Featured Article


Dodd Says Treasury Department Asked for Loophole Legislation
Article Audio

1:50 minutes (0.88 MB)
Download this Article
Share this Content

Senator Christopher Dodd held a conference call with Connecticut reporters only Thursday afternoon to clarify his past comments on why changes were made  to legislation that allowed AIG to hand out controversial bonuses.

His staff was quick to point out that Treasury Secretary Timothy Geithner has told CNN he asked Dodd, as Chair of the Banking Committee, to include the loophole.  Geithner has said the Treasury was concerned that the government would face lawsuits if bonus contracts were breached.  And Dodd says that's what the Treasury staff told him six weeks ago.

"It was their idea, they came to us with it. it seemed more technical in nature than anything else. no connection whatsoever with AIG and we agreed to those changes."

Dodd provided further explanation of his comments to CNN on Tuesday when he originally said he was not a member of the conference committee when the final compromise bill was written that included the loophole language.  He also says he hopes Geithner's admission Thursday clarifies the public's impression.

"I gather that it's been cleared up to some degree which I appreciate it but I would have appreciated it earlier."

Geithner's recent statements now put him under a microscope considering that before being appointed to the Treasury he was the President of the Federal Reserve Bank and helped write the bailout plan for AIG last fall. Dodd stopped short of saying Geithner should resign.

"No, I don't think so.  Look, I can't think of an example historically where anyone has come into that job except in March of 1933 where as many problems have been thrown into an individual's lap over the last two months. He has the President's support and he has mine at this point. Obviously this is a matter that should have been handled differently but we are where we are."

Dodd says he supports a tax surcharge on the bonuses so the government can get the money back but his preference is that AIG employees, both past and present, give the money back voluntarily.