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OpEdNews Op Eds    H1'ed 11/3/09

CIT Bankruptcy: Taxpayers Stiffed on Company's Bailout Billions While Execs Reap Bonuses

Author 37160
Message Harkavy

Reprinted from The Smart Asset

CIT CEO Jeff Peek and wife Liz

If people were pissed off about AIG's temporary decline and permanent bonuses, CIT's bankruptcy ought to enrage them.

The giant lender to businesses is heading for a quick in-and-out in bankruptcy court, and when it emerges, taxpayers will be the ones who have gotten the ol' in-out: CIT won't have to repay its $2.33 billion TARP bailout.

CIT's been in deep trouble for way more than a year. Meanwhile, some of its execs have reaped special bonuses. Its H.R. director, Jim Duffy, has received a $450,000 cash bonus for what the company called his "exceptional performance." What did he do? "Mr. Duffy's achievements in 2008 include the design and implementation of a process to reduce our total headcount by 22% ... along with the successful deployment of talent and development programs targeted at retaining CIT's key talent," according to CIT's proxy filing last April. That message to taxpayers was approved by CEO Jeff Peek.

That was the same month that Peek's wife, Liz Peek (a former journalist), wrote an anonymous, weepy tell-all for Portfolio about the sad plight of TARP wives. And that was the same month that Portfolio itself went out of business.

Liz Peek acknowledged in her sob story that even her husband had to take some of the blame for last year's Wall Street tsunami, though she continued the canard that the Street's execs didn't see the tusanimi coming Ś as if it were a natural disaster instead of a manmade one.

After naming only a few humans who might have had something to do with it, she added:

And yes, I blame those who were in charge of the big banks--including my husband--for not seeing the default tsunami coming. But almost no one did. Everyone knows this, yet financial CEOs have replaced the Mob as the most despised group in the country.

The good news is that Americans have short attention spans. Before long, some other group will come along to absorb all the frustration and anger.


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Ward Harkavy is currently Senior Editor at the Village Voice, for which he writes The Smart Asset.
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