Yesterday, Senate Banking committee Chairman Christopher Dodd took responsibility for inserting language into the federal stimulus bill that protected bonuses like the controversial AIG bonuses. A Treasury official has acknowledged that the Obama Administration pushed for the language. On Tuesday, Dodd denied have any role in inserting the language.
I have been criticized (e.g., here and here) for referring on Countdown in this segment to the amendment protecting bonuses and saying “And I believe it was Dodd who inserted it.” While Treasury may have suggested it and pushed it, it was Dodd who agreed to insert it. Nevertheless, Dodd has stressed that it was the Obama administration that pressured him to add the amendment, which he did not want.
Now, Dodd has come out and acknowledged that indeed he was the member who put it into the bill.
This was a change from the day before when Dodd denied any role in adding the language. The record now also contradicts the earlier statements of the White House, which expressed no knowledge of the bonuses and outrage over the very notion of using stimulus funds in this way.
The new spin from members is that they had no choice but to protect past bonuses. That is not true in my view. I believe that language could have been crafted to keep these funds from being used as general revenue in this fashion or for the purposes of bonuses. Members simply did not want to spend sufficient time to draft the law properly and wanted to rush to get out hundreds of billions of dollars. Now, these same members who expressed concern over litigation are attempting to do something far more controversial — imposing a retroactive confiscatory tax.
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