Perpetuating falsehood, Wall Street Journal's Fund claimed “AIG bonuses ... were in the stimulus bill”

Written by Jeremy Holden

Published

On Fox & Friends, John Fund advanced the Republican falsehood that Democrats created the right for AIG to pay bonuses by passing the economic recovery bill. In fact, the recovery bill did not create the right for AIG -- or any company -- to pay bonuses. Rather, AIG reportedly disclosed that it had entered into agreements to pay these bonuses more than a year ago, the Bush Treasury Department approved of the AIG bailout with this agreement in place, and the relevant provision in the recovery act actually restricted the ability of companies receiving money from TARP to award bonuses in the future.

During the March 23 edition of Fox News' Fox & Friends, Wall Street Journal columnist John Fund advanced the Republican falsehood that Democrats created the right for American International Group (AIG) to pay bonuses by passing the American Recovery and Reinvestment Act. Fund asked, “Do you really want to trust the same government that approved the AIG bonuses knowing that they were in the stimulus bill? ... Are you really going to trust that same government to be the overlord for executive compensation?” In fact, as Media Matters for America has repeatedly documented, the recovery bill did not create the right for AIG -- or any company -- to pay bonuses. Rather, AIG reportedly disclosed that it had entered into agreements to pay these bonuses more than a year ago, the Bush Treasury Department approved of the AIG bailout with this agreement in place, and the relevant provision in the recovery act actually restricted the ability of companies receiving money from the Troubled Asset Relief Program (TARP) to award bonuses in the future.

Media Matters has documented numerous other examples of media similarly misrepresenting the economic recovery bill's provision concerning executive compensation.

From the March 23 edition of Fox News' Fox & Friends:

K.T. McFARLAND (former GOP U.S. Senate candidate): The problem is, Wall Street has now moved to Washington. Goldman Sachs has left Wall Street, and they're now in Washington. And there is no Wall Street anymore; it's now run out of the Treasury Department. There's no free market, so all this notion of appropriate compensation for risks that they're taking -- that's just not going to happen anymore.

FUND: Do you really want to trust the same government that approved the AIG bonuses knowing that they were in the stimulus bill?

STEVE DOOCY (co-host): Right.

McFARLAND: Right.

FUND: And, by the way, no one read the stimulus bill --

McFARLAND: And tax-free, by the way.

FUND: -- but those who did knew it was in there. Are you really going to trust that same government to be the overlord for executive compensation?

DOOCY: Right.

FUND: Look, there is one thing worse than greedy Wall Street people, and that's Washington politicians who work for Wall Street people --

McFARLAND: Right.

FUND: -- trying to impose on them.

McFARLAND: Who take the bribes from Wall Street.