It was a classic scene in a Congressional hearing on Wednesday, as top executives of housing giants Fannie Mae and Freddie Mac were skewered by lawmakers on a House panel, angered by big bonuses paid out to top officials.
“I understand the outrage,” said Freddie Mac CEO Ed Haldemann about bonuses and big salaries, though he then went on to defend big compensation packages to attract the talent needed to run his company.
“We must retain and recruit qualified executives and employees,” said Fannie Mae President Michael Williams.
Of course, that argument was much like serving up a hanging curveball to members of Congress, who are experts at finding ways to flog witnesses with a dash of populist outrage added in.
“What did you make in 2002?” asked Rep. Darrell Issa (R-CA) of the Fannie Mae chief, starting a line of questioning that was straight out of a class on how to zero in on witnesses at a Congressional hearing.
“What did I make in 2002? I don’t know,” said Williams of Fannie Mae, his voice growing quiet.
“Give me a year more than five years ago, what you made,” Issa persisted.
“Again, Congressman, off the top of my head, I don’t have that,” said Williams, looking a tad uncomfortable in the witness chair.
Then Issa went in for the rhetorical kill.
“I exactly remember the year I made over a million dollars,” said Issa with a big smile. “I’m sure you do.”
“What year did you first have compensation including bonus that put you over a million dollars?”
“Congressman, I’m not sure what year that was.”
“So, money’s not that important to you?” said Issa, full well knowing where he was going with this line of questioning.
“No, money is important to all of us who are here today,” the Fannie Mae chief replied in a quiet voice.
“You made $9.3 million the last two years while the President made $800,000,” said Issa. “You think that’s okay?”
The answers didn’t sit well with members of either party.
“You all come from a different world than I come from,” said the committee’s top Democrat, Rep. Elijah Cummings (D-MD).
“If I made a million dollars, I sure would know when I made it,” Cummings added.
It was just the start of some tough questions for the Fannie and Freddie executives, as they continue to ask Uncle Sam for billions in bailout aid.
They argued that if salaries and bonuses are cut, they won’t have the talent to run Fannie and Freddie, which will only lead to larger losses.
"I'm very disappointed this kind of pay is being given," said Rep. Dan Burton (R-IN), as both parties registered their frustration with a pair of companies that could well tap many billions in federal bailout dollars in coming years.
