ObamaOdrama

Treasury Secretary Tim “Turbo Tax” Geithner is still at it pressing for more control over Wall Street.  Appearing before the House Financial Services Committee today, Geithner bandied about terms like systemic risk, consumer/investor protections, international coordination, and of course greater regulatory power.  But as is his custom, Geithner had no specifics and was unwilling or unable to answer questions challenging his fundamental argument that government needs more control of financial institutions yesterday

You can find the entire hearing at C-SPAN

Rep David Scott (D-G) surprisingly asked a fair question.  Since insurances companies are already regulated at the state level, and were not at the heart of the financial crisis, is there a conflict in this broad extension of government power?

How does Geithner respond?  “Excellent question.  Let me just start by saying what we need is better, smarter, tougher regulations.”  That is not an answer.  Nor did he address the main part of the question in his elaboration.  Unfortunately, he was not pressed on the matter either.

Rep. John  Campbell (R-Cali.) following up a line of questioning about Geithner’s proposal for resolution authority and the framework for that authority stressed, “my concern, Mr. Treasury Secretary, would be that if you have, that this is a pretty extreme authority of receivership.  But if you have that authority without the complete information and perspective of a full regulatory framework,  wrong decisions could be made.”

“We designed this proposal to fit within current laws… so that, I mean, current regulatory structure.  You could move on this proposal… alone, and once you do the broader regulatory redesign we’re proposing, you could come back and make sure they fit… you could do it that way,”  Geithner responded.

Geithner even went further claiming it was a great tragic failure of the country that the government didn’t possess the proposed broad authority at the start of the economic crisis and that it was in the interest of the country, for Congress to do everything it can to make sure they’ve got broader tools to manage this effectively.  Basically, just give us the power now and we’ll discuss details later. 

This guy was the President of the N.Y. Federal Reserve since 2003!  It was his job to supervise and regulate financial institutions and he failed!  Just look at the bang up job he did to help call attention to the pending economic crisis during his watch.  Bear Sterns and Lehman… Fail.   Either through malfeasance or incompetence he failed to pay $35,000 in taxes using Turbo Tax - software the majority of Americans use to file.  Not to mention he masterminded the bail out of AIG to the tune of $170 billion of our tax dollars!  He now believes he and the government should be given absolute authority over every financial institution in this country without a speck of proof that even bailing out AIG was in our best interest?  Without detailing the conditions on this new power?

What business decisions are too risky to pursue?  Would a business investment be too risky?  Would an acquisition merger be too risky?  Perhaps not going through with a merger is too risky.  How much is too little capital, how much is too much?  Enough is enough!

Wake up people!  These guys in office are just manipulating your frustration and helplessness to further their own political agendas.  The government doesn’t care they spent $170 billion on AIG because it’s not their money.  The government knew about and approved the AIG bonuses before they were ever outraged.  But by portraying AIG as greedy, fat cats the government can fool you into agreeing with this power grab among others as if it serves AIG right.  But hey, nevermind the government is getting ready to shell out another $30 billion to evil AIG.    No, government isn’t looking out for you and you don’t have to look out for big government. 

it’s coming whether you like it or not.

Appearing before the House Financial Services Committee today, Treasury Sec. Tim “Turbo Tax” Geithner asked Congress to grant the White House the unprecedented authority to seize non-bank financial institutions if those firms are “perceived” as tottering toward failure.

“As we have seen with AIG, distress at large, interconnected, non-depository financial institutions can pose systematic risks just as distress at banks can. The administration proposes legislation to give the U.S. government the same basic set of tools for addressing financial distress at non-banks as it has in the bank context,” Geithner told the committee.

“AIG highlights broad failures of our financial system,” Geithner told the House Financial Services Committee. “We must ensure that our country never faces this situation again.”

What?!?   After having chosen to bail out this miserable firm while letting Lehman fail, the bumbling architect is now arguing that the Obama administration needs greater control of all financial institutions? 

This is a very bad omen…nothing amusing about it.  Not one bit.

The Working Families Party, ACORN, and media teamed up for a little AIG outrage party while 300 people were forced to have a quiet Tea Party not too far away.

Last week I wrote about how the Connecticut Working Families party was staging an outrage tour of the homes of some of AIG’s executives. Maybe, ACORN is just practicing for the 2010 Census but they decided to join in on the outrage. Not surprisingly, every media outlet was notified of the little party and showed up in force outnumbering the “activists” three to one.

Meanwhile elsewhere in Connecticut, about 300 people staged a Tea Party protesting taxation, increased government spending and the “little” bailouts that lie at the heart of the AIG scandal. Media coverage was clearly preoccupied.

Despite that these tea parties are springing up all across the nation in growing numbers, they receive very little national coverage. It makes you wonder how far the average person will be forced to go just to get some attention… maybe throw Barney Frank or Chris Dodd a house party?

According to government officials, the Obama administration may sidestep legislation for regulation of executive pay at every bank, financial institution, and “possibly” any publicly traded company.

The New York Times reports:

The administration has been considering increased oversight of executive pay for some time, but the issue was heightened in recent days as public fury over bonuses spilled into the regulatory effort.

The officials said that the administration was still debating the details of its plan, including how broadly it should be applied and how far it could go beyond simple reporting requirements. Depending on the outcome of the discussions, the administration could seek to put the changes into effect through regulations rather than through legislation.

One proposal could impose greater requirements on company boards to tie executive compensation more closely to corporate performance and to take other steps to ensure that compensation was aligned with the financial interest of the company.

The new rules will cover all financial institutions, including those not now covered by any pay rules because they are not receiving federal bailout money. Officials say the rules could also be applied more broadly to publicly traded companies, which already report about some executive pay practices to the Securities and Exchange Commission.

Think Obama would be so quick to implement any such regulations if they were directed at his salary?

According to the AP, Senate Republicans are calling for a little consideration before Congress makes another bad decision:

WASHINGTON – Senate Republicans are drawing out a flap that has made the Obama administration squirm, applying the brakes to Democratic attempts to quickly tax away most of the bonuses at troubled insurance giant AIG and other bailed-out companies.

Sen. Jon Kyl, the Republicans’ vote counter, blocked Democratic efforts Thursday evening to bring up the Senate version of the tax bill to recoup most of the $165 million paid out by AIG last weekend and other bonuses in 2009. The House had swiftly approved its version of the bill earlier in the day.

By rushing, Kyl said, Democrats were letting populist outrage trump informed decision making in the Senate, which is supposed to be insulated from the pressures of public passion.

“I don’t believe that Congress should rush to pass yet another piece of hastily crafted legislation in this very toxic atmosphere, at least without understanding the facts and the potential unintended consequences,” Kyl said on the Senate floor. “Frankly, I think that’s how we got into the current mess.”

One of the most reasonable ideas to come out of Washington in some time.