This morning Senator John McCain cited two past executives of Fannie Mae in his criticism of Barack Obama. They symbolize the first level of failure in the mortgage debacle, that of management. The public knows their name and some are aware of their aggressive accounting practices, which maximized their executive incentive compensation. Incentive pay is different than the golden parachutes, the compensation McCain currently berates.
Who structured the large management bribes, otherwise known as pay for performance? Who gave Jim Johnson and Franklin Raines those cush retirement agreements? The Board of Fannie Mae, the second level of failure. For years the Board approved management strategy, accepted the annual financial audit performed by professional accounting firms, and worked with leadership they hired, evaluated and rewarded. None of these names were mentioned by Mr. McCain.
Yet, one should have been, Kenneth Duberstein. Ken served on Fannie Mae's board from 1998 to 2007, through both the Raines and Johnson debacles and golden parachutes. (Ken also serves as Boeing's Chair of their Board level Compensation Committee.) The Fannie Mae Chair had this to say of Mr. Duberstein's retirement from the board:
Fannie Mae Chairman Stephen Ashley praised Duberstein for his "valuable strategic counsel, leadership and service."
Yes, the valuable strategic counsel, leadership and service that led to the implosion of the company. Duberstein not only served on the Board, his consulting firm advised Fannie Mae on regulatory matters, netting over $1,000,000 in fees over a three year period.
So what's the relationship to McCain? Ken helped John evaluate his chances for President in 2000. Newsweek shared what Ken did for John eight years ago:
Duberstein offered contacts (his corporate clients include Goldman Sachs and General Motors) as well as sage advice. He began to quietly expose McCain to corporate bigwigs (and potential campaign donors), hosting a breakfast for 25 business leaders with Henry Kissinger in New York that December.
Ken has a long history of Republican service. In the 1984 Republican National Convention he crawled onto the stage behind George Herbert Walker Bush to pull his pants leg. Just as John McCain is pulling ours now.
The third level of failure is government oversight. McCain has a twenty six year record of opposing the most basic regulations. Republicans are sprinting from their record. Duberstein even removed his nine year Fannie Mae governance from his biography. You won't know McCain's tainted team member names.
Who structured the large management bribes, otherwise known as pay for performance? Who gave Jim Johnson and Franklin Raines those cush retirement agreements? The Board of Fannie Mae, the second level of failure. For years the Board approved management strategy, accepted the annual financial audit performed by professional accounting firms, and worked with leadership they hired, evaluated and rewarded. None of these names were mentioned by Mr. McCain.
Yet, one should have been, Kenneth Duberstein. Ken served on Fannie Mae's board from 1998 to 2007, through both the Raines and Johnson debacles and golden parachutes. (Ken also serves as Boeing's Chair of their Board level Compensation Committee.) The Fannie Mae Chair had this to say of Mr. Duberstein's retirement from the board:
Fannie Mae Chairman Stephen Ashley praised Duberstein for his "valuable strategic counsel, leadership and service."
Yes, the valuable strategic counsel, leadership and service that led to the implosion of the company. Duberstein not only served on the Board, his consulting firm advised Fannie Mae on regulatory matters, netting over $1,000,000 in fees over a three year period.
So what's the relationship to McCain? Ken helped John evaluate his chances for President in 2000. Newsweek shared what Ken did for John eight years ago:
Duberstein offered contacts (his corporate clients include Goldman Sachs and General Motors) as well as sage advice. He began to quietly expose McCain to corporate bigwigs (and potential campaign donors), hosting a breakfast for 25 business leaders with Henry Kissinger in New York that December.
Ken has a long history of Republican service. In the 1984 Republican National Convention he crawled onto the stage behind George Herbert Walker Bush to pull his pants leg. Just as John McCain is pulling ours now.
The third level of failure is government oversight. McCain has a twenty six year record of opposing the most basic regulations. Republicans are sprinting from their record. Duberstein even removed his nine year Fannie Mae governance from his biography. You won't know McCain's tainted team member names.
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