Yesterday, the panel overseeing bailout spending on behalf of Congress issued its latest hard-hitting report, which criticized the Treasury Department’s approach to the program and called for top execs at major banks to be fired.
But perhaps the most interesting thing about the report is the “alternative view” that accompanied it, from Republican panel member John Sununu.
Before we look at Sununu’s objections, a quick reminder: In February, TPMmuckraker reported that the former New Hampshire GOP senator has what appears to be a major conflict of interest: he sits on the board of a subsidiary to Bank of New York Mellon — a firm that both received TARP funds itself, and has contracted with the Treasury to help run the program. In an email to the Associated Press, which picked up on the story, Sununu said he didn’t see this as a conflict.
As we noted in our original report, Sununu from the start has taken a notably bank-friendly approach to his work on the panel. In February, he dissented from a previous panel report that took a hard line with Wall Street, instead recommending going far easier on the banks, and emphasizing the need to rein in Fannie Mae and Freddie Mac.
This time around is no different. In his latest dissent, Sununu seems primarily concerned to determine why banks might be choosing to decline TARP funds — the implication being that Treasury’s demands are overly burdensome. He asks:
What factors have driven roughly 200 financial institutions to decline CPP funding after their applications had been approved, and what implications does this have for the success of the program?
And:
To what extent has the recent debate and proposed legislation regarding taxation and limitation of executive compensation discouraged firms from participating in CAP, TALF, and the PPIP?
So let’s recap. The guy who sits on the board of a company affiliated with a bank that has both been bailed out, and administers the bailout program, thinks that the main problem with the bailout is that restrictions on executive pay have been too onerous on the banks.
Anyone else see anything wrong with this picture?