From Talking Points Memo:
Nearly two years after the Wall Street meltdown drove the U.S. economy to the brink of collapse, and forced the U.S. government to prop up major financial institutions with hundreds of billions of dollars, House Speaker Nancy Pelosi now claims that the Bush Administration prohibited its own top officials who were handling the emerging crisis from briefing Congress until a complete financial collapse was only hours away.
In little-noticed statements to reporters over the last few weeks, Pelosi has alleged that the Bush administration knew well in advance of its intervention that the financial crisis would hit, and that Congress would need to authorize a historic and unpopular bailout - but that top officials, including then-Treasury Secretary Henry Paulson, told her that they had been barred from briefing Congress about true extent of the crisis.
(bolding by diarist)
full article here:
A bit more from the article:
Lehman Brothers had just filed for bankruptcy four days earlier and the Federal Reserve had authorized the New York Fed to lend up to $85 billion to insurance giant AIG. That afternoon, she (Pelosi)called Paulson to ask for a full briefing the next morning.
"They said, 'That will be too late. That will be too late. Tomorrow morning, 9 o'clock will be too late,'" Pelosi recalled.
In a meeting that evening with Congressional leaders and staff, Paulson, Fed Chairman Ben Bernanke, and others offered a dire assessment, and made an appeal for intervention that ultimately resulted in TARP. Bernanke and Paulson beseeched the legislators to act quickly, warning that, the entire U.S. economy might collapse in days without rapid intervention. But Pelosi had a question. "I asked them, and said, 'Why am I calling you - why didn't you call me?," Pelosi said.
"Here's what they said. They said, 'We were not allowed to tell Congress, but since you called, we're going to answer your questions.'"
Pelosi offered no hints as to why the Bush administration would prohibit its top lieutenants from speaking up about the need for federal intervention.
This is a MASSIVE indictment of the Bush Administration. Not like we weren't already suspicious of the timing of the news back then - remember the awkward choreography of announcements coming from Paulson, Bush and eventually McCain's failtastic Campaign suspension. But to have our worst fears verified by none other than Nancy Pelosi is staggering news.
Kudos to her for finding a way to share it with the world. I wonder what will happen now that we know.
UPDATE 1: Also from Talking Points Memo - responses from Bushco people:
Michele Davis, spokeswoman for former Treasury Secretary Hank Paulson, now emails to say there was no pressure from the White House to keep crucial information about the looming financial crisis from Congress.
"[N]o one at Treasury ever felt in any way constrained by the White House from communicating with the Congress," she writes.
Tony Fratto, who served as Deputy Press Secretary to President George W. Bush, says Pelosi's claim is inaccurate. "No one was barred from briefing Congress," he emails. "Congressional leaders were briefed, at President Bush's direction, right after he was briefed.
Weak sauce, IMO.
full article here: