Ali Velshi interviews Tim Geithner…

Ali Velshi will be interviewing Treasury Secretary Tim Geithner during the 5pm hour of the Situation Room with Wolf Blitzer and 8pm during Campbell Brown No Bias, No Bull. Some highlights after the jump…

ON THE CONTINUING CONTROVERSY OVER THE AIG BONUSES:

VELSHI: There is some dispute as to who knew when what. AIG’s CEO said that you

might have known about this earlier than you did. When did you learn

about this and what did you learn?

GEITHNER: I was informed by my staff of the full scale of these specific

things on Tuesday, March 10th. And as soon as I heard about the full

scale of these things, we moved very actively to explore every possible

avenue — legal avenue to address this problem, to make sure that,

again, the assistance we were providing was not going to unduly benefit

these people.

And, you know, we moved very quickly. We’ve made it clear that the

payments going forward had to be renegotiated and we’re going to make

sure that the taxpayer is compensated for any payments we can’t recoup.

And we’re exploring all legal means to recoup those payments.

VELSHI: But you’re pretty certain on the advice that you’ve been given

that we can’t just legally not give these — or get any of these bonuses

back?

GEITHNER: Absolutely. That our best judgment at the time was we had no

legal ability to block a set (ph) of those payments, but those that we

had the capacity to affect, we insisted or renegotiated.

In any case, we’re going to go back and try to recoup the payments that

were already made we had no legal ability to block at that time.

VELSHI: As far as you can remember, though, you did not know about this

before March 10th?

GEITHNER: On Tuesday I was informed about the full scale and scope of

these specific bonus problems. And again, as soon as I did — but, you

know, it’s my responsibility, I was in a position where I didn’t know

about those sooner, I take full responsibility for that.

ON SENATOR DODD:

VELSHI: Let’s just talk a little moment again about those payments and

the legal ramifications of doing anything about it. Senator Dodd says

that he had a clause that was put into the stimulus bill that basically

allowed these payments to be made to people at AIG in this particular

unit and he says that somebody at Treasury asked him to put it in.

GEITHNER: Let me just start by saying that Chairman Dodd has played an

enormously important leadership role in this and he’s doing the right

thing in trying to make sure that the assistance we provide don’t go to

benefit people that shouldn’t benefit from these things. And I am

enormously impressed by the importance of what he’s trying to do in this

case.

VELSHI: But somebody – have we figured out who told him to put this

clause in?

GEITHNER: This provision? We expressed concern about this specific

version. We wanted to make sure it was strong enough to survive legal

challenge. But we also worked with him to strengthen the overall

framework and his bill has this very important provision we’re relying

on now to go back and see if we can recoup payments that were made that

there was no legal ability to block.

VELSHI: But inadvertently might somebody at Treasury have told Senator

Dodd to do something that has now resulted in these payments not being

able to …

GEITHNER: No, again, what we did is just express concern about the

vulnerability of a specific part of this provision, the legal challenge,

as you would expect us to do, that’s part of the legislative process,

but again, his bill also has this very important provision that allows

us to go back and see if we can recoup these payments and we’re going to

explore that, but in any case we’re going to make sure that the American

people are compensated for any payments we can recoup.

VELSHI: Do we know who in Treasury had this conversation with whomever

on the banking committee?

GEITHNER: Treasury staff were working Senator Dodd’s staff throughout

this process. Again, that’s part of the legislative process.

VELSHI: But you weren’t involved in that directly?

GEITHNER: I did have with other officials some conversations with

Chairman Dodd as he was going through this process but other provisions.

VELSHI: So not about this particular one. It wasn’t you telling …

GEITHNER: No, but I’m not sure that’s relevant because Treasury staff

did express concern about whether this provision was vulnerable to legal

challenge.

ON THE RECOVERY AND THE PLAN FOR THE BANKING INDUSTRY:

GEITHNER: We’ve already started to make sure that the banks have access

to the kind of capital they need to provide lending in a recession and

we’re going – you’ll see us move very quickly in the next few weeks to

lay out a plan to help deal with these real estate related assets that

are at the core of the financial system.

VELSHI: How much money do you think that’s going to take?

GEITHNER: You know, it’s …

VELSHI: The number 2 trillion is kind of out there.

GEITHNER: I wouldn’t look at those numbers. Again, the important thing

is the Congress has given us a substantial amount of resources and we’re

going to direct that where it’s going to be most effective in getting

credit flowing again. And you’re going to see us again continue to move

very, very quickly. This government has done more in weeks than you see

most governments do in months and years and that’s because of the depth

and severity of the problems we inherited and because, again, our

judgment is the quicker we move, the more aggressive we are, the quicker

we’re going to bring recovery back on track?

VELSHI: And when do you think we’ll start to see recovery?

Advertisement