Stammering Hank Paulson and Tim "Dead Man Talking" Geithner couldn't wait to get out of the witness chair yesterday when they appeared before the House Oversight Committee.
The former and current Treasury secretaries were grilled separately, in one of the few bipartisan events since President Obama took office.
Not a single member of either political party cut these two guys any slack. As we used to say in Brooklyn, Paulson and Geithner got their asses kicked.
Isn't it amazing how a little fear of losing an election can snap even the laziest politicians into action?
As a matter of course, one congressman yesterday brought up Geithner's past tax troubles. And everyone mentioned the apparent conflict of interest that occurred when AIG was bailed out by taxpayers and Goldman Sachs -- Paulson's old firm -- just happened to score enormous benefits.
At one point, Paulson was asked to stay for an additional eight minutes of questioning. When the clock hit 10 minutes, Paulson asked to be excused like he suddenly had a bathroom emergency.
But Paulson and Geithner were very lucky that their interrogators really didn't know what they were doing, so they took their inquisition down a dead end.
What do I mean? The main line of questioning is about AIG, the insurance company that invested in risky stuff and needed taxpayers to save its behind.
Not only did companies like Goldman, which invested on the other side of AIG trades, get all of their money back, but it turns out the New York Fed decided to keep details of the deals secret.
That's all very interesting stuff. The problem is, Paulson and Geithner have an easy explanation that they invoked over and over.
At various times the two either proclaimed that they weren't the ones who negotiated the AIG deal or -- and this is the real winner -- the whole freakin' financial world would have fallen apart if the AIG bailout hadn't occurred.
In other words, Paulson and Geithner were saying: Why are you people bothering us? You should be giving us a ticker-tape parade.
"If, if, if, if AIG had failed, with the system as fragile as it was, I believe it would have taken down the whole financial system and the economy," Paulson said at one point. And in case that didn't frighten you enough, Paulson was nice enough to provide threatening numbers -- 25 percent unemployment instead of the current 10 percent and housing prices "much lower" than they are today.
"This would have been an economic nightmare," Paulson said.
The best anyone could say about Geithner's performance is that he didn't start crying when one member of the committee accused him of being a politician and another cut him short by repeating, "you've answered the question, you've answered the question."
AIG is a dead end. The culprits can argue that they were under a lot of pressure and even if mistakes were made, they were honest ones.
But there's nothing honest about Paulson's habit of phoning up friends on Wall Street when he got the itch. There is nothing Paulson and someone like Lloyd Blankfein, his successor at Goldman, could have spoken about -- six times, for instance, on Sept. 18, 2008 -- that would not have been inside information.
If others are prosecuted for having information that the public doesn't, why is it that Goldman had a hot line to the Treasury?
Was this very profitable financial institution suddenly invested with certain quasi-government powers?
If you look through Paulson's phone logs, there are dozens upon dozens of calls made between Blankfein and Paulson during the latter's tenure as Treasury secretary.
And those calls don't even include ones likely made on cell phones. One congressman said during yesterday's hearing that Geithner also made hundreds of calls to Goldman Sachs during the AIG timeframe. Or, as he put it, 103 calls to Goldman and 100 calls to Fed Chairman Ben Bernanke.
I'd be shocked if Tim Geithner, lasts much longer as Treasury Secretary.
His mouth keeps moving, but Geithner continues to say incredibly stupid things -- like, insisting again yesterday that he in herited today's financial problems when in fact he was head of the New York Fed when this mess started. john.crudele@nypost.com
No comments:
Post a Comment