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They Knew…

By way of Bruce McQuain, who you will recall, I was a little harsh with last week on the AIG thing, comes this news [1]:

The other shoe concerning the AIG “bonuses” and the administration’s knowledge of them is beginning to drop. The Politico [2] reports that all of the outrage from both Congressional and administrative officials is simply a front. All of them knew.

Watching the coverage the past 24 hours, it would seem AIG just made public its plans to give top employees big bonuses. Wrong.

AIG disclosed its retention-bonus program more than a year ago, including bonuses directed to those handling the exotic derivatives that got the company and the country into this mess.

The bonuses were essentially a nonissue when AIG got its initial bailout money, almost $150 billion under President Bush in the two months surrounding the presidential election. Joe Biden, then the vice presidential nominee, came out strongly against the bailout. Obama did not.

Timothy Geithner, then at the New York branch of the Federal Reserve, was a huge proponent and architect of the AIG bailout. So if Obama had strong private opposition to the idea it did not affect his pick for the person who would oversee all bailouts.

In fact, if you look at the first line in the letter [3] AIG CEO Liddy wrote to Geithner, it is clear he at least knew about all of this before last Friday:

Thank you for the open and frank conversation on Wednesday regarding the compensation arrangements at AIG Financial Products and AIG generally. I admit that the conversation was a difficult one for me.

And there’s more:

You have also asked AIG to rethink our 2008 corporate bonus proposals. The proposals AIG originally submitted to you are part of a deliberate process, recommended by me and supported by the independent compensation committee of AIG’s board of directors.

So what you’re seeing out of the Obama administration is demagoguery at its worst. This was a plan being worked with the previous administration and the present administration, and when AIG payed those monies out last week Friday (they were required by law to do so prior to March 15), it was with the full knowledge and apparent acquiescence of the Obama administration, and, one assumes, key members of Congress.

So, in the end this is as I said the other day in reference to some on the right… that moron Charles Grassley, for one, complaining about AIG:

…this thing is going to be fought out in the court of public opinion. If you think the court of public opinion is driven largely by facts, explain to me how it is that Obama is currently residing in the White House. So what is going to happen here is that we’re going to hear all about how the government is faultless in this and that all we need to go after is capitalist greed. If you think I’m exaggerating, listen to the tone of the pronouncements coming from Harry Reid Nancy Pelosi and so on.

However you lay this argument out, it all bottom lines at the Democrats running the government attempting to project the private businesses and banks involved as something evil. Something that desperately needs their supervision , and we’ll get that supervision whether the people want it or not. They are pitching that narrative for a reason. In my view, it’s the same reason as they are spending so very much time lately with Bernie Madoff. Granted, the guy is evil. At the same time he provides reinforcement to the Democrat position that all usual businesses are that way, that all rich people are that way, that all capitalists are that way. Call it what you will, but that is the biggest reality in our government right now, which is why the markets are still on their ass.

I am terribly afraid that the Democrats must not be allowed to control the narrative here, or there will never be a hope in hell of maintaining a capitalist society again in this country. That, I think, is their aim. Laying tone deaf label at the feet of any private firm, AIG included, at this point for operating inside the law and operating to make a profit allows the Democrats to extend that narrative.

Nobody’s keen on the idea of this money having been spent that way, but that is something that the Democrats should have thought of before they voted on a bill they didn’t read. The blame for that is squarely in their lap. Allow them to place any blame for any of this on AIG, and the Democrats control and extened that ‘evil capitalism’ narrative in the court of public opinion.

We now have proof that all this noise, all this smoke, all this faux outrage about AIG was planned in advance, and the American people are getting played for suckers by the Democrats. And frankly, I suspected something of the sort all along. The Democrats never mount that unified a howling session without some serious planning beforehand.

I argued as I did with Bruce’s logical argument because of an instinctive mistrust of anything the Democrats offer. Sad to say, those instinctive misgivings have never been disproven yet.

 

The question now becomes, will the Democrats be hed accountable for this outrage, as they ought?