In AIG flap, it's not just about bonuses anymore

[Sub Atomic]

Source: L.A. Times

The firestorm over American International Group is spreading beyond executive bonuses, with lawmakers and policy experts now questioning virtually all aspects of the taxpayer-financed rescue package for the insurance giant.

Among other issues, critics are asking why AIG was allowed to use federal bailout money to repay $13 billion in debt obligations to Wall Street powerhouse Goldman Sachs, as well as debts to foreign banks.

Prominent Republicans, joined by some Democrats, suggested that the answer could be found in longtime ties linking Washington to Wall Street.

Former Treasury Secretary Henry M. Paulson was once chief executive of Goldman Sachs, for example, while AIG's chief executive, Edward M. Liddy, was a member of Goldman's board. The Treasury official who is in charge of the bailout, Neel Kashkari, is a former Goldman executive.

"Look at where the money went: Goldman Sachs, Paulson's firm, foreign banks," Sen. Jim Webb (D-Va.) said Wednesday. "AIG gave more money to foreign banks than we gave in loans to the auto industry."

...

Still, some critics on the left -- including organized labor officials and prominent House Democrats -- suggested that bailout decision-making to date had been sullied by a Wall Street bias afflicting both the current Treasury secretary and his predecessor.

"AIG was too well-connected to fail," said Rep. Brad Sherman (D-Sherman Oaks) during a contentious House hearing in which AIG's Liddy was grilled by lawmakers.

Read more: http://www.latimes.com/business/la-fi-aig-bailout19-2009mar19,0,2707699.story

[marshall]

1. Obama needs to just back away from this nightmare of a mess

No good will come from hanging this out everyday in news. Some way needs to be found to just put this entire thing to bed.

[elocs]

2. It needs to be decisively put to bed with as much authority as Obama can muster.

The entire nation is watching. Certainly this mess emanated from the Bush years, but there comes a time when Americans will expect more than the (legitimate) excuse of "it's not our fault".

[yurbud]

7. he needs to take some action to show Wall St. is our bitch not vice versa

[marylanddem]

3. Obama needs to show Summers & Geithner the door.

[peacebird]

4. "AIG was too well-connected to fail," time for Federal prosecutors to follow the money

and start putting some of those "connections" in jail.

[williesgirl]

5. Any of our money not already spent should be immediately returned to our Treasury. Not one more

fucking dime to any of these insurance companies, bank, corporations and other crooks. Let them file bankruptcy. Let bankruptcy judges and creditor committees fire all execs and find other so-far untainted (if that's even possible) to run the companies while in receivership.

How they could have allowed one dime of taxpayer money to go to foreign entities is mind blowing. Let their own countries bail them out as we had to do.

Pull back on all foreign aid that's not directly for humanitarianpurposes until we're back on our feet and at least have halved this fucking deficit.

It's time to circle the wagons and feed, clothe, house and provide medical care to our own for a change.

Flame away. It's just my heartfeld opinion.

[GOTV]

6. Obama needs to stop looking like a helpless victim ...

... We need to stop hearing "Whoa, how did that happen? How did that get there? What are we going to do? We're going to do whatever is possible! Yeah, we're going to do presidential things! as soon as we figure out what those things are we're gonna do them by gum!"

He needs to get on this like he's in charge. I don't care how much faith he has in Geithner. He should be wasting his breath telling me that. I wasn't afraid that Barack has lost faith in Geithner I'm afraid wall street failures run Washington and that the government works for them.

[Gin]

8. it's not gonna go away until we buy all the toxic assets at face value

and... then the banks will have totally raided the treasury.....and we will have made foreign banks whole...and...all the robbers get off scott free...just like the bush cabal!

there is no end in sight unless we let them fail...and Bernanke stated...we cannot let the banks fail....so...we won't! (IMO)

[earcandle]

10. Why does Bernanke have so much authority?

[Alcibiades]

9. They kept saying that allowing AIG to fail

would have a cascading effect on other institutions. So why not let AIG fail, and bail out those other institutions on a case by case basis? Hard to see why that wouldn't be cheaper and more equitable.

[EFerrari]

12. Because wouldn't some of those other guys be overseas?

What would that mean to the global economy?

[saigon68]

11. "AIG was too well-connected to fail,"

That's Bull Shit

[Nihil]

13. Nope ...

... that's Bush Shit.

Unfortunately, the herd of shit-eaters is not constrained to the
previous administration.

[chimpymustgo]

14. That is it. The bonuses were the smack on the face that woke everydbody up to the

levels of greed and corruption and cronyism- far beyond what we'd even imagined. The monster has been unleashed - the people got a peek behind the curtain and WE ARE FUCKING PISSED!

NO MORE BAILOUTS OR BONUSES FOR WALL STREET.

[No Elephants]

15. "Flap" does not equal reality. People need to read some intelligent articles on the bailout and

stop knee jerking.