Media reports continue to describe a growing sense of "outrage" in Congress and at the White House over the AIG story, with analysts casting doubt on White House claims that it learned of the insurance giant's bonus plans only recently. ABC World News reported "the heat is on at the White House, where questions are being raised about when the Obama Administration became aware of the bonuses, whether those in the Administration should have made it their business to know sooner, and whether the bonuses could have been stopped in the first place." According to the CBS Evening News, "On a day when much of Washington churned with anger over AIG bonuses, the President simply changed the subject with a series of light hearted events celebrating St. Patrick's Day. He never mentioned AIG in public."
The Wall Street Journal reports Obama "knew he had little power to stop AIG from issuing the bonuses, even as he stood before television cameras and vowed Monday to 'block these bonuses,' White House officials said," and "by the end of the day, the White House acknowledged its limited options." The AP says, "So far, the administration has been unable to match its actions to Obama's tough rhetoric on executive compensation." The Washington Post reports on its front page, "Senior White House officials said last night that...Obama did not learn" about the impending bonuses "until Thursday, one day before they were issued and two days after" Treasury Secretary Geithner "was informed that the payments were going forward." The AP reports that "while the White House expressed confidence in Geithner, it was clearly placing the responsibility for how the matter was handled on his shoulders." The Washington Times (3/18, Curl) reports Republicans criticized "the Obama administration for not putting in place tougher restrictions on bonuses and other compensation payouts to AIG even as the Treasury Department was pumping new taxpayer bailout funds into the company."
The Washington Post, in a front-page article titled, "AIG Firestorm Raises Alarm For Other Firms," reports, "Officials at the Federal Reserve and the Treasury Department are increasingly worried that the controversy could discourage investors from joining a new government effort to revive consumer lending as well as a separate plan that relies on private money to buy toxic assets from banks, sources familiar with the matter said." Ruth Marcus, in her column for the Washington Post, writes, "The administration's already dim prospects for obtaining another boatload of money for the bank bailout have gotten even dimmer." The Christian Science Monitor also reports that "if the public, and their elected representatives in Washington, conclude that Mr. Obama and his administration did not do everything in their power to halt the bonuses," Obama's "entire agenda could be at risk." Sen. Ron Wyden, on CNBC's The Kudlow Report, complained that the Administration "has been sending mixed messages on this bonus issue. ... The Administration has got to get its act together."
CBS Poll Finds Obama Approval At 62% The CBS Evening News reported, "Despite the fallout over the bonuses, President Obama's approval rating remains high. A CBS News poll out tonight puts it at 62%, about where it's been since the last month." CBS added that "35% of Americans now believe the country's headed in the right direction. Only seven percent felt that way in October." Dick Morris, however, writes in The Hill that "Obama is paying attention to the polls showing diminishing support for his policies." Obama "got 52 percent of the national vote. So when his approval drops, as it has, from 65 percent on Inauguration Day to 56 percent now (according to Rasmussen), he is playing with house money."
The CBS Evening News reported last night that White House spokesman Robert Gibbs "defended embattled Treasury Secretary Tim Geithner," and "insisted the AIG bonuses would be even bigger if Geithner hadn't intervened last week." The Wall Street Journal calls the "bonus flap" another "blow to Mr. Geithner, following criticisms concerning his tax history and the launch of his bank bailout revamp." On CNBC's The Kudlow Report, CNBC's Charlie Gasparino reported, "Here's the problem Tim Geithner has. ... The bailout occurred when he was New York Fed chief. ... By attacking these contracts you are, in essence, attacking Tim Geithner, who either knew about these contracts or should have known about the contracts because they were cut when he was the head of the New York Fed." Fox News' Special Report reported Senate Minority Leader Mitch McConnell "blamed...Geithner for loaning AIG $30 billion in bailout bucks two weeks ago without addressing, or perhaps even knowing about, its looming bonuses." The Financial Times says Geithner "faces a critical test of his credibility when he unveils a much-awaited plan to take toxic assets off bank balance sheets in an announcement expected in the coming days." Harold Meyerson, in the Washington Post, says, "No one expects Tim Geithner to become a born-again populist, but is it asking too much of him that he come up with a plan that doesn't throw our money at the same bankers engaged in the same old practices that brought us to this pass?"
Republicans Question Dodd's Role Fox News' Special Report noted that Sen. Chris Dodd "was the top recipient of AIG donations last year...and Republicans blame Dodd for slipping the language into the...stimulus package to protect corporate bonuses contracted before February 11 of this year, which includes AIG. Dodd denies direct responsibility." In an interview shown on CNBC's The Kudlow Report, Senate Minority Leader Mitch McConnell said, "Interestingly enough, Sen. [Olympia] Snowe of Maine offered an amendment to the stimulus bill that might well have prevented this kind of bonus. It mysteriously disappeared in a conference committee on the stimulus bill controlled by the Democratic majority here in Congress."
The Washington Times (3/18, Sands), meanwhile, says Dodd "unexpectedly has emerged as one of the most vulnerable Senate Democrats heading into the 2010 election cycle. ... Dodd's powerful perch as chairman of the Senate Banking Committee is proving a liability as the financial bad news keeps coming."
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In what some media sources interpreted as a strategic shift to a more partisan course of action, President Obama on Tuesday forcefully advocated his $3.6 trillion budget blueprint. The New York Times reports Obama "took a swipe at Republican critics." Obama's "strong words were the latest in a push that has come to resemble elements of the two-year-long presidential campaign. Mr. Obama may hold his second prime-time news conference as president, perhaps as early as next week, to talk up the budget." The Hill reports Obama "ditched his bipartisan budget sales pitch Tuesday and went on the offense. ... The move comes after the president felt substantial pushback from lawmakers in both parties who sharply attacked key elements in his $3.55 trillion proposal." The Los Angeles Times says that in an "effort to boost pressure on congressional Republicans," President Obama "appealed to them to stop sniping at his budget proposals and offer their own constructive ideas." Fox News' Special Report showed President Obama saying, "'Just say no' is the right advice to give your teenagers about drugs. It is not an acceptable response to whatever economic policy is proposed by the other party."
The Politico describes Obama's comments yesterday as his "most forceful attempt to rebut critics including some in his own party who say he's taking his eye off the ball, and that solving the U.S. economic meltdown should take precedence over all else." The Christian Science Monitor says that despite criticism...that President Obama is "trying to do too much with his budget," Administration officials "have a two-word answer: That's wrong." OMB Director Peter Orszag said, "The risks of not acting are substantial." CNN's The Situation Room reported, "There's absolutely no indication at all that the President is planning on taking his foot off the gas pedal." The Washington Post adds that Obama's comments "came as Republicans raised the volume of criticism against a plan they have called overly extravagant."
Meanwhile, McClatchy reports Orszag "threatened Tuesday to use a congressional rule to force some controversial proposals through the Senate by eliminating the Republicans' power to block legislation." Orszag said the Obama Administration "would prefer not to use the budget 'reconciliation' process that allows measures to pass the Senate on simple majority votes." Orszag said, "We'd like to avoid it if possible. But we're not taking it off the table." The Washington Post reports in a front page story that senior members of the Obama Administration "are pressing lawmakers to use a shortcut to drive the president's signature initiatives on health care and energy through Congress without Republican votes." However, Roll Call reports a "bloc of Senate Democratic moderates is quietly maneuvering to keep open the option of vetoing two of President Barack Obama's most ambitious agenda items this year - climate change and health care reform."
McClatchy reports President Obama "held out his first judicial nominee on Tuesday as evidence that he wants to end the political sniping over judges that marked much of the past eight years." In a statement, the President "praised David F. Hamilton of Indiana, his pick for the US 7th Circuit Court of Appeals, for 'a history of handing down fair and judicious decisions.'" The New York Times calls Hamilton "a highly regarded federal trial court judge from Indiana," and notes the "senior administration official said Judge Hamilton would have the support of both" Indiana Sens. Evan Bayh and Richard Lugar. The official "said part of the reason for making the Hamilton nomination the administration's first public entry into the often contentious field of judicial selection was to serve "as a kind of signal" about the kind of nominees Mr. Obama will select." The Politico, however, notes "a senior White House official" said "Obama is determined to set a more civil tone for the judicial nominating process in part because some of his future nominees will be more ideologically provocative than the first name being sent to the Senate." The Washington Times reports "Hamilton's nomination comes less than two months into the administration, meaning Mr. Obama is moving at a faster clip than Mr. Bush."
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The Hill reports that Pennsylvania Sen. Arlen Specter (R) "said Tuesday that he will not run for reelection in 2010 as a Democrat, but might run as an Independent." Specter "said in an interview with The Hill that the role of the" GOP "in Washington is too vital for him to switch to the Democratic side." But he said "he is open to the possibility of running as an Independent with the understanding that he would caucus with Republicans, just as" Connecticut Sen. Joe Lieberman (I) "did with Democrats in 2006."
The AP reports that Democrat Al Franken "filed a spreadsheet Tuesday listing 430 rejected absentee ballots that he presented to" the "three-judge panel" hearing the Minnesota Senate recount trial. That "includes the 252 his lawyers said should be counted in closing arguments last week." In his own filing Tuesday," Republican Norm Coleman "restated his case for the judges to take a generous view in deciding on absentees to make up for counties applying unequal standards."
The Minneapolis Star Tribune reports, "The more marginal [of the 430] ballots could help Franken if the panel accepts a version of the Coleman argument that it use 'common sense' in deciding which ballots to count, rather than a stricter interpretation of state statute." The St. Paul Pioneer Press reports that in his filing, Coleman "said that 1,984 absentee ballots should be opened and counted. His list includes not only the 1,359 absentee ballots his lawyers ended their case last week saying were valid, but also the 413 that the campaigns blocked from counting during the recount and the 15 that local governments verified were valid or found - two in a storage bin - well after the state's two-month recount."
Franken Wants Coleman To Pay Court Costs The Minneapolis Star Tribune reports that Franken "wants the judges who heard the U.S. Senate trial to force Norm Coleman to pay court costs and some opposing lawyers' fees -- a potentially expensive bill -- if the Republican loses his bid to overturn the results of the recount."
Leaked Coleman Donors' Data Explained The Minneapolis Star Tribune reports, "A spokesman for the website that posted a list of thousands of Norm Coleman's contributors last week said that an anonymous person found the document 'floating around on the Internet' and uploaded it onto Wikileaks.org to expose the security breach."
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Roll Call reports that National Republican Congressional Committee and National Republican Senatorial Committee officials "said Tuesday that Alaska Gov. Sarah Palin (R) is still scheduled to headline their annual joint fundraising dinner in June, following a report in her home state that the governor was not confirmed to speak at the event." A story in the Anchorage Daily News "on Monday evening reported that Palin had not confirmed her attendance at the dinner." Yesterday, spokesmen for both GOP campaign committees "said separately that to their knowledge, Palin is still scheduled to headline the event."
The Arizona Republic reports that GOP "political operative Lisa James has joined" AZ3 Rep. John Shadegg's (R) "office as deputy chief of staff." Ex-Shadegg chief of staff Sean Noble "called the hire 'the most obvious signal' that Shadegg will seek a ninth term in 2010."
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Jay Leno: "Hey," a "little quiz" for you. What is "the difference between an AIG executive and a drunken Irishman? A drunken Irishman spends his own money."
Jay Leno: "The Republicans are on board in this, too. Iowa Senator Charles Grassley told AIG executives -- this is what he actually said -- he said they should either quit or commit suicide." But "I think that's plain wrong. I mean, why give them the option of quitting?"
Jay Leno: "I like" Grassley's "idea, but here's my question: where was Congress when everything was falling apart, you know? They're supposed to be looking out for us. Here's a better idea. How about AIG and Congress making a giant suicide pact?"
David Letterman: "By the way, while you were laughing, AIG just handed out another $100 million in bonuses."
A story in yesterday's Political Bulletin incorrectly identified the dollar amount of the bonuses American International Group paid to executives. The amount should have been $165 million.
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