Update at bottom: Dem Congressman tears into Geithner: ‘It makes me doubt your commitment to the American people’; NY Times notes “liberals and conservatives alike, took turns hectoring”
WASHINGTON — US Treasury Secretary Timothy Geithner told lawmakers Wednesday he acted properly in the 2008 bailout of AIG and the subsequent disclosure of payouts from the insurance giant to major banks.
Geithner, facing increasing heat over his role in the bailout when he was president of the New York Federal Reserve, said the actions were aimed at financial stability and that authorities “did not act to help foreign banks.”
“Congress granted the Federal Reserve emergency authority precisely so that the government had some capacity to act to contain a systemic financial crisis,” he said in testimony prepared for delivery to a congressional panel.
“Not to have used that authority at that time would have been deeply irresponsible.”
Geithner also maintained that he was not involved in a decision to withhold information about AIG’s payouts that some have called a “backdoor bailout” of those firms including Goldman Sachs and a number of foreign banks.
“I had no role in making decisions regarding what to disclose about the specific financial terms of… payments to AIGs counterparties,” he said.
Overall, Geithner offered an impassioned defense of the role of the central bank and other authorities to resscue AIG in the face of what appeared to be a financial system meltdown in September 2008.
“We did not act because AIG asked for assistance,” he said.
“We did not act to protect the financial interests of individual institutions. We did not act to help foreign banks. We acted because the consequences of AIG failing at that time, in those circumstances, would have been catastrophic for our economy and for American families and businesses.”
Geithner’s remarks were prepared for delivery to the House of Representatives Government Oversight Committee on his role — when he was president of the New York Federal Reserve — in the controversial AIG bailout.
The Fed provided a loan of 85 billion dollars to AIG in September 2008 in what would be the first portion of a staggering bailout worth some 180 billion dollars.
Fed chairman Ben Bernanke, who has also taken heat over AIG and his economic stewardship, has welcomed congressional efforts to look into the AIG bailout.
As the New York Times reports, “Throughout the morning, Mr. Geithner tried to persuade lawmakers that the government acted ‘in the best interests of the American people,’ and not in the interests of big banks, in particular, as many lawmakers asserted, Goldman Sachs. Mr. Geithner, while keeping his composure throughout the questions, was also forceful in defending his position.”
“I think the commitment to Goldman Sachs trumped the responsibility that our officials had to the American people,” Representative Stephen F. Lynch, Democrat of Massachusetts, told Mr. Geithner. His voice rising, his finger pointed at Mr. Geithner, Mr. Lynch told Mr. Geithner: “It stinks to the high heavens what happened here. I don’t like the obfuscation. And to top it all off, the disclosure was not there.”
Lynch said, “It makes me doubt your commitment to the American people.”
The Times adds, “Members of both parties, liberals and conservatives alike, took turns hectoring Mr. Geithner. At times, the hearing took on a scolding, even berating, tone.”
The following video was posted to YouTube by The Financial Dope blog:
‘America is running away like rats’: Watch angry Kurds blame US troops for dead babies as they withdraw
The Associated Press obtained video of Kurds pelting American military vehicles with fruit as they withdrew from Syria.
The video was first captured by a Kurdish news agency, the AP said in a report on Monday.
“Like rats, America is running away,” one man shouted in Arabic. Another shouted obscenities and talked of babies in Kurdish-held Syria who had died in the Turkish offensive.
The scene encapsulated the Kurds’ feelings of betrayal and added a new indignity to a US withdrawal that has been rushed and involved several close brushes with Turkish-backed forces.
Julián Castro says his campaign is ‘in dire need’ of funds – and he’s out if he can’t raise $800K in ten days
Julián Castro says he will have to pull out of the Democratic presidential primary if he does not raise $800,000 in the next ten days. Castro, a former HUD Secretary, says he will be forced to stop campaigning if he does not reach his financial goals by the end of the month.
“The truth is, for our campaign, these debates have offered our only guaranteed opportunity to share my vision with the American people,” Castro said in an email to supporters, as Buzzfeed reports.
Legal scholar exposes the absolutely bonkers ‘missing link’ in Rudy Giuliani’s Ukraine conspiracy theory
Ryan Goodman, a professor at New York University School of Law, has written a new article with NYU colleague Alex Potcovaru exposing the direct link between President Donald Trump's request to investigate former Vice President Joe Biden and to investigate a debunked conspiracy theory pinning the blame on Ukraine for interfering in the 2016 presidential election.
Writing at Just Security, Goodman and Potcovaru examine past statements made by Giuliani both on cable news shows and on social media, and have discovered that Giuliani's efforts to get Ukraine to probe the 2016 election are also an effort to dig up dirt on former Vice President Joe Biden.