While the administration regularly takes Wall Street to task for what it calls excessive bonuses, especially to companies bailed out by taxpayer money, it has been relatively silent about the bonuses approved by its own Federal Housing Finance Agency for two quasi-government companies at the center of the housing market meltdown:
The Federal Housing Finance Agency, the government regulator for Fannie and Freddie, approved $12.79 million in bonus pay after 10 executives from the two government-sponsored corporations last year met modest performance targets tied to modifying mortgages in jeopardy of foreclosure.
Remember AIG and the huge uproar over the bonuses they were contractually bound to pay soon after the bailout? Well these bonuses weren’t wrapped up in any contractual binding. These have been approved since that time. And to top it off, on average, they’re larger bonuses than AIG paid.
You’d think the FHFA would have a clue, wouldn’t you? You’d think they’d understand the “optics” of this sort of a payout of taxpayer money, not to mention that the government is supposedly trying to cut spending.
But obviously they don’t understand that.
Thankfully the Congress has thus far reacted to the situation in a swift and positive manner (for once):
The House Financial Services Committee, responding to lawmaker anger over compensation at Fannie Mae and Freddie Mac, approved a measure that would suspend the compensation packages for executive officers at the companies. The bill also would require employees of the two firms to be moved onto a pay scale that lines up with federal financial regulators including the Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency.
“Awarding lavish pay packages to the heads of these companies that have accepted $170 billion in taxpayer cash can’t be defended,” Representative Spencer Bachus of Alabama, the panel’s chairman and sponsor of the bill, said today.
We will see if they carry it on through and actually get something passed, but even Barney Frank, who initially opposed the bill is now supporting it. And when Freddie and Fannie have lost Barney, they’re in trouble:
Representative Barney Frank, the top Democrat on the Republican-controlled panel who initially opposed the measure, voted for the bill because of what he described as “insensitivity” by the companies in continuing to award bonuses.
“I had hoped that they would use restraint on their own because I think it’s better that we not intervene,” Frank, of Massachusetts, said today. “But they did not.”
Again, the “insensitivity” wasn’t something the companies did, although they likely requested the bonuses. It was the FHFA, a governmental agency, which approved the bonuses. It is business as usual among the bureaucrats who are obviously “insensitive” to the situation and continue to lavish taxpayers money where ever they decide it is deserved. If you want a clue as to why the federal government’s spending remains out of control, this is a good example.
Bureaucracies are forever it seems and they become the unaccountable drivers of government action. It is there which, if any meaningful reform is ever to be undertaken with shrinking the size and cost of government is to be done, where reformers must start.
Between screaming birthers, edited Constitutions and not-yet members of the House voting, the House of Representatives under GOP rule got off with some fits and starts.
However, there was something of note besides the mostly symbolic attempt to repeal ObamaCare (something that the CBO says would “cost” us about 230 billion – well at least until they further revise it down to nothing after it fails), something of actual importance seems to be emerging:
Dozens of Republicans used the opening day of the new Congress on Wednesday to introduce legislation that would bar the Environmental Protection Agency from regulating greenhouse-gas emissions.
48 Republicans and one Democrat (Boren- OK) are co-sponsoring the effort (that one Democrat makes it a “bi-partisan” effort under the definition of the term last Congressional session /sarc). Read the next part carefully:
The bill would amend the Clean Air Act to declare that greenhouse gases are not subject to the law, according to a brief description in the Congressional Record.
What that’s not saying is “greenhouse gases are not subject to the law” – it is saying greenhouse gases are not something that the Clean Air act has the jurisdiction to legislate. What Congress is trying to say to the EPA is “you stay out of the greenhouse gas business until we pass a law authorizing you to be in it”.
This is actually good news for the taxpayer. If passed it will prevent EPA from unilaterally imposing emissions standards and defacto taxes on emitters via fines and fees. The EPA’s primary targets would have been large emitters like power companies. And any “fees” charged would have gone directly to power customers. Effect? It would have hit those who can afford it least the hardest.
Of course, the other good news is the incoming GOP majority is less enthralled with the pseudo-science of climate change and thus less likely to impose economic penalties than was the former Congress. So we should see some backing away from the former trend of trying to tie energy and climate change together. Or as the Hill notes:
While GOP leadership’s specific legislative approach to attacking EPA remains to be seen, the quick introduction signals that blocking climate rules is plainly on the agenda for the new GOP majority.
That gets a hearty “good” from me.
This also signals – or at least I hope it does – some intent on the part of the House to do some regulatory oversight. You know, actually make the bureaucrats justify their regulations and their existence. If you want an area that is fat for reduction, many of the bureaucracies are a wonderful place to start.
Really – I want to know. Why did the “we’ve been on the job since day one” crowd take 70 more days to decide they should accept some offers of help that began coming in within 3 days of the spill.
(Via Hot Air):
The National Incident Command and the Federal On Scene Coordinator have determined that there is a resource need for boom and skimmers that can be met by offers of assistance from foreign governments and international bodies.
The United States will accept 22 offers of assistance from 12 countries and international bodies, including two high speed skimmers and fire containment boom from Japan. We are currently working out the particular modalities of delivering the offered assistance. Further details will be forthcoming once these arrangements are complete…
The Department has released a chart of offers of assistance that the U.S. has received from other governments and international bodies. The chart is updated as necessary to include any additional offers of assistance and decisions on accepting the offers.
The chart shows a good number of more offers still under “consideration”.
Why isn’t that equipment and technology already here and deployed?
What is going on with the “day one” crowd? Why are we still screwing around deciding what offers should or shouldn’t be accepted?
Meanwhile, the red tape continues to stymie efforts to clean up the spill.
This vid sort of sums it all up.