Thune aims at Fannie, Freddie bonuses, calls pay 'an outrage'

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Calling $13 million in executive bonuses budgeted at Fannie Mae and Freddie Mac “an outrage,” Sen. John Thune, R-S.D., introduced a bill Wednesday to keep those funds in the treasury.

“It’s hard to believe those agency executives felt they deserved those bonuses,” Thune said, citing $150 billion in taxpayer assistance shoveled to the mortgage agencies since 2008. “This will send the message that not only are those bonuses undeserved and highly inappropriate, but also they won’t happen again.”

Furthermore, Thune’s bill would cap salaries for executives at the government-backed financial agencies at what other federal financial regulators can be paid. The Federal Reserve chairman is paid about $275,000 per year, Thune said.

A House committee passed a similar bill in November.

Thune’s bill, co-sponsored by Sen. Mark Begich, D-Alaska, comes on the heels of a new investigation into allegations that Freddie Mac made financial bets against the very mortgage holders it is charged with helping. The two agencies were put into conservatorship after the financial crises of 2008.

“This addresses what to me is an outrage — paying out bonuses for bad performance and paying salary levels that are way out of whack with similar institutions,” Thune said. “It just violates the sense of fairness most Americans have.”

Thune’s comments came during a conference call with reporters that also touched on other issues.

Keystone XL pipeline

Thune joined more than 40 other senators in co-sponsoring a bill to require the approval of the Keystone XL pipeline project after the Obama administration did not approve the oil pipeline proposed to run from Canada to the Gulf Coast.

The White House had said a 60-day timeframe did not allow enough time to properly review the project. Thune told reporters that much time already has been spent evaluating the pipeline and, he contended, the 60-day deadline did not apply to rerouting the pipeline through environmentally sensitive areas in Nebraska.

“The Obama administration has spent over 1,200 days reviewing, analyzing, studying and scrutinizing this pipeline proposal,” Thune said. “This argument that there hasn’t been enough time to look at this is completely wrong.”

Thune said the country stands to lose out on 700 billion barrels of oil and thousands of jobs if TransCanada develops the infrastructure to send the oil to Asia.

Ellsworth Air Force

Thune said that, while members of Congress work to avert $500 billion in looming defense cuts, Ellsworth Air Force Base is well-positioned should those cuts come to pass.

“Ellsworth Air Force Base has an awful lot going for it,” Thune said, citing a training range and a pending mission for unmanned aerial vehicles. The military is turning more and more to the unmanned aircraft, what Thune called “remotely piloted aircraft.”

The personnel flying those aircraft will be at Ellsworth later this spring, although the aircraft are not set to fly over South Dakota airspace initially, he said.

Furthermore, Thune said the long range of the B-1B bombers will bode well if bases and other military installations around the globe are shuttered.

“If you don’t have bases and aircraft carriers around the world, you need the capability to go long distances. Range is something the bombers really bring,” Thune said. “The B-1 bombers have performed extremely well providing close air support in Iraq and Afghanistan.”

Still, given the current budget situation, Thune said Ellsworth is as vulnerable to closure as any other base.

“When you start talking about $1 trillion in cuts, you have to be prepared to talk about anything,” Thune said, talking about one round of cuts already under way and the second proposed round of cuts he hopes to avoid.

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