Tom Donilon / AP
National Security Adviser Tom Donilon collected more than $148,000 in pension payments from bailed out mortgage giant Fannie Mae in 2011, on top of his White House salary of $172,200, according to a Free Beacon analysis of White House personal financial disclosure forms.
Donilon netted more than $320,000 in income in 2011 between the two taxpayer-funded sources, including monthly payments totaling $12,391 as part of Fannie Mae’s “Executive Pension” and “Qualified Benefit” plans, the documents show.
“Most taxpayers are struggling to make ends meet. Yet, Mr. Donilon is still profiting from his work during the Fannie Mae buildup of the housing bubble that led to a recession and massive taxpayer bailouts,” said Sen. Jim DeMint (R., S.C.) in a statement to the Washington Free Beacon.
“We find it fairly unsurprising an Obama adviser is double-dipping the public coffers,” said Mattie Duppler, government affairs manager at American for Tax Reform. “After all, after trillion-dollar deficits for four years running, what’s a few hundred thousand?”
The optics of the arrangement were especially troubling, Duppler added, given that Donilon’s taxpayer-funded income is “three times what the average middle class taxpayer in making.”
A spokesperson for the National Security Council did not respond to questions about whether Donilon is still receiving Fannie Mae pension payments as of this year, and whether Donilon has participated in any discussions about the transfer of federal funds to Fannie Mae.
The firm played a significant role in the housing crisis of 2007, and the government-backed lender has since been bailed out with more than $120 billion in taxpayer funds. The total long-term costs of bailing out Fannie Mae and its affiliate entity Freddie Mac could range from about $400 billion to $1 trillion, according to independent estimates.
In November of 2011, as Donilon was continuing to collect pension payments from Fannie Mae, the lender requested another $8 billion in bailout funds to sustain ongoing losses. [Emphasis added]
Donilon is one of the wealthiest members of the Obama administration, with assets worth between $5.2 million and $32.5 million, according to personal financial disclosure forms.
The White House paid him a maximum salary of $172,200 in 2011—small potatoes compared with the $3.9 million he made in his previous position as a partner at O’Melveny & Myers LLP, where his clients included financial giants such as Citigroup and Goldman Sachs.
Donilon’s White House salary is also less than 10 percent of the $1.8 million in bonus packages he received from Fannie Mae before his departure in 2005.
Donilon’s role at Fannie as executive vice president for law and policy came under scrutiny in a 2006 report by the Office of Federal Housing Enterprise Oversight, which found that Fannie Mae lobbyists had sought to discredit federal regulators looking into the firm’s financial practices.
While Donilon was never accused of any wrongdoing, Fannie Mae was forced to pay a $400 million settlement to the federal government over charges the company inaccurately reported its earnings from 1998 to 2004.
A large portion of Donilon’s assets consists of municipal bond holdings worth between $3.6 million and $8.3 million.
Such investments are often exempt from federal and state taxes.
President Obama pledged, “Lobbyists won’t find a job in my White House” as a candidate in 2008—a claim the non-partisan watchdog website Politifact.com has rated a “promise broken.”
The president signed an executive order banning lobbyists from his administration, but the White House has approved a number of “waivers” to the rule. Donilon is one of at least 40 former lobbyists hired by the Obama administration since 2009, and was also a member of the Obama-Biden transition team. His name, however, does not appear on the list of White House officials granted waivers from the White House ethics pledge. [Emphasis added]
The controversy surrounding Donilon goes beyond his ties to Fannie Mae. Donilon has more experience in politics than he does in foreign policy, having worked on the presidential campaigns of Jimmy Carter, Walter Mondale, and Joe Biden, Politico noted in 2010.
Donilon’s predecessor Jim Jones once criticized Donilon for having “no credibility with the military,” according to Bob Woodward’s Obama’s Wars (2010). Former Defense Secretary Robert Gates reportedly said Donilon would be a “disaster” as national security adviser.
Donilon has also come under increased scrutiny as a potential culprit in the leak of highly classified national security information to reporters. He is quoted often in New York Times reporter David Sanger’s book Confront and Conceal: Obama’s Secrets Wars and Surprising Use of American Power, which reveals previously classified information about President Obama’s handling of the global war on terror.
Sanger’s book also reveals that Gates rebuked Donilon for divulging details to the press regarding the Special Forces raid that killed Osama bin Laden, reportedly telling the National Security Adviser to “shut the fuck up.”
Top lawmakers have called for an investigation into the leaks, which some say were meant to bolster the president’s foreign policy credentials in an election year. Democratic analyst Pat Caddell recently told Fox News’ Sean Hannity he thought Donilon was the source of the leaks.
“We owe it to the American people to get to the bottom of this national security threat,” said DeMint, who was one of 31 Senators to sign a letter to Attorney General Eric Holder demanding a special counsel to investigate the leaks.
Is National Security Adviser Tom Donilon the Source of the Administration’s Intel Leaks?
by Bryan Preston
June 26, 2012
Actually, we already knew this, sort of. The New York Times story on Obama’s drone kill list not only names Donilon, it includes an Oval Office photo with only three men in the picture: President Obama, counterterrorism adviser John O’Brennan, and Donilon.
The Times quotes Donilon on the record.
“He is determined that he will make these decisions about how far and wide these operations will go,” said Thomas E. Donilon, his national security adviser. “His view is that he’s responsible for the position of the United States in the world.” He added, “He’s determined to keep the tether pretty short.”
That story was not a leak, it was essentially an Obama campaign press release with posed photo constructed and released to show the president shedding any traces of Hamlet and flexing his national security muscle. It also showed him in a weird bind, as the man who demagogued Gitmo, military tribunals and water boarding but is now ordering lethal strikes without trial. But we’re not supposed to notice that. We’re supposed to see the brooding young president looking at photos of terrorists and ordering them killed to protect us.
The thing is, though, Donilon is not the only source for that drone kill list story.
In interviews with The New York Times, three dozen of his current and former advisers described Mr. Obama’s evolution since taking on the role, without precedent in presidential history, of personally overseeing the shadow war with Al Qaeda.
That’s a lot of sources. They’re all talking. Like Donilon, they’re probably not just sources for this story. Some of them are probably sources for the cyber war story too. It’s clear from this exchange that the main source of that story is in the president’s inner national security circle.
At a tense meeting in the White House Situation Room within days of the worm’s “escape,” Mr. Obama, Vice President Joseph R. Biden Jr. and the director of the Central Intelligence Agency at the time, Leon E. Panetta, considered whether America’s most ambitious attempt to slow the progress of Iran’s nuclear efforts had been fatally compromised.
“Should we shut this thing down?” Mr. Obama asked, according to members of the president’s national security team who were in the room.
Told it was unclear how much the Iranians knew about the code, and offered evidence that it was still causing havoc, Mr. Obama decided that the cyberattacks should proceed. In the following weeks, the Natanz plant was hit by a newer version of the computer worm, and then another after that. The last of that series of attacks, a few weeks after Stuxnet was detected around the world, temporarily took out nearly 1,000 of the 5,000 centrifuges Iran had spinning at the time to purify uranium.
National Security Adviser Donilon would likely be present at such a meeting.
There’s not much of a mystery here, though there is a scandal. Obama is using national security the way he is using federal immigration law – as a weapon to be wielded in his re-election campaign. He is authorizing these “leaks” just as he authorized the “leak” of the SEAL Team 6 identities to Hollywood producers so they could make a Barack-got-Osama movie that was originally intended for release just a few weeks before the election.
Unfortunately, Obama knows that he won’t suffer any real legal damage from this scandal, at least not before November. Attorney General Holder won’t do anything meaningful. The Republicans can complain as loudly as they want, but Obama determined after the 2010 mid-terms that a divided Congress squared off against a lawless president is practically useless to stop him. Stopping him requires Senate majority leader Harry Reid to put country before party, and that just is not going to happen. [Emphasis added]
***Written by Bryan Preston***
Tom Donilon’s résumé: Policy, law and Fannie Mae
But one part of Donilon’s résumé that went unmentioned in the Rose Garden Friday — the six years he spent as a top executive of Fannie Mae at the height of the housing boom — made him a problematic choice for any Obama administration job that requires Senate confirmation.
Donilon left the firm as it was mired in an accounting scandal in 2005, three years before Fannie Mae’s spectacular collapse when the mortgage market imploded in 2008. Investigators never accused Donilon of wrongdoing in the accounting scandal, but Fannie ultimately paid $400 million to the federal government to settle charges that the company misstated its earnings from 1998 to 2004. The government sued three top Fannie Mae executives to recover millions in bonuses based on the allegedly falsified reports, but Donilon was not among them.
A former official who led one of the main investigations into Fannie Mae said Friday that Donilon didn’t play a role in the misstatements but tried to pressure lawmakers to derail the probe.
“He was in charge of the lobbyists. … That process involved using the Hill to rein in the regulators,” said Stephen Blumenthal, former acting director of the Office of Federal Housing Enterprise Oversight. “That was always Fannie Mae’s approach. And there’s no question that Congress played a major role in enabling Fannie Mae to escape regulation and avoid increasing their capital, which is what eventually killed the company.”
“I don’t think he was part of the problem, but he wasn’t part of the solution,” Blumenthal said. “Mr. Donilon was not a target of the investigation. … Was he an enabler? Absolutely.”
A 2006 report on the federal “special examination of Fannie Mae” is replete with references to Donilon, who worked at the firm from 1999 to April 2005, first as senior vice president and general counsel, and later as executive vice president for law and policy. The report quotes from a 2004 Donilon e-mail plotting efforts to resist federal regulators’ attempts to force changes in Fannie Mae’s executive structure.
“Do you have any sense of the basis on which the agency believes that it has the authority to mandate practices in this area, hard to believe they have a safety and soundness rationale. … We should speed up our work on the interaction between bank regulators and the SEC … Should we start working with the BRT [the Business Roundtable], Chamber [of Commerce], ABA [American Bankers Association] etc now?” Donilon wrote to a colleague.
The report also describes Donilon as part of a group of Fannie Mae execs who exchanged “scripts” in advance of meetings of Fannie Mae’s nominally independent compensation committee. [Emphasis added]