The Obama administration is engineering its new bailout initiatives in a way that it believes will allow firms benefiting from the programs to avoid restrictions imposed by Congress, including limits on lavish executive pay, according to government officials.
The administration believes it can sidestep the rules because, in many cases, it has decided not to provide federal aid directly to financial companies, the sources said. Instead, the government has set up special entities that act as middlemen, channeling the bailout funds to the firms and, via this two-step process, stripping away the requirement that the restrictions be imposed, according to officials.
Although some experts are questioning the legality of this strategy, the officials said it gives them latitude to determine whether firms should be subject to the congressional restrictions, which would require recipients to turn over ownership stakes to the government, as well as curb executive pay.
Have you got that? On the same day that the BLS reports 668,000 lost jobs for the month of March, a total of 5.1 million lost since the beginning of the recession in December 2007, President Merit Pay is going to make sure that the same criminals/bankers/financial executives who brought us this mess can continue to live their lavish lifestyles, rake in the big executive bucks and yuck it up at the club smoking cigars and drinking martinis with their banker buddies - and he plans to break the rules, or as we used to call it, "the law," to do it.
Now I understand the administration is claiming that financial institutions in need of government money won't ask for it if the restrictions placed on the TALF dough by Congress remain.
But you know what? That's bulls$%t - these institutions are insolvent and they're asking for a taxpayer-funded bailout. Anybody in the administration ever hear the phrase "beggars can't be choosers"? Apparently not - at least not if the beggars are former Masters of the Universe on Wall Street. If you're a begging member of the financial industry, you get a photo-op at the White House with smiles and chuckles all around. And lots of free money, restriction-free.
But if you're an auto industry CEO or a member of the UAW, then watch out below, brother. After General Motors took far fewer bailout dollars from the government than Citigroup, BoA, and AIG did, GM CEO Rick Waggoner was shown the door by President Merit Pay as a way of showing the country that the auto industry must get "serious" in fixing their financial problems. And after claiming that the AIG bonuses could not be taken back because the contracts that guaranteed them are sacrosanct, the Obama administration is prepared to force the UAW to eat its current contract and make concessions, concessions, concessions in order to help fix GM's problems.
Ironic how the Masters get treated so differently by President Merit Pay and his merry band of bailouters than the carmakers do. Wonder if it has anything to do with just who is in this administration and the fact that the contracts being broken are union contracts?
Hmm - here's a clue. The Wall Street Journal reports that President Obama's second-in-command on the economy, Larry Summers, received $2.7 million dollars in compensation last year for giving speeches to many of the same firms he is handing bail out money to - firms like Goldman, JP Morgan, and Merrill Lynch. In total, Mr. Summers made $5.2 million last year from his work on Wall Street helping the Masters of the Universe.
Gee, no wonder the administration is telling Europeans they favor a less stringent regulatory approach to the financial industry - the financial industry is running them. And no wonder they're setting up a money laundering scheme to get the TALF money to the financial industry "restriction-free" - they're being compensated for it.
Meet the new crime bosses in Washington, same as the old crime bosses.