For months, the Obama administration and members of Congress have known that insurance giant AIG was getting ready to pay huge bonuses while living off government bailouts. It wasn't until the money was flowing and news was trickling out to the public that official Washington rose up in anger and vowed to yank the money back.
Why the sudden furor, just weeks after Barack Obama's team paid out $30 billion in additional aid to the company? So far, the administration has been unable to match its actions to Mr. Obama's tough rhetoric on executive compensation. And Congress has been unable or unwilling to restrict bonuses for bailout recipients, despite some lawmakers' repeated efforts to do so.
The situation has the White House and Treasury Secretary Timothy Geithner on the defensive. The administration was caught off guard Tuesday trying to explain why Geithner had waited until last Wednesday to call AIG chief executive Edward M. Liddy and demand that the bonus payments be restructured.
I don't know if he (Geithner) should resign over this," Sen. Richard Shelby, R-Ala., told CBS' The Early Show Tuesday, "But I can tell you, this is just another, you know, example of where he seems to be out of the loop."
Publicly, the White House expressed confidence in Geithner - but still made it clear he was the one responsible for how the matter was handled.
While administration officials insisted Tuesday that neither Mr. Obama nor Geithner learned of the impending bonus payments until last week, the problem wasn't new. AIG's plans to pay hundreds of millions of dollars were publicized last fall, when Congress started asking questions about expensive junkets the company had sponsored. A November SEC filing by the company details more than $469 million in "retention payments" to keep prized employees.
Back then, Rep. Elijah E. Cummings, D-Md., began pumping Liddy for information on the bonuses and pressing him to scale them back. "There was outrage brewing already," Cummings said. "I'm saying (to Liddy), 'Be a good citizen. ... Do something about this.'" - CBS Story
There is mounting evidence that the information about the AIG Bonuses was known for Months and nothing was done about it. Obama and his Administration are laying out claims that they only became aware last Thursday, but there has been evidence that it was public knowledge since September.
Why the sudden furor, just weeks after Barack Obama's team paid out $30 billion in additional aid to the company? So far, the administration has been unable to match its actions to Mr. Obama's tough rhetoric on executive compensation. And Congress has been unable or unwilling to restrict bonuses for bailout recipients, despite some lawmakers' repeated efforts to do so.
The situation has the White House and Treasury Secretary Timothy Geithner on the defensive. The administration was caught off guard Tuesday trying to explain why Geithner had waited until last Wednesday to call AIG chief executive Edward M. Liddy and demand that the bonus payments be restructured.
I don't know if he (Geithner) should resign over this," Sen. Richard Shelby, R-Ala., told CBS' The Early Show Tuesday, "But I can tell you, this is just another, you know, example of where he seems to be out of the loop."
Publicly, the White House expressed confidence in Geithner - but still made it clear he was the one responsible for how the matter was handled.
While administration officials insisted Tuesday that neither Mr. Obama nor Geithner learned of the impending bonus payments until last week, the problem wasn't new. AIG's plans to pay hundreds of millions of dollars were publicized last fall, when Congress started asking questions about expensive junkets the company had sponsored. A November SEC filing by the company details more than $469 million in "retention payments" to keep prized employees.
Back then, Rep. Elijah E. Cummings, D-Md., began pumping Liddy for information on the bonuses and pressing him to scale them back. "There was outrage brewing already," Cummings said. "I'm saying (to Liddy), 'Be a good citizen. ... Do something about this.'" - CBS Story
There is mounting evidence that the information about the AIG Bonuses was known for Months and nothing was done about it. Obama and his Administration are laying out claims that they only became aware last Thursday, but there has been evidence that it was public knowledge since September.
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