Obama On The AIG Bonuses: "The Buck Stops With Me"

Via Greg Sargent, President Obama accepts the responsibility for the AIG bonus fiasco:

Asked if he wished he’d known about the bonuses sooner, Obama said, in the course of answering: “Ultimately, I’m responsible. I’m the President of the United States…The buck stops with me.”

President Obama will be held responsible (or will get the credit) for what is done with the financial crisis in any event come 2012. That is why he should not worry about the short term politics but instead focus on what he thinks will work. My own view is that the policies he has implemented so far are much too timid and will not work.

Speaking for me only

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    Saying "the buck stops with me," (5.00 / 7) (#6)
    by Anne on Wed Mar 18, 2009 at 03:12:12 PM EST
    is not the same as actually answering the question - which he did not do.  What that tells me is the someone - maybe more than a few someones, possibly including Obama - did know about the bonuses sooner.  A lot sooner.  I suspect that the Wall Street Boyz who are part of the administration and who are giving the Obama administration the benefit of their wisdom made convincing arguments for why it made sense not to fight the bonuses, and in the insular bubble in which all of this is happening, it seemed eminently plausible and credible.

    Answering the question has its perils - which is why he dodged it in a way that sounded mature.  If he had said he had known about them for some time, his judgment would be called into question.  If he had said that he did not know - and we are aware that others on the team did - we call into question what kind of administration it is where the president is not informed of important facts.

    By saying the buck stops with him, he's either covering for himself, or someone else, don't you think?  And he's trying to make the argument that it doesn't matter.

    Fiddle, dither, diddle, muddle, dodge.  


    That's the word (5.00 / 0) (#7)
    by Inspector Gadget on Wed Mar 18, 2009 at 03:14:21 PM EST
    What that tells me is the someone - maybe more than a few someones, possibly including Obama - did know about the bonuses sooner.  A lot sooner.



    In the end, it is a political, (5.00 / 1) (#9)
    by MKS on Wed Mar 18, 2009 at 03:24:54 PM EST
    not an economic, issue.....The payments won't make a difference in how our economy recovers....

    It does give people a chance to blast Obama, however....  


    Interesting (none / 0) (#17)
    by Inspector Gadget on Wed Mar 18, 2009 at 03:48:21 PM EST
    So, if it's a political issue, the politicians involved should be given a free pass? Obama is not the only one involved in this, so I'm not sure why you've singled him out.

    It is a matter of perspective (none / 0) (#30)
    by MKS on Wed Mar 18, 2009 at 05:13:42 PM EST
    The bonuses are a problem but not the largest one we face, and will be forgotten....The issue is does the economy recover....

    Yes. They knew. (5.00 / 3) (#13)
    by Cream City on Wed Mar 18, 2009 at 03:32:58 PM EST
    Posted that AP info here yesterday, and more posts today make it clear:  They knew.

    How long it will take to make it clear to everyone in the public, and here, who knows. . . .


    Are you as tired as I am of (5.00 / 5) (#15)
    by Anne on Wed Mar 18, 2009 at 03:40:57 PM EST
    being treated as if we are too stupid to be paying attention to the information that is coming out?

    And as tired of the media being placated with such simplistic answers?


    Yes, I was tired of this treatment (5.00 / 3) (#24)
    by Cream City on Wed Mar 18, 2009 at 04:04:27 PM EST
    by the previous administration and all of its lies peddled by the media.  

    If there is one "change" I had "hoped" to see, it was an end to such a level of dishonesty, its disrespect of the public -- i.e., of me -- from the government and what it peddles via the media.

    That is, I do not put all the blame on the media.  It is a conduit available to be used far better.  But so far, all we're seeing is more garbage in from the government, garbage out through the media.


    To Cream & Anne (5.00 / 3) (#29)
    by NYShooter on Wed Mar 18, 2009 at 04:36:48 PM EST
    I'm addressing my comments to you (its o.k. if anyone else wants to listen in) because you've hit on the point that, for the life of me, I can't figure out.

    Nobody questions the fact that Obama, Geithner, et al are absolutely brilliant folks, but the excuses made for them, that they're just careless, or absorbed in other things, or whatever the excuse of the day is, just doesn't pass the smell test.

    Wunderkind Geithner came from the highest ranks of Investment banking, former chief of NY Federal Reserve bank, yadda, yadda. They couldn't possibly be that stupid that they didn't know people would be hyper suspicious of these consummate insiders taking over the hen house; especially since we voted en-masse for "change."
    O.K, so we didn't get "change," but we didn't get "smart" either. What we got was timidity, confusion, duplicity; certainly not "ready on Day 1."

    This sort of reminds me of that Clint Eastwood "Dirty Harry" movie where hijackers take over an airliner, and demand an overseas pilot. Clint, dressed in a pilot's uniform, goes on board and settles into the command pilot's seat. When the co-pilot, noticing Clint's unfamiliarity with the controls says. "Excuse me captain but, have you ever flown a jetliner before?" Clint replies, "I've never even taken a lesson."

    "Obama Baby, you were a great candidate, so why am I getting that sinking feeling in my stomach?"


    Careful! (5.00 / 1) (#33)
    by jbindc on Wed Mar 18, 2009 at 05:23:08 PM EST
    Them's fightin' words around here to some - comparable to being a traitor.  You will be accused by some of parroting Republican talking points or being a Republican troll! :)

    What we got was timidity, confusion, duplicity; certainly not "ready on Day 1."



    the sinking feeling in the stomach (5.00 / 1) (#42)
    by christinep on Wed Mar 18, 2009 at 09:24:36 PM EST
    Your frustration and concern are understandable, NYshooter. You titled the Secretary a "Wunderkind." If so--and as previous NY Federal Reserve bank chair involved deeply in the several related negotiations during the autumn days of economic concern--T. Geithner surely had a close perspective on the whole matter. When he was first nominated, so many referenced his abilities and his understanding/involvement with the issues on Wall Street. Up close & personal. Maybe that is the real problem or dilemma: Geithner may be too close to the problem. (Remember that a lawyer should not represent himself/herself; a doctor is not to perform surgery on a close family member, etc.) Close personal and professional relationships that have existed over time may cloud one's perspective. Geithner essentially lived Wall Street. That made his expertise valuable; but, it may also have obscured his ability to reason anew.

    brilliant does not equal (5.00 / 0) (#46)
    by sancho on Thu Mar 19, 2009 at 12:49:06 AM EST
    doing the right thing or advocating for the right folks. obama's ties to the financial industry were evident during the primaries. so far his actions and those of his people have been entirely consistent with what one expect given his supporters.

    NYShooter, I think what people fail to (4.00 / 3) (#43)
    by Anne on Wed Mar 18, 2009 at 10:04:51 PM EST
    address when they start talking about the brilliance of some of these people, and their insider knowledge of the Street that was supposed to render them so capable of dealing with the economic crises we face, is what their focus was in their Wall Street careers.  Was it on protecting the average investor, or was it in clearing a path for the financial geniuses to keep coming up with more and more creative ways to keep making boatloads of money, regardless of how dangerous and risky those ways were?  Was it in turning a blind eye to the bright neon signs that were flashin "Danger!" because there was so much money to be made?

    The same ego that drove these people to inventing more and more risky ways to make money is making them tone deaf to what the vast majority of people are perceiving about where things are now.  Millions of people are looking at greatly diminished retirement accounts and 529 plans and wondering how it is that while their futures have been compromised by the Wall Street Cowboyz, those cowboys are still benefiting through bonus plans designed to guarantee them rewards denied to those average investors because of their actions.

    I don't need to hear Obama channeling "Mr. Cool," and condescending to the American people about the "bunch of folks" who robbed them, and pretending that simply saying the buck stops with him is enough; it isn't.  He needs to decide whose side he's on in this debacle, and so far, it seems he's pretty happy being in the Wall Street Cowboyz Club, even if he occasionally manages to raise his voice about the "bunch of folks."


    You know, Anne (5.00 / 1) (#47)
    by NYShooter on Thu Mar 19, 2009 at 03:13:47 AM EST
    I like to believe that these guys aren't motivated by greed, at least not in their current public roles. But I happen to know a lot of extremely wealthy people and F. Scott Fitzgerald was right when he said, "the rich are different than you and me."

    That's why I said, they "can't" be that stupid. They go through life wearing 3-d like glasses, like the "absent minded professor. Having no personal financial stresses in their lives, they simply don't, or can't, empathize with people that sweat every threat to their mere subsistence. So many millions of us are one illness away from poverty, or one overtime cutback from food stamps, or one 2'nd job elimination from foreclosure; never mind the millions who don't have to look into the future to fear these things, but have tearfully already succumbed to these tragedies.

    Now we have some commenters here who see a little blip here, and a tiny anomaly there (after being drenched in billions and billions of our dollars) and take it as a sign that a turnaround may be near, or we may nearing a bottom. Well, I had an old '34 dodge in my backyard years ago, and after poring a gallon of ether down its carburetor throat, it started, and even ran a minute of two. And, while the full effects of the stimulus package haven't kicked in yet, the full effect of the millions who lost their jobs, and the millions yet to lose theirs, haven't kicked in yet either.

    Look, I'm no genius in these things, but Paul Krugman, who's been right all along, has been saying that Obama had his chance. When this downturn began picking up speed, but before it gained full-tornado force, he called for massive infusions of money, especially to those who needed it, and would spend it immediately. Instead, we got a water pistol, when we needed a twelve alarm fire hose. Wasn't it Secretary of Defense Powell who said, (I may be paraphrasing) "When you go to war, you go with "overwhelming force," and "when you find the enemy, like a snake, You cut its head off!"

    For a layman like me, Krugman and Powell make a lot more sense than Obama and Geithner.

    I hope I'm wrong, Anne; Boy! I hope I'm wrong.


    Evening news perhaps? (5.00 / 1) (#22)
    by nycstray on Wed Mar 18, 2009 at 03:58:09 PM EST
    It's getting spelled out pretty clearly that the House and Senate did not originally vote for a bill that included the "closed door revision". That lil' sucker may just have some teeth . . .

    The good thing about that answer (none / 0) (#10)
    by magster on Wed Mar 18, 2009 at 03:29:16 PM EST
    is that when the truth comes out, he can say he already owned it with today's answer.

    Signs of improvement? (none / 0) (#1)
    by magster on Wed Mar 18, 2009 at 02:41:37 PM EST
    Are the signals of improvement (e.g.: increasing new housing starts) unsustainable because the stimulus is too small?

    Also, Liddy testified that the Fed knew about the bonuses for a long time (months), but does not know if the Fed told Geithner.  If Geithner knew long ago and pedaled this "I did not know until last Thursday", the buck really did stop with Obama and Obama screwed up bad.  Geithner would likely need to resign, which would be a huge embarrasment to Obama.  

    Geithner and Summers knew (5.00 / 4) (#2)
    by Cream City on Wed Mar 18, 2009 at 02:46:15 PM EST
    according to (see links in other posts) Greenwald, Hamscher, and now the (corrected, thanks to them, I bet) New York Times, et al.  Geithner and Summers -- the Obama administration -- got the Dodd restriction stripped from the bill six weeks ago.

    Neither Geithner nor Summers ever ought to have gotten their posts; they began from behind, with their bad behaviors before.  With this latest debacle, they ought to go.

    And Gibbs, too, for his parroting of the administration's untruths about Dodd.  I'm no fan of his, but the dishonesty of Geithner, Summers, Gibbs, and others is hurting Obama's ability to get a darn thing done.  And that is not good for us.


    So many red flags on Geithner (5.00 / 4) (#3)
    by magster on Wed Mar 18, 2009 at 02:52:03 PM EST
    accompanied by lots of criticisms of the pick.  Obama went into this with his eyes wide open. This is really going to hurt him.

    Thank God for Limbaugh trying to take back the label of "corporatists" for the GOP.  If the Dems lose the populist label, the GOP might rise again.


    Do you think those guys are (5.00 / 2) (#5)
    by Inspector Gadget on Wed Mar 18, 2009 at 02:54:02 PM EST
    And Gibbs, too, for his parroting of the administration's untruths about Dodd.  I'm no fan of his, but the dishonesty of Geithner, Summers, Gibbs, and others is hurting Obama's ability to get a darn thing done.  And that is not good for us.

    speaking these twisted versions of reality without Obama's knowledge? The buck stops where?


    Of course not. Read again. (5.00 / 3) (#11)
    by Cream City on Wed Mar 18, 2009 at 03:30:53 PM EST
    I wrote:

    Geithner and Summers -- the Obama administration --

    Obama has a four-year appointment from us.  Can't do anything about that now.  But these guys have appointments from him, at his pleasure.  Obama ought to be displeased with them.



    Got it and completely agree (none / 0) (#18)
    by Inspector Gadget on Wed Mar 18, 2009 at 03:50:45 PM EST
    I think this is one of the most fascinating administrations of my lifetime.

    Is that a positive or negative thing? (none / 0) (#23)
    by coast on Wed Mar 18, 2009 at 03:58:58 PM EST
    Well, it's not good (5.00 / 1) (#28)
    by Inspector Gadget on Wed Mar 18, 2009 at 04:35:40 PM EST
    and, even if everything turns out just great in the end (global economy), I still have to say that the tactics being used are astonishing, and I hope never to be repeated. With GWB we always knew who was fabricating the truth.

    50 days in and you (none / 0) (#32)
    by MKS on Wed Mar 18, 2009 at 05:15:36 PM EST
    have reached that conclusion?.....

    Er, the talking point was ... (5.00 / 0) (#37)
    by lambert on Wed Mar 18, 2009 at 07:08:12 PM EST
    "Obama's only been President 30 days" (superseding "Wait 'til he does something").

    There's a new release? Why didn't I get the memo?

    Unless that was irony, of course.


    Not a talking point--just simple math (none / 0) (#41)
    by MKS on Wed Mar 18, 2009 at 07:35:27 PM EST
    Obama took office on January 20, 2009.  It is now March 18, 2009.  That is 57 days.  

    So, is 57 days enough time to write the book on Obama?   Let the stimulus work....


    Oooh, ANOTHER talking point! (5.00 / 0) (#54)
    by lambert on Fri Mar 20, 2009 at 11:06:28 AM EST
    "Let the stimulus work."* I'll have to see who else is using that one.

    To answer your rhetorical question, it's enough time to write the introduction:

    This administration, elected on the promise of change, has already managed, in an astonishingly short time, to create the impression that it's owned by the wheeler-dealers. And that leaves it with no ability to counter crude populism.

    To answer your substantive point: it's very unlikely to work. I guess some people would rather "let" the controlled flight into terrain happen....

    NOTE * Although, in its invitation to passivity, it's quite similar to the earlier "Wait 'til he does something."


    I don't keep track of who else is (none / 0) (#57)
    by MKS on Fri Mar 20, 2009 at 07:09:25 PM EST
    coming to a similar conclusion as I am....I have already told you that....

    Time will tell.....


    He promised to be ready and right on Day 1 (5.00 / 0) (#48)
    by chezmadame on Thu Mar 19, 2009 at 07:59:15 AM EST
    I think that part of being ready includes having at least a few under-secretaries in place at Treasury two months into office.

    Well, let's see..... (none / 0) (#50)
    by NYShooter on Thu Mar 19, 2009 at 10:49:02 AM EST
    Those who have been right all along, like Krugman, haven't been invited to join; The others, having gotten a glimpse of the "gang that couldn't shoot straight," have been besieged by here-to-fore dormant, "pressing family issues."

    Being able to answer the phone ranks high for me (none / 0) (#55)
    by lambert on Fri Mar 20, 2009 at 11:08:08 AM EST
    Wholesale firing of people (none / 0) (#8)
    by MKS on Wed Mar 18, 2009 at 03:21:42 PM EST
    would only make things worse....That would make Obama look very weak and confidence would flag.  Just bypass the ones who are not getting things done.

    Summers is taking a more visible role and may ultimately eclipse Geithner....

    There is data to suggest that the bottom is near....So, I hope BTD is wrong....

    Christina Romer on Meet the Press said that the stimulus was not the only boost to the economy--one also had to consider the TARP money and the housing plan....Taken together they are a big shot in the arm to the economy, she said, clarifying earlier remarks she had made about the stimulus perhaps being too small.

    Dr. Romer will help Obama....She could be the next Secretary of the Treasury if Geithner gets in real trouble.....  


    Actually, I think the housing starts (none / 0) (#4)
    by Inspector Gadget on Wed Mar 18, 2009 at 02:52:37 PM EST
    are more a product of Spring than financial upturns.

    The numbers are seasonably adjusted (5.00 / 1) (#12)
    by MKS on Wed Mar 18, 2009 at 03:32:01 PM EST
    and February is a lot warmer than January?

    We do not have any numbers for the Spring--because we are not yet in Spring.....


    Every part of the country is different (none / 0) (#20)
    by Inspector Gadget on Wed Mar 18, 2009 at 03:53:32 PM EST
    and this has been a really crazy weather year, MKS. It wasn't much of a rise considering it was only being compared to January...and the builders are going to kick into action every second they can to try to get the houses done and sold before anything else happens.

    The numbers say the starts (none / 0) (#34)
    by MKS on Wed Mar 18, 2009 at 05:28:26 PM EST
    went up....Arguing against the data didn't help the Bush administration.....

    The builders I know aren't quick to do anything and generally do not want to roll out product right now....Countless housing projects have been shelved....Rushing product to market right now?  No, not happening....

    The problem with starting new building is that you have to take out construction financing --which is virtually non-existent right now anyway.  Merchant builders who could get financing don't want to incur the liability of new loans and loan payments, hoping the houses sell. So, everyone sits.

    That starts are up is unqualified good news and shows some thawing in the market....it may or may not hold, but it is good news....


    Yeah, this one was all over Eschaton too (5.00 / 1) (#38)
    by lambert on Wed Mar 18, 2009 at 07:09:20 PM EST
    Coordinated in the 8:45 call?

    Not sure what your point is (none / 0) (#39)
    by MKS on Wed Mar 18, 2009 at 07:28:29 PM EST
    You accept the data, or not....

    I have no idea what eschaton is.....and don't coordinate with anyone....It is in the news, and is a closely watched number....


    I think his point might be (none / 0) (#49)
    by chezmadame on Thu Mar 19, 2009 at 08:09:54 AM EST
    that being while being "on message" works well in campaigns, it is no substitute for competence in times of crisis.

    It is encouraging that housing starts are up 22% from January's dismal numbers.

    It is, however, discouraging that, despite the uptick, they are still down over 40% from a year ago.


    I suppose any piece of good news (none / 0) (#51)
    by MKS on Thu Mar 19, 2009 at 12:17:08 PM EST
    can be turned into a half-empty view.

    And, as to being "on message", there is more than one "message," and it isn't a pro Obama one.....


    While your supposition (none / 0) (#52)
    by chezmadame on Thu Mar 19, 2009 at 04:05:05 PM EST
    might in many cases be correct, I don't think it is the case here. It's important to put the news of an uptick in a broader context, lest we lose sight of the problems we face. The economy is not a 24 hour news cycle.

    Here's the whole picture:

    Although it may not be wise to argue against data, arguing from partial can also be problematic.


    Thank you, chez madame (none / 0) (#53)
    by lambert on Fri Mar 20, 2009 at 11:00:58 AM EST
    You made the point a lot better than I did.

    In the stock market, (none / 0) (#14)
    by NYShooter on Wed Mar 18, 2009 at 03:36:37 PM EST
    we call it a dead-cat bounce.

    Could be (none / 0) (#40)
    by MKS on Wed Mar 18, 2009 at 07:31:47 PM EST
    but it is better than going down....

    Housing stock on the market is going down....population is rising....at some point, something has to give....

    Most people don't realize when a recession begins, and the same holds true for recoveries...


    You assume this is a recession not a depresss (none / 0) (#56)
    by lambert on Fri Mar 20, 2009 at 11:10:03 AM EST
    And if it's not? What then?

    Not many naysayers say even that (none / 0) (#58)
    by MKS on Fri Mar 20, 2009 at 07:14:35 PM EST
    Unlike the 1930s, we don't have 25% unemployment; we do have a safety net with countercylical funding; we haven't had a run on banks that has decreased the money supply; the Fed has opened the spigot as far as it will go, especially with its decision yesterday to buy Treasuries; and we haven't cut off international trade with protectionism.

    Krugman isn't prediciting a depression.


    Arianna was calling (none / 0) (#16)
    by Amiss on Wed Mar 18, 2009 at 03:47:24 PM EST
    for both Geithner and Sullivan's resignations last nite on Larry King. She actually shocked me with her statement.

    I'm shocked (5.00 / 3) (#21)
    by NYShooter on Wed Mar 18, 2009 at 03:58:02 PM EST
    that anyone would give her a microphone, or care what she thinks.

    honestly (none / 0) (#25)
    by Amiss on Wed Mar 18, 2009 at 04:07:37 PM EST
    It is the first time I have ever given a tinker's da*n about her or her ideas, dont have any respect for her but many are saying the same thing today.

    I know, and I hope (none / 0) (#31)
    by NYShooter on Wed Mar 18, 2009 at 05:14:51 PM EST
    you didn't take my comment as a criticism of you.

    Not at all (none / 0) (#45)
    by Amiss on Thu Mar 19, 2009 at 12:04:11 AM EST
    I should have been clearer in how I felt regarding her, it was really just shock for her to come out with anything that had ever crossed my mind, period. :)

    But, But... (2.00 / 0) (#27)
    by squeaky on Wed Mar 18, 2009 at 04:34:56 PM EST
    Her Huffington Post has been a remarkably progressive information-age trailblazer as our means and methods of gathering and dissemination news, facts and gossip continue to evolve as we enter the digital era.

    How could that be, didn't she support Obama over Hillary?

    No question in my mind, that is what this is about.


    You mean Summers? (none / 0) (#35)
    by MKS on Wed Mar 18, 2009 at 05:29:13 PM EST
    Yes, sorry (5.00 / 0) (#44)
    by Amiss on Thu Mar 19, 2009 at 12:00:41 AM EST
    Dodd said the Administration pushed (none / 0) (#36)
    by jbindc on Wed Mar 18, 2009 at 06:40:43 PM EST
    for the language

    Senate Banking committee Chairman Christopher Dodd told CNN Wednesday that he was responsible for language added to the federal stimulus bill to make sure that already-existing contracts for bonuses at companies receiving federal bailout money were honored.

    Dodd acknowledged his role in the change after a Treasury Department official told CNN the administration pushed for the language.

    Both Dodd and the official, who asked not to be named, said it was because administration officials were afraid the government would face numerous lawsuits without the new language.

    Glad to see Dodd got rid of that hairstyle that made him look like he was pretending to be a 20 year old surfer dude.