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(Galatians 4:16)

Lawmakers Turn Fire on Obama Administration Over AIG Bonuses

Lawmakers outraged at bailed-out American International Group's move to pay $165 million in executive bonuses are turning their fire on the Obama administration, asking why top officials didn't act to prevent the pay-out earlier.Though President Obama pledged last month to crack down on executive pay for companies that take "exceptional" amounts of federal bailout money, the administration now seems to be struggling to take action to retrieve the bonuses AIG says it is contractually obligated to pay.This, despite the fact the government, with its $170 billion in assistance, holds about an 80 percent stake in the company, and just pledged another $30 billion."It seems like they are an administration in disarray," House Minority Whip Eric Cantor, R-Va., said Tuesday.Sen. Richard Shelby, R-Ala., suggested Treasury Secretary Timothy Geithner does not have a handle on the AIG matter."We need to find out when these bonuses were approved and more than that, when they were contracted for. And who knew this?" said the ranking Republican on the Senate Banking, Housing and Urban Affairs Committee."Did Secretary Geithner know and look the other way?"The senator, a harsh critic of the Treasury's bailout program known by its acronym "TARP," or Troubled Assets Relief Program, said members who voted for the program bear some blame, but he put much of the fault at Geithner's feet."There's either competence or incompetence going on here, and it looks like a lot of incompetence," Shelby said, adding: "I think this is the tip of the iceberg.""I think Secretary Geithner does not have his hands around the details of this, and if he does, then there's a lot more questions to be asked," he said.Shelby, interviewed on CBS' "Early Show," raised the possibility of resignation, saying: "I don't know if he should resign over this. That's up to-you know, he works for the president of the United States."Outrage continues to spread through the halls of Congress, as members' offices are inundated with calls from angry constituents. The Federal Reserve as well as the Treasury Department are coming under a harsh spotlight, since both gave taxpayer dollars to AIG (though the majority of the funding came from the Fed).White House Press Secretary Robert Gibbs was peppered with questions at his daily briefing Monday on why the administration didn't act earlier-like when it was offering another $30 billion to the company in early March.Gibbs said, "Based on what I read in the newspaper," the administration learned about the bonuses last week.Sen. Chris Dodd, chairman of the Senate banking panel, is calling for a full briefing from both the Federal Reserve and the Treasury on exactly why so-called retention bonuses were paid to executives in the wing of AIG that is said to have brought the mega-insurer to its knees and helped push the global economy to the brink of disaster."Why wasn't the Fed putting conditionality four different times they provided resources to AIG?" asked Dodd, who included in the $787 billion stimulus package an "exception for contractually obligated bonuses agreed on before Feb. 11, 2009."
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