Fox News buries significance of its own scoop implicating Bush administration on AIG bonuses
Research ››› ››› JEREMY HOLDEN
In reporting on emails obtained by Fox Business Network revealing discussions involving the Treasury Department about AIG bonuses, Fox News' Jon Scott at no point noted that the emails implicate the Bush administration in approving a $40 billion bailout for AIG without requiring AIG to nullify its employee bonus contracts.
During the March 20 edition of Fox News' Happening Now, co-host Jon Scott and correspondent Brian Wilson discussed email documents obtained by Fox Business Network regarding the AIG bonus payments by referring generically to "when the White House knew" and "traffic between the Treasury Department and folks at AIG" about those bonuses. At no point did Scott and Wilson make clear that President Bush's administration was running "the White House" and "the Treasury Department" at the time that the "traffic" occurred. Nor did Scott or Wilson explain that the "traffic" concerning AIG's bonuses is significant because it preceded a November 25, 2008, stock-purchase agreement between the Bush Treasury Department and AIG through which the Bush Treasury Department injected billions of dollars in aid to AIG without requiring that the bonus contracts, which AIG had signed with employees, be nullified.
Scott teased an upcoming discussion by stating, "You think the outrage over those AIG bonuses couldn't get any worse? Wait till you hear what Fox Business documents show when the White House knew about a potential problem." During the subsequent report, Scott said to Wilson: "Connecticut Senator Chris Dodd [D-CT] put the language in the bill that allowed those AIG bonuses to go forward. He says he did so at the request of the Treasury Department. Anything new on that?" Wilson responded in part by stating that "there was a lot of traffic between the Treasury Department and folks at AIG and the Fed about the bonuses, and the concern about the bonuses and how it was going to be a sensitive issue "and that "we know enough that even back in September, when the first payments were being made, there was serious concern about this issue." But in generically referring to the "White House" and "Treasury Department," Scott and Wilson did not make clear that while Dodd has said the Obama Treasury Department asked him to limit a provision in the American Recovery and Reinvestment Act that restricted the ability of companies receiving money from the Troubled Asset Relief Program (TARP) to award bonuses, it was the Bush Treasury Department that was involved in the email "traffic" that FBN uncovered regarding employee bonuses and that it was the Bush Treasury Department that signed the November agreement giving AIG bailout funds while not requiring that it abrogate its employee bonus contracts.
On March 20 FoxBusiness.com reported that in a November 1, 2008, email, a Treasury Department official wrote, "Have your benefits team made any progress on the 'soft' issues, or heard anything from the fed [sic] on the bonus situation?' " The article further reported, "Despite their deliberations at the time, the Treasury and Fed officials, which were part of the Bush Administration, eventually decided to restrict compensation on just the top 75 company executives -- and some of them may still have received hefty bonuses." But in his Fox News report, Wilson did not make clear that the documents central to his report indicate that the Bush administration was aware of the employee retention bonuses prior entering into the November 25, 2008, stock-purchase agreement and signed the agreement without requiring that AIG nullify those contracts.
Indeed, Neil Barofsky, a Bush-appointed special inspector general for TARP, noted in March 19 testimony that the executive compensation section of the Treasury's TARP agreement with AIG limits compensation for "Senior Partners," including "all retention payments paid or payable to such Senior Partner under any retention arrangement between the Senior Partner and the Company for any period ending on or prior to March 31, 2010." But the agreement does not affect retention payments for other AIG employees.
A subsequent on-screen graphic asked, "AIG hurting Dems?"
From the March 20 edition of Fox News' Happening Now:
SCOTT: You think the outrage over those AIG bonuses couldn't get any worse? Wait till you hear what Fox Business documents show when the White House knew about a potential problem.
SCOTT: Connecticut Senator Chris Dodd put the language in the bill that allowed those AIG bonuses to go forward. He says he did so --
SCOTT: -- at the request of the Treasury Department. Anything new on that?
WILSON: Well, yes. Our good friends at the Fox Business Network, I mean, they did something that is called a FOIA request -- Freedom of Information Act -- and they said we want to know exactly what was going on at the Treasury Department when all of these billions of dollars were being handed out. And that has paid off in a lot of different ways and a lot of different stories.
One of the things that they have found is that there was a lot of traffic between the Treasury Department and folks at AIG and the Fed about the bonuses, and the concern about the bonuses and how it was going to be a sensitive issue. Now a lot of this information is redacted; we don't have the entire story there. Some of the information is being held back. But we know enough that even back in September, when the first payments were being made, there was serious concern about this issue.
So for folks to say, "Oh, we didn't know it was coming. We didn't know this was going to be an issue," is sort of disingenuous.