Wednesday, March 18, 2009

Don't blame Dodd, revisited

By Michael J.W. Stickings

Does Sen. Chris Dodd's admission that he was, as CNN put it, "responsible for language added to the federal stimulus bill to make sure that already-existing contracts for bonuses at companies receiving federal bailout money [e.g., AIG] were honored" change matters? That is, given this mea culpa, is Dodd the one to blame for the AIG bonuses?


Because it wasn't an admission -- and certainly not a mea culpa.

"The administration had expressed reservations," he said. "They asked for modifications. The alternative was losing the amendment entirely." In other words, it was the Obama Administration -- Geithner and Summers -- that pushed for the loophole, not Dodd. "I agreed reluctantly," he added. "I was changing the amendment because others were insistent."

Earlier today, I linked to, and quoted extensively from, Glenn Greenwald's post on the matter, a post that rightly credited Jane Hamsher, who has done some exceptional investigative work here, with exposing the shenanigans behind the loophole, and with pointing the finger directly at the Obama Administration. Glenn has updated his post in light of Dodd's "admission":

I explicitly wrote that it was Dodd who, after arguing vehemently against this provision, ultimately agreed to its inclusion. And the statement from Dodd's office that I quoted above included the same series of events ("Because of negotiations with the Treasury Department and the bill Conferees, several modifications were made, including adding the exemption"). That's exactly what Dodd said today on CNN.

The point was -- and is -- that Dodd was pressured to put that carve-out in at the insistence of Treasury officials (whose opposition meant that Dodd's two choices were the limited compensation restriction favored by Geithner/Summers or no compensation limits at all), and Dodd did so only after arguing in public against it. To blame Dodd for provisions that the White House demanded is dishonest in the extreme, and what Dodd said today on CNN about the White House's advocacy of this provision confirms, not contradicts, what I wrote.


It was the Treasury Department -- at least according to a Treasury official granted anonymity for the extremely compelling reason that he "asked not to be named" -- that pushed for the carve-out, and did so over Dodd's objections. That was the point from the beginning. That's precisely what made it so outrageous that the administration was trying to blame Dodd for a provision which Obama's own Treasury officials advocated, pushed for and engineered.

Now, there may be a Treasury (and Geithner/Summers) side to this that hasn't yet been effectively articulated. Perhaps, just perhaps, "the limited compensation restriction" was the best that could have been achieved. But I suspect not. And what is simply revolting -- if not nearly as revolting as the AIG bonuses, of course -- is the campaign of blame that has been waged against Dodd, an avoidance of responsibility on the part of the administration along with an assault, of sorts, on a loyal Democrat and one of the key figures in the Senate on the bailout issue.

Glenn is right. This is "dishonest in the extreme." And, as far as I can tell, it's simply indefensible.

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