Obama Remarks Today on AIG

President Obama met with small business leaders and others at the White House today to discuss administration plans for that sector of the economy. Prior to the meeting, he delivered some remarks regarding the current kerfuffle over AIG which I found rather vague but potentially indicating that a due diligence review may be underway at Treasury now that public outrage is pushing that forward a bit more.  See what you think.

What follows are those remarks as prepared for delivery:

But before I talk about the new steps we’re taking to get credit flowing to small businesses across our country, I want to comment on the news about executive bonuses at AIG.

This is a corporation that finds itself in financial distress due to recklessness and greed.

Under these circumstances, it’s hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay. How do they justify this outrage to the taxpayers who are keeping the company afloat?

In the last six months, AIG has received substantial sums from the US Treasury. I’ve asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole.

I know he’s working to resolve this matter with the new CEO, Edward Liddy, who came on board after the contracts that led to these bonuses were agreed to last year.

This isn’t just a matter of dollars and cents. It’s about our fundamental values.

All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multi-million dollar bonuses. And all they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules.

That is an ethic we must demand.

What this situation also underscores is the need for overall financial regulatory reform, so we don’t find ourselves in this position again, and for some form of resolution mechanism in dealing with troubled financial institutions, so we have greater authority to protect the American taxpayer and our financial system in cases such as this. We will work with Congress to that end.

(YouTube — Obama remarks today on AIG.)

7 Responses to "Obama Remarks Today on AIG"
Teddy Partridge | Monday March 16, 2009 10:05 am 1

Autoworkers’ contracts weren’t sacrosanct; neither were supplier contracts.

What’s so special about derivative traders’ contracts that makes them immune from renegotiation or outright cancellation?

Unless, of course, they are holding a gun to the world economy’s head. But shouldn’t we be told that, then?

oregondave | Monday March 16, 2009 10:33 am 2

I’ve asked Secretary Geithner to use that leverage and pursue every legal avenue to block these bonuses and make the American taxpayers whole.

Geithner so far? Fail.

GregOPauls | Monday March 16, 2009 10:39 am 3

Geithner a bad man.
Contract seem only valid for unions. Why are we not regulating them? Renegotiate those contracts. That is what would save the auto industry.

Christy Hardin Smith | Monday March 16, 2009 10:41 am 4
In response to Teddy Partridge @ 1

Part of me wonders how there could be such a deaf ear turned to common PR considerations, at the very least, on all of this, let alone questions of basic fairness in terms of dispersion of public monies. It really is bizarre on so many levels, isn’t it?

I have this gut feeling that something we don’t know yet will click a few more of these puzzle pieces into place — the question is, from what direction will it get flung out into the public purview and by whom and for what reason?

oregondave | Monday March 16, 2009 10:49 am 5
In response to Christy Hardin Smith @ 4

For what reason, and to what effect? Will it move things in the direction of addressing anger and (legitimate) grievances, or trying to stifle them/us?

Millineryman | Monday March 16, 2009 11:05 am 6

I think he’s pissed, I think he’s giving Geither and some of the others involved enough rope to hang themselves. He’s walking a very thin if he’s trying to get the populist anger to give him political coverage.

oregondave | Monday March 16, 2009 11:17 am 7

Here’s David Sirota’s take at Open Left:

Though it is certainly good news that the president is taking the more rational and populist line in this divide, it’s a huge problem that he’s allowing people to speak for his administration who seem to be directly undermining his wishes – in this case, his wishes to stop banks and insurance companies from ripping off taxpayers.

*By the way, I once thought this all might be a super secret pony plan whereby Obama is good cop and Summers/Geithner are bad cop/stupid cop. Now, I don’t think that at all. When the Summers/Geithner insist that nothing can be done, and Obama insists that they better do something, that’s not good or smart messaging, and therefore likely not pre-planned strategy – it’s just having no message at all, and that’s bad.

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