House Speaker Nancy Pelosi (D-CA), after issuing a statement on Sunday vowing that Congress would examine ways to claw back AIG’s $450 million-plus in questionable bonus payments, isn’t letting go of the issue.
In a second statement released this afternoon, Pelosi urged the Treasury Department to do “use whatever tools at its disposal” — legal or otherwise — to reclaim the bonuses. And she reminded the rest of official Washington that Congress is already on the case.
The American people do not want their tax dollars spent on bonuses for AIG executives who have mismanaged their company into near bankruptcy. AIG executives should voluntarily forgo their excessive retention payments, but if they refuse, the U.S. Treasury should use whatever tools at its disposal to make AIG repay taxpayers.
AIG has turned on its head the basic principle that bonuses and retention payments are rewards for outstanding performance. No taxpayer funds should be used to pay bonuses or other unjustified compensation to AIG executives whose irresponsible risk-taking brought our financial system to the brink of collapse.
This week, Congress will demand further answers from AIG on the steps the government-controlled company will take to repay taxpayers. Congress and the Obama Administration are working to protect taxpayers from such irresponsible misuse of taxpayer funds.
After the jump, you can read more congressional reaction to today’s unfolding AIG flap.
House Minority Leader John Boehner (R-OH) asserted that his party has been pressing for an “exit strategy” from the bailout for months now:
For months, Republicans have repeatedly asked both the Bush and Obama administrations a very important question: what is the government’s exit strategy from this sweeping involvement in private business? We have done so because taxpayers are not receiving an adequate accounting from either the Treasury or the management of the companies that received taxpayer funds. Unfortunately, we have not yet seen such a plan. The latest revelation about AIG executives receiving millions in bonuses while taxpayers continue to bail out the company with hundreds of billions of dollars is outrageous and the clearest example yet of why an exit strategy is essential. The Administration should pursue all means of recovering these bonus payments and present Congress – and, more importantly, taxpayers – an exit plan as soon as possible.
Senate Majority Leader Harry Reid (D-NV) expressed confidence in the Obama administration’s efforts to get the bonus money back:
This weekend we learned that AIG doled out $165 million in bonuses to senior executives – bonuses paid for with taxpayer-funded bailout dollars. With millions of Americans out of work, staying up nights trying to figure out how to make this week’s paycheck last until the next, wondering how they’ll make the next mortgage payment or pay the overdue tuition bill, these executive bonuses are beyond outrageous.
President Obama has instructed Secretary Geithner to pursue every legal avenue to address this grievous abuse of taxpayer money, and I applaud that effort.
Our financial sector will never heal unless the financial companies who helped create this economic crisis begin to regain the public trust. The actions of AIG do just the opposite, and every American is justified in their outrage at this breach of public trust.
And Sen. Russ Feingold (D-WI) echoed Reid’s sentiment:
President Obama is doing the right thing by pursuing all legal options to cancel these bonuses. At a time when millions of Americans are losing their jobs and trying to make ends meet, it is outrageous that a company that has been bailed out by the taxpayers for its mistakes would turn around and pay its executives such a staggering sum of money.
Since some of the recipients of these bonuses may have been responsible for the practices that drove the company to the brink of collapse – jeopardizing the financial system – I am sure many Americans will question whether they are indeed “the best and the brightest” and whether they deserve this level of taxpayer-subsidized compensation.
