statement: “Senator Dodd´s fundraising has always been above board, transparent and in accordance with campaign finance rules.

“As he said [earlier this month], contributions received from any individual who accepted these bonuses from AIG last week will be donated to charity. And last fall, he made the decision to no longer accept contributions from [political action committees] of companies receiving TARP money.”

Officials at AIG-FP in Wilton referred inquiries to the firm’s New York headquarters, where spokesman Mark Herr said he had been on the job only three weeks and had no information about the e-mail or the campaign contributions to Mr. Dodd.

Mr. Cassano’s Washington attorney, F. Joseph Warin, did not return messages left on his voice mail or e-mail.

Mr. Dodd’s plight also signals that the actions taken by lawmakers after they receive big political donations are being scrutinized by an increasingly distrustful public. A recent Quinnipiac University poll found Mr. Dodd lagging 43 percent to 42 percent behind former U.S. Rep. Rob Simmons, a Republican who plans to challenge Mr. Dodd, in a hypothetical race.

“The concern and the question is whether AIG was purchasing kid-glove treatment from their home state senator – from the senator chairing the committee charged with overseeing their industry,” Ms. Krumholz said.

Political opponents already are using Mr. Dodd’s financial ties to AIG and his role in the bonuses to weaken his political standing heading into re-election.

AIG’s employees have been big financial backers of Mr. Dodd. Over his career, Mr. Dodd has collected $238,418 from AIG employees and their spouses, according to the Center for Responsive Politics. Mr. Cassano has donated $7,118 to Mr. Dodd’s campaigns.

Mr. Cassano’s November 2006 e-mail instructed his colleagues on how to make donations to the senator from Connecticut.

“As he considers running for president in 2008, Senator Dodd has asked us for our support with his reelection campaign and we have offered to be supportive,” Mr. Cassano wrote.

The employees were told, “If you agree,” to write checks for $2,100 from themselves and their spouses and to send them to Mr. Dodd’s campaign within four days. They also were to ask the senior members of their management teams to do the same and send copies of their checks to the company.

The Dodd campaign collected $162,100 from AIG-FP employees and their spouses within six weeks of the e-mail, according to data from the Center for Responsive Politics and the Federal Election Commission.

Each of the seven AIG-FP executives to whom the Cassano e-mail was sent made two $2,100 contributions to the Dodd campaign – one for the primary and another for the general election campaign. The records also show that five of their wives also contributed $4,200 each to the Dodd campaign. The executive vice presidents are Alan Frost, David Ackert, Douglas L. Poling, Jake DeSantis, Jon Liebergall, Robert Leary and William Kolbert.

Mr. Cassano, who resigned in February after AIG-FP posted losses of $11 billion, followed his own advice. He and his wife gave Mr. Dodd’s campaign $4,200 each.

Political fundraising in the workplace is legal, but a request from a boss may be viewed as a requirement, campaign watchdogs said.

“Implicit in this [e-mail] is the presumption that, at best, noncompliance will not be looked up favorably … at worst, it may have negative consequences on the employees,” Ms. Krumholz said.

Mr. Dodd’s campaign paid for events at AIG, as well. His Senate campaign recorded paying $400 at AIG Food Services on Dec. 7, 2006, about two weeks after the e-mail was sent. In March 2007, his presidential campaign paid AIG-FP $250 for a room rental fee, according to election commission filings. The payments could have been recorded weeks after the events took place.

Watchdog groups say Mr. Dodd’s close association with AIG – over his career, the company’s employees have been one of his largest donor bases – raises questions about his and his committee’s ability to provide objective oversight. It was the $218 million in bonuses paid by AIG that became the focus of public outrage, igniting a torrent of criticism and congressional hearings in the wake of federal loan packages.

Earlier this month, Mr. Dodd defended the amendment to an economic stimulus bill that exempted bonuses to which companies receiving federal bailout funds previously agreed. He initially denied having any role in crafting the language, but he later said Treasury Department officials pressured him to make the change to protect the government from lawsuits.

Although the AIG-FP headquarters is located in Mr. Dodd’s home state and a good number of the bonuses authorized for top company executives went to that office, Mr. Dodd has said he had no idea the amendment would impact the company.

“Let me be clear: I was completely unaware of these AIG bonuses until I learned of them last week,” he told CNN last week. “I agreed reluctantly. I was changing the amendment because others were insistent.”

Beyond AIG: A Bill to let Big Government Set Your Salary

Politics

Beyond AIG: A Bill to let Big Government Set Your Salary

By Byron York
Chief Political Correspondent 3/31/09

It was nearly two weeks ago that the House of Representatives, acting in a near-frenzy after the disclosure of bonuses paid to executives of AIG, passed a bill that would impose a 90 percent retroactive tax on those bonuses. Despite the overwhelming 328-93 vote, support for the measure began to collapse almost immediately. Within days, the Obama White House backed away from it, as did the Senate Democratic leadership. The bill stalled, and the populist storm that spawned it seemed to pass.

But now, in a little-noticed move, the House Financial Services Committee, led by chairman Barney Frank, has approved a measure that would, in some key ways, go beyond the most draconian features of the original AIG bill. The new legislation, the “Pay for Performance Act of 2009,” would impose government controls on the pay of all employees — not just top executives — of companies that have received a capital investment from the U.S. government. It would, like the tax measure, be retroactive, changing the terms of compensation agreements already in place. And it would give Treasury Secretary Timothy Geithner extraordinary power to determine the pay of thousands of employees of American companies.

The purpose of the legislation is to “prohibit unreasonable and excessive compensation and compensation not based on performance standards,” according to the bill’s language. That includes regular pay, bonuses — everything — paid to employees of companies in whom the government has a capital stake, including those that have received funds through the Troubled Assets Relief Program, or TARP, as well as Fannie Mae and Freddie Mac.

The measure is not limited just to those firms that received the largest sums of money, or just to the top 25 or 50 executives of those companies. It applies to all employees of all companies involved, for as long as the government is invested. And it would not only apply going forward, but also retroactively to existing contracts and pay arrangements of institutions that have already received funds.

In addition, the bill gives Geithner the authority to decide what pay is “unreasonable” or “excessive.” And it directs the Treasury Department to come up with a method to evaluate “the performance of the individual executive or employee to whom the payment relates.”

The bill passed the Financial Services Committee last week, 38 to 22, on a nearly party-line vote. (All Democrats voted for it, and all Republicans, with the exception of Reps. Ed Royce of California and Walter Jones of North Carolina, voted against it.)

The legislation is expected to come before the full House for a vote this week, and, just like the AIG bill, its scope and retroactivity trouble a number of Republicans. “It’s just a bad reaction to what has been going on with AIG,” Rep. Scott Garrett of New Jersey, a committee member, told me. Garrett is particularly concerned with the new powers that would be given to the Treasury Secretary, who just last week proposed giving the government extensive new regulatory authority. “This is a growing concern, that the powers of the Treasury in this area, along with what Geithner was looking for last week, are mind boggling,” Garrett said.

Rep. Alan Grayson, the Florida Democrat who wrote the bill, told me its basic message is “you should not get rich off public money, and you should not get rich off of abject failure.” Grayson expects the bill to pass the House, and as we talked, he framed the issue in a way to suggest that virtuous lawmakers will vote for it, while corrupt lawmakers will vote against it.

“This bill will show which Republicans are so much on the take from the financial services industry that they’re willing to actually bless compensation that has no bearing on performance and is excessive and unreasonable,” Grayson said. “We’ll find out who are the people who understand that the public’s money needs to be protected, and who are the people who simply want to suck up to their patrons on Wall Street.”

After the AIG bonus tax bill was passed, some members of the House privately expressed regret for having supported it and were quietly relieved when the White House and Senate leadership sent it to an unceremonious death. But populist rage did not die with it, and now the House is preparing to do it all again.

Byron York, The Examiner’s chief political correspondent, can be contacted at byork@washingtonexaminer.com. His column appears Tuesday and Friday, and his stories and blog posts can be read daily at ExaminerPolitics.com.

 
 
 

Breitbart: The war against online Obamabots

Breitbart: The war against online Obamabots

Rick Moran
Andrew Breitbart has an interesting column in today’s Washington Times where he analyzes the internet phenomenon of the Obama trolls who masquerade as conservatives trying to sow dissension in the ranks:

Uninvited Democratic activists are on a mission to demoralize the enemy – us. They want to ensure that President Obama is not subject to the same coordinated, facts-be-damned, multimedia takedown they employed over eight long years to destroy the presidency – and the humanity – of George W. Bush.

Political leftists play for keeps. They are willing to lie, perform deceptive acts in a coordinated fashion and do so in a wicked way – all in the pursuit of victory. Moral relativism is alive and well in the land of Hope and Change and its Web-savvy youth brigade expresses its “idealism” in a most cynical fashion.

The ends justify the means for them – now more than ever.

Much of Mr. Obama’s vaunted online strategy involved utilizing “Internet trolls” to invade enemy lines under false names and trying to derail discussion. In the real world, that’s called “vandalism.” But in a political movement that embraces “graffiti” as avant-garde art , that’s business as usual. It relishes the ability to destroy other people’s property in pursuit of electoral victory.

Hugh Hewitt’s popular site shut off its comments section because of the success of these obnoxious invaders. Breitbart.com polices nonpartisan newswire stories for such obviously coordinated attacks. Other right-leaning sites such as Instapundit and National Review Online refuse to allow comments, knowing better than to flirt with the online activist left.

Limbaugh calls them “seminar callers” because they always have a list of talking points that usually begin with the idea they were “outraged” with something some conservative said or did and were quitting the party because of it.

We get a few of them here at AT but they are usually pretty obvious about their true stands on the issues. But other bloggers have reported being inundated with these trolls and they are a real bother because they try and start flame wars between commenters and even between bloggers.

Breitbart explains why he believes the right won’t do anything similar:

 

The right, for the most part, embraces basic Judeo-Christian ideals and would not promote nor defend the propaganda techniques that were perfected in godless communist and socialist regimes. The current political and media environment crafted by supposedly idealistic Mr. Obama resembles Hugo Chavez’s Venezuela more than John F. Kennedy’s America.

The Huffington Post, Daily Kos and other left-leaning sites benefit from the right’s belief that there are rules and decorum in political debate and civic engagement. Of course, every now and then, a curious right-winger will go in and engage in discussion at a left-wing site, but rarely under purely disingenuous and mass coordinated means.

I believe that an oversimplification. The fact is, righty bloggers don’t engage in the same kind of tactics because, 1) liberal sites vet their commenters a lot more thoroughly than conservatives; 2) the righty blogosphere is not as organized as the left; and 3) fewer conservatives even bother to read liberal blogs than liberals who read conservative ones.

Andrew is crediting righty internet users with way too much piety. If we were more organized and the interest was there, I have no doubt we would be engaging in the same kind of disinformation campaign as the left does with us – Judeo-Christian values and aping the communists notwithstanding. The reason is, it works. And in politics, what works matters more than what’s right.

Cynical? Politics is a rather cynical enterprise and always has been.

 

Hat Tip: Ed Lasky

 

Page Printed from: http://www.americanthinker.com/blog/2009/03/breitbart_the_war_against_onli.html at March 31, 2009 – 10:42:51 AM EDT

Obama’s Most Telling Answer

Obama’s Most Telling Answer

By Joseph Ashby

Liberal columnist E.J. Dionne got it right when he recognized that the charitable deduction question was the most significant moment of the recent presidential press conference. (Now no one can say I never agree with a liberal.)

Like so many of President Obama’s off-prompter remarks, his answer on charitable deductions exposes him for what he is: an ideologically driven man whose philosophy is based on falsehoods and whose public persona is merely a marketing scheme to acquire the power he really wants.

 

In the press conference, The Politico’s Mike Allen asked: “Are you reconsidering your plan to cut the interest rate deduction for mortgages and for charities and do you regret having proposed that in the first place?”

 

Obama responded:

 

No, I think it’s the right thing to do; where we’ve got to make some difficult choices. Here’s what we did with respect to tax policy. What we said was that over the last decade the average worker the average family have seen their wages and incomes flat; even at times where, supposedly, we were in times of an economic boom.

 

Without hesitation, Obama begins his answer with deception. Incomes are simply not flat. It is true that Household income (the statistic used to defend Obama’s premise) has only risen slightly. But household size has declined. Income per person has increased significantly.

 

Obama has promoted “income stagnation” from a throwaway line in a campaign speech to the foundational basis of his tax policy.

 

Obama continues:

 

As a practical matter [working families'] incomes didn’t go up. And so what we said let’s give them a tax cut, let’s give them some relief; some help; 95% of American families. Now, for the top 5%, they’re the ones who typically saw huge gains in their income. I fall in that category.

 

After setting the false premise of 95% of incomes stagnating, Obama begins to attack the “rich.” To do so he makes the incorrect statement: the top 5% saw huge gains. The correct statement is: those who saw huge gains were in the top 5%.

 

This linguistically subtle change wholly invalidates Obama’s philosophy. In Obama’s mind, the top 5% exist independent of the world around them. They did have, do have, and will have more income than everyone else. In reality, there is massive turnover among the top wage earners. (For example, over half of the top 1% of wage earners in 1996 were in a lower category ten years later.)

 

Obama proceeds:

 

And what we’ve said is, for those folks (top wage earners) let’s not renew the Bush tax cuts. So let’s go back to the rates that existed back in the Clinton era, where wealthy people were still wealthy, were doing just fine.

 

Do we elect the president to decide who is wealthy or when they have enough? Is it the president’s job to take as much as is politically viable from citizens under the pretense they will still be “fine”?

 

Government’s responsibility is not to decide how much each citizen needs but to protect what each citizen earns. Only after the government secures earnings (aka property), can we address needs without danger of arbitrary confiscation based political expediency or misguided moral crusades (both of which motivate Obama).

 

Obama persists (later in his answer):

 

People are still going to be able to make charitable contributions, it just means that if you give $100, and you’re in this tax bracket at a certain point, instead of being able to write off 36 or 39%, you’re writing off 28%. Now, if it’s really a charitable contribution, I’m assuming that shouldn’t be the determining factor as to whether you’re giving that $100 to the homeless shelter down the street.

 

Here Obama seeks to obscure the fact that charities will be significantly hurt by this tax provision. To do so he refocuses on feelings of spite toward the high income earner, this time by questioning his motives for donating to charity. He claims:

 

And so this provision would only affect about 1% of the American people, they would still get deductions, it’s just that they wouldn’t be able to write off 39%.

 

This argument is both spurious and morally bankrupt. The provision he’s referring to would affect 2-3 times as many people as he claims. But even granting that the provision applies to just 1%, are we to conclude that because of the smallness of a minority we are justified in reducing its property rights? We would be rightly horrified if a president curtailed the rights of racial minority under the pretense of its small population.

 

It is itself misleading to argue in terms of the number of income earners affected. Dick Morris points out that the top 3% of tax filers make 44% of all charitable contributions. This provision will not have the inconsequential impact the president would have us believe.

 

Obama concludes:

 

In that sense what it would do is it would equalize. When I give a $100 I’d get the same amount of deduction as when a bus driver who’s making $50,000 a year or $40,000 a year gives that same $100. Right now he gets to write off 28%, I get to write off 39%. I don’t think that’s fair. So I think this was a good idea.

 

To summarize, Obama makes a persuasive case that a person should not pay higher tax rates based on that person’s income level. I’m sure Obama wasn’t intentionally endorsing a flat tax, but if his logic is applied generally we would all be paying an equal tax rate.

 

Inconsistency is typical of Obama’s policies. On the tax side, Obama advocates ever higher rates for certain income groups. On the deduction side he argues unequal rates are unfair.

 

Though Obama’s logic is cluttered, the results of his policies are not. Obama dependably advocates taking more and more from those he considers wealthy. His logical contradictions serve as cover for his ideological purity by allowing him to sound more reasonable from time to time.

 

There are many who maintain that Obama is not an ideologue. While there is no way to know for sure, his off-propter remarks seem to paint the most accurate picture. Since no one can read his mind, we are left to speculate as to his true intentions and ideas. As interesting as that debate is, it ultimately doesn’t matter what he thinks, only what he does. What Obama is doing is advocating laws that confiscate and control more money, thereby affording him more power and tighter command over the country.

Page Printed from: http://www.americanthinker.com/2009/03/obamas_most_telling_answer.html at March 31, 2009 – 10:36:03 AM EDT

Obama’s Appointment Crisis

Obama’s Appointment Crisis

By Kathy Shaidle
FrontPageMagazine.com | 3/31/2009

On March 25, yet another Obama administration nominee was forced to withdraw under a cloud of scandal. Jon Cannon had been President Barack Obama’s choice to become second in command at the Environmental Protection Agency. But the appointment has been scuttled by allegations of financial “irregularities” at the now-defunct America’s Clean Water Foundation, on whose board Cannon once served.

 

Two days later, the administration was hit with another personnel problem. One of the country’s main bank regulators, Scott Polakoff, was forced to take an open-ended “leave of absence” from the Treasury Department after internal audits suggested that he allowed financial institutions like IndyMac and AIG to exaggerate their balance sheets – in effect, to cook the books – a failure of oversight that contributed to the current financial meltdown. Federal Reserve Chairman Ben Bernanke told the Senate Budget Committee on March 3 that American International Group (AIG) “exploited a huge gap in the regulatory system” and that “there was no oversight of the Financial Products division,” an indictment that would seem to fall on Polakoff, who was second-in-command at the Treasury Department unit known as the Office of Thrift Supervision (OTS).

 

To be sure, Polakoff had been appointed to OTS by former president George W. Bush. But the Obama administration has also been tainted by the appointment, because Polakoff was promoted to acting director of the OTS in February by President Obama, after the retirement of former director John Reich. This pair of ignoble departures from the ranks of the new administration is another embarrassment for President Obama, whose term in office already has been marred by a series of disastrous high-level appointments.

 

The list of casualties is long and growing: controversial “energy and environment czar” Carol Browner; Tom Daschle, who owed $140,000 in back taxes; and most recently Charles Freeman, whose connections with Saudi Arabia and China raised questions about possible conflicts of interest, forcing Freeman to withdraw his name from consideration for a top intelligence post in the administration.

 

Other high-level appointees have also forced to step aside during Obama’s first few weeks in office. Former New Mexico Governor Bill Richardson was widely touted as a possible Secretary of State in an Obama administration, and was later tapped for the position of Commerce Secretary after Hillary Clinton landed the job at State. However, Richardson withdrew his name on January 4 due to a federal grand jury probe into “pay-to-play” contract influence allegations in his state. Obama’s second choice for Commerce Secretary was a Republican, Senator Judd Gregg of New Hampshire, who later withdrew as well, citing policy differences. An outspoken critic of the Iraq war, retired four-star Marine General Anthony C. Zinni, had been promised the job as ambassador to Iraq in late January only to be unceremoniously dropped from consideration.

 

The appointment crisis was starkly illustrated on a single day, when three different nominees backed out of senior positions with the Obama administration: Annette Nazareth, the nominee for Treasury deputy secretary; Dr. Sanjay Gupta, the senior medical correspondent with CNN who had been slated to step in as Surgeon General; and Caroline Atkinson, who’d been chosen to serve as undersecretary of international affairs by U.S. Treasury Secretary Timothy Geithner (who’d been confirmed after paying $35,000 in back taxes.)

 

Nancy Killefer was supposed to become Washington’s “first official waste watchdog,” but Obama’s choice to take the newly created post of White House Chief Performance Officer was also forced to withdraw due to pay unemployment taxes “on household help.” In her oddly worded official withdrawal statement, Killefer seemed eager to blame public scrutiny over her tax-troubles for her decision to withdraw, writing: “I recognize that your agenda and the duties facing your Chief Performance Officer are urgent. I have also come to realize in the current environment that my personal tax issue of D.C. Unemployment tax could be used to create exactly the kind of distraction and delay those duties must avoid.”

 

Last week, meanwhile, Obama’s choice for “urban policy czar,” Adolfo Carrion, was named in an investigation into possible wrongdoing. According to the New York Daily News, Carrion paid only $24,400 for a $50,000 home renovation project when he was still Bronx Borough President, raising concerns about possible favoritism.

 

Given the succession of failed nominees, it is should come as no surprise that the administration has struggled to fill cabinet positions. Of the 385 posts at cabinet-level agencies that a president must appoint, Obama had sent 100 names to the Senate as of March 24. So far, just 38 of those individuals have been confirmed. The President has also announced over twenty-five additional nominations which have yet to be submitted to the Senate. Nine weeks into the new administration, hundreds of other posts remain vacant.

 

Asked about the troubles plaguing the Obama administration, Susan Collins of Maine, the top Republican on the Homeland Security and Governmental Affairs Committee, said that the White House’s “earlier vetting system was clearly flawed.” However, she added, “Now I think the administration may have gone to the other extreme and is being so stringent in its requirements and going through such a lengthy process that it is difficult for [nominees who] are willing to serve.”

 

The situation shows no sign of improving. Senator Orrin G. Hatch (R-Utah) is critical of two upcoming nominees for both ambassador to Iraq and for assistant attorney general at the Justice Department. “There are a raft of others,” Hatch said. “I come at these matters with a desire to help the president, have him get the people he wants around him. But I’m really getting alarmed at some of the — I don’t want to call them all radicals — but some of the radical people who are being put into these sensitive, big-time positions.”

 

President Obama had promised a smooth transition from the previous administration of George W. Bush, as well as a thorough, transparent vetting process to ensure each appointee’s suitability for each job. But the string of aborted appointments has been a blemish on his brief time in the White House. There is a dark irony in the fact that Hillary Clinton, whose nomination for secretary of state was considered the most controversial of the administration’s appointments, has so far proven to be the most worry-free member of the president’s team.



Kathy Shaidle blogs at FiveFeetOfFury.com. Her new book exposing abuses by Canada’s Human Rights Commissions, The Tyranny of Nice, includes an introduction by Mark Steyn.
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