Eric Dash, New York Times, February 5, 2009
"Country club dues, gym memberships and personal assistants. Home security systems, chauffeur service and parking. And, of course, all those private jets to ensure the comfort and safety of the boss. Top executives at banks enjoy all sorts of shiny perquisites. Yet despite being propped up by taxpayer bailout money, many banks are not yet ready to give them up....
"Of 200 of the largest publicly traded banks that have received taxpayer money, about 61 percent, or 121 banks, paid an average of $10,835 in country club dues for their chief executive in 2007.
"Nearly three-quarters, or 147 banks, spent an average of $20,668 in car and parking expenses. Corporate jets, now one of the biggest targets of Washington’s ire, were financed by 36 banks, or 18 percent of those now receiving taxpayer funds. More often than not, the banks let their leaders use the corporate jet for personal travel, at an average cost of $102,216. And regardless of size, many banks said they were 'required' for the safety of the chief executive."
Matthew Benjamin and Christine Harper, Bloomberg News, February 5, 2009
"Executives at Goldman Sachs Group Inc., JPMorgan Chase & Co. and hundreds of financial institutions receiving federal aid aren’t likely to be affected by pay restrictions announced yesterday by President Barack Obama.
"The rules, created in response to growing public anger about the record bonuses the financial industry doled out last year, will apply only to top executives at companies that need “exceptional” assistance in the future. The limits aren’t retroactive, meaning firms that have already taken government money won’t be subject to the restrictions unless they have to come back for more....
"In addition, some executives may be compensated for the potential reduced salaries with restricted stock grants, which may result in huge paydays after the bank repays the government assistance with interest. 'They’re just allowing companies to defer compensation,' said Graef Crystal, a former compensation consultant and author of 'The Crystal Report on Executive Compensation.' The restrictions are 'a joke,' he said, because 'if the government is paid pack, you can be sure that the stock will have risen hugely.'"
Josh Fineman and Danielle Sessa, Bloomberg News, February 5, 2009
"Citigroup Inc., targeted by lawmakers for paying $400 million to put its name on the New York Mets’ new ballpark, and seven other banks that received government funds may face questioning by Congress for spending $845 million on stadium sponsorships.
"Bank of America Corp., which like Citigroup received $45 billion in government funds, is paying $140 million to have its name on football’s Carolina Panthers stadium. JPMorgan Chase & Co., which received $25 billion from the Troubled Asset Relief Program, is spending $66 million for branding Chase Field in Phoenix, home to baseball’s Arizona Diamondbacks."
Reuters, Reuters, February 4, 2009
"Banks, automakers and other companies that have received U.S. bailout money spent $114 million on lobbying and campaign contributions last year, a watchdog group said on Wednesday. The Center for Responsive Politics said that amounted to a healthy return on investment for companies such as Bank of America and General Motors that were among those that received a total of $295 billion in federal support. "Even in the best economic times, you won't find an investment with a greater payoff than what these companies have been getting," executive director Sheila Krumholz said in a statement.
"Roughly 350 companies have gotten payouts under the government's $700 billion bailout program. Of those, 25 spent a total of $76.7 million on lobbying, the watchdog group said. Lobbying activity declined in the fourth quarter, when the bailout efforts were approved, as the companies felt the effects of the global recession."
See Also: Center for Responsive Politic's Report
Greg Miller, Los Angeles Times, February 1, 2009
"Under executive orders he issued last week, the CIA still has authority to carry out what are known as "renditions" – secret abductions and transfers of prisoners to countries that cooperate with the United States.
"Current and former U.S. intelligence officials said that the rendition program may play an expanded role because it is the main remaining mechanism – aside from Predator missile strikes – for taking suspected terrorists off the street."
Juliet O'Neill, CanWest News Service, January 23, 2009
"The federal government is considering the elimination of environmental assessments on all infrastructure projects of less than $10-million and reducing oversight on bigger projects, says a document leaked to the New Democratic Party. Linda Duncan, the NDP environment critic and an Edmonton MP, cited the document at a news conference Thursday, accusing the federal government of planning a "death blow" to federal environmental protection under the guise of speeding infrastructure projects to stimulate the economy....
"The document, an e-mail from within Environment Canada, says these "short-term measures" would be followed by a new Canadian Environmental Assessment Act, as soon as March or April, that would focus on major projects and co-ordinate federal-provincial procedures. Ms. Duncan said the Conservatives are looking for a way to avoid a required public review of the current law by 2010....
"Green Leader Elizabeth May said at a separate news conference that environmental assessments rarely delay projects and even more rarely halt them. She said improvements could be made to the assessment process "but gutting it under cover of the current economic crisis would be, in my mind, just as egregious as what they did in November." She was referring to the federal government's attempt to halt public funds for political parties and other measures in the economic statement that triggered turmoil and the suspension of Parliament."
Elizabeth Williamson and Brody Mullins, Wall Street Journal, January 23, 2009
"Troubled financial institutions and the Detroit auto makers continue to spend heavily on lobbying Congress while accepting billions of dollars in U.S. government money, reports to Congress suggest....
"Bank of America Corp., whose heavy losses prompted it to appeal to the government for a second bailout this month, spent $4.1 million on lobbying last year, nearly $1 million more than in 2007. The bank spent $820,000 on lobbying in the last quarter, about one-fifth less than in the third quarter. Bank of America is in line to receive a total of $45 billion from the government, including $20 billion committed by the Treasury this month....
"Congressional filings show that lobbying by American International Group, which the government took control of in September, continued in the fourth quarter, despite the government's holding 78.8% of the company. Congressional filings show that AIG spent $1.08 million in the fourth quarter. AIG's 2008 lobbying spending was $9.5 million, $1 million less than in 2007....
"In October, after the Wall Street Journal reported that AIG was lobbying states for more favorable interpretations of a law that would place new controls on mortgage originators, Sen. Feinstein and Republican Sen. Mel Martinez of Florida introduced legislation that would ban recipients of taxpayer money from lobbying. The two lawmakers are seeking sponsors for a House version of the bill."
Binyamin Appelbaum, Washington Post, January 22, 2009
"At least 30 banks since 2000 have escaped federal regulatory action by walking away from their federal regulators and moving under state supervision, taking advantage of a long-standing system that allows banks to choose between federal and state oversight, according to a Washington Post review of government records. The moves, known as charter conversions, highlight the tremendous leverage that banks hold in their relationships with government supervisors.
"Since 2000, about 240 banks have converted from federal to state charters. Regulators and bank executives say many of those institutions simply wanted to save money. While national charters allow banks to operate more easily across state lines, state charters are cheaper. State regulators also advertise their accessibility and say they better understand local conditions and concerns.
"But the pursuit of leniency is an important undercurrent. About 12 percent of the banks that moved to state charters escaped federal regulatory actions, and experts on bank oversight say such cases are the tip of a broader pattern. They note that some banks convert in anticipation of a public enforcement action, or after persuading federal regulators to terminate an action....
"'The whole framework of our system was set up at a different time in American history, and it's really much more a matter of history than logic,' said Eugene Ludwig, who served during the 1990s as Comptroller of the Currency, the chief regulator for national banks."
Eric Lipton and David D. Kirkpatrick, New York Times, December 29, 2008
"A tight-knit group of former senior government officials who were central players in the savings and loan bailout of the 1990s are seeking to capitalize on the latest economic meltdown, enjoying a surge in new business in their work now as private lawyers, investors and lobbyists.
"With $700 billion in bailout money up for grabs, and billions of dollars worth of bad debt or failed bank assets most likely headed for sale or auction, these former officials are helping their clients get a piece of the bailout money or the chance to buy, at fire-sale prices, some of the bank assets taken over by the federal government.
"'It is a good time to be me,' said John L. Douglas, a partner in Atlanta at the law firm Paul Hastings and a former lawyer for bank regulators who helped create the agency that administered the last federal bailout, the Resolution Trust Corporation.
"Some of these former federal officials, like L. William Seidman, the first chairman of the R.T.C., are serving as advisers — sharing ideas with Treasury Secretary Henry M. Paulson Jr. and the transition team for President-elect Barack Obama — even while they are separately directing investors or banks on how to best profit from this advice."
Frank Bass and Rita Beamish, Associated Press, December 22, 2008
"Banks that have their hands out in Washington this year were handing out multimillion-dollar rewards to their executives last year. The 116 banks that so far have received taxpayer dollars to boost them through the economic crisis gave their top tier of executives nearly $1.6 billion in salaries, bonuses and other benefits in 2007, an Associated Press analysis found.
"That amount, spread among the 600 highest paid bank executives, would cover the bailout money given to several banks that have shared in the $188 billion that Washington has doled out in rescue packages so far.
"Some banks trimmed their executive compensation in the face of faltering performance that foreshadowed the current economic crisis, but they still granted multimillion-dollar packages. Benefits included cash bonuses, stock options, personal use of company jets and chauffeurs, home security, country club memberships and professional money management, the AP review of federal securities documents found."