Democratic infighting over AIG Bonuses

As the House passed new legislation Thursday to crack down on the outrage-inspiring bonuses, Sen. Chris Dodd of Connecticut, the Banking Committee chairman, and Treasury Secretary Timothy Geithner engaged in finger-pointing about who was responsible for Congress' failure to prevent them in the first place.

Dodd, a five-term senator, was already facing a tough re-election contest in 2010. He says the Obama administration insisted he modify his proposal to rein in bonuses at companies getting billions of dollars in financial bailouts so that it would only apply to payments agreed to in the future — thus clearing the way for the AIG payouts.

It was that or have his executive pay limits dropped altogether from the $787 billion stimulus measure that passed last month, Dodd says.

He agreed to the changes "in order to preserve the amendment," Dodd told reporters Thursday. "They sought it; I didn't. They asked for the changes ... and so we agreed to those changes."

Geithner said Thursday that his staff merely pointed out that without the change, the government risked being sued by executives in line to get big bonuses from bailout recipients.

"What we did is just express concern about the vulnerability of a specific part of this provision, the legal challenge, as you would expect us to do. That's part of the legislative process," he told CNN.

The treasury chief also appeared to back away from the administration's previous assertion that Geithner first learned of the bonuses last week. Interviewed on CNN, Geithner said only that he "learned of the full scale and scope of these specific" bonus payments at that point.

Both men had positive things to say about each other despite the dispute over who watered down the bill. - FOX News Story

Either way, the prove is in the argument. They knew about the bonuses and did nothing about it until the public showed outrage. The new they were coming, both sides have different opinions about what they could do, so they did nothing. So don't sit up their on your pedestal and say you didn't know. You might not of known when, but you knew.