McCain appears wrong on Fannie pay
Posted: Friday, September 19, 2008 4:43 PM by Mark Murray
Filed Under:
Economy
From NBC's Mark Murray and NBC/NJ's Adam Aigner-Treworgy
On the campaign trail in Minnesota today, McCain incorrectly suggested that the executive pay that former Fannie Mae CEOs Frank Raines and Jim Johnson earned came from taxpayers.
"That same executive got $21 million of your money," McCain said of Johnson. "And the other CEO, another supporter of Senator Obama, Mr. Raines got $25 million of your money. Let's tell them to give it back. Let's tell them to give it back."
Lucian Bebchuk of Harvard Law School, an expert on corporate governance, confirmed to First Read that Fannie Mae and Freddie Mac were private companies until being recently taken over by the federal government (which came after Raines' and Johnson's tenures).
Bebchuk said that maybe McCain was referring to past Fannie shareholders in the audience when he asserted that the executive compensation was "your money." Or perhaps McCain was making the point -- very loosely -- that now the federal government has taken over Fannie, any money that Raines or Johnson received is money taxpayers no longer have. But both assertions, he said, would be stretches.
Rich Ferlauto, the director of corporate governance and pension investment at the American Federation of State, County, and Municipal Employees -- a union which has endorsed Obama in the presidential contest -- was more blunt about Raines' and Johnson's compensation
"It was not taxpayer money," he said. "It was shareholder money."
