Why is NY AG Andrew Cuomo Doing Tim Geithner’s Job?

Friday, March 27, 2009

Let me begin by saying I’m a huge fan of New York AG Andrew Cuomo. I believe New York Gov. David Paterson made a grave political miscalculation by not appointing Cuomo to Hillary Clinton’s vacated senate seat. But the voters will get a chance to clean this problem up in 2010.

So, the news Thursday that Andrew Cuomo was widening his investigation of the American International Group (AIG) to examine whether its trading counterparties improperly received billions of dollars in government money came as no surprise. Cuomo is the very definition of a populist and I expect nothing else from him.

The counterparties under Cuomo’s microscope include Goldman Sachs, who received $12.9 billion, as well as Société Générale of France and Deutsche Bank of Germany, which receiving nearly $12 billion.

Cuomo said in a statement:

“Our investigation into corporate bonuses has led us to an investigation of the credit default swap contracts at A.I.G.. CDS contracts were at the heart of A.I.G.’s meltdown. The question is whether the contracts are being wound down properly and efficiently or whether they have become a vehicle for funneling billions in taxpayers dollars to capitalize banks all over the world.”

Other counterparties who received money from A.I.G. include Barclay’s Bank ($8.5 billion), Merril Lynch($6.8 billion), Bank of America ($5.2 billion), UBS ($5 billion), Citigroup (2.3 billion) and Wachovia ($1.5 billion).

While Andrew Cuomo deserves kudos for taking on some of the biggest, most powerful and influence players in the financial world, isn’t this really the job of President Obama’s financial and legal team? Namely, Treasury Secretary Tim Geithner, National Economic Council Larry Summers and Attorney General Eric Holder? However, in the last analysis, the onus of bringing accountability to AIG and its counterparties rests with Geithner, who once again has shown he would rather remain safely escounced in the shadows of the White House while a state attorney general performs the heavy lifting.

This entry was posted in AIG, Bailout, News, President Barack Obama, Tim Geithner and tagged , , , , , , . Bookmark the permalink.

6 Responses to Why is NY AG Andrew Cuomo Doing Tim Geithner’s Job?

  1. libhomo says:

    The banksters’ double dipping of bailout money is a very important issue. Thanks for bringing it up.

  2. Adirondacky says:

    I wondered the very same thing and I concluded it’s because Geithner is part of the club. Remember, he’s the former president of the New York Federal Reserve Bank and you can’t get much more inside than this. Last September, Geithner worked with Bush’s financial team to get the AIG executive bonus provisions added — not removed, from the TARP. Geithner is part of the problem.

  3. TOM339 says:

    Look at the announcement that 15 of the 20 largest AIG bonuses would be returned? Who was the grease behind the effort?

    Andrew Cuomo. Not Tim Geithner.

    I don’t think Geithner is a bad or evil man. He’s just one of the players which makes him the wrong man to serve in the Obama administration.

    Trust me. The markets are up and he’s enjoying a new found respect but, the bloom will be off the rose very soon and this will mean new calls for his resignation.

  4. Big Hank says:

    Cuomo is a tough son of a bitch, who seems to thrive when faced with a challenge.

    Geithner by contrast, seems over his head and not quite up to the task.

  5. Rachel says:

    Great piece, Christopher. I agree on both of your main points: 1. Paterson screwed up bigtime by not appointing Cuomo to fill Hillary’s seat and now Paterson will face the voter’s wrath in 2010, and 2. Cuomo is doing cabinet level work by going after AIG. A job Obama’s economic team should be doing. Maybe I slept through things but until Obama asked Geithner to head-up Treasury, I had never heard of the man. I was neutral and trusted Obama on the nomination. So far, I think Obama made a mistake and Geithner has become a real albatross.

  6. actually i think this is the job of Eric Holder – and any other state AGs where AIG is doing business — which would be all 50.

    cuomo is great –

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