Wall Street and Washington insiders like Larry Summers and Tim Geithner have spent the last few weeks telling America there's supposedly nothing that can be done to stop bailed out banks from using our taxpayer money to subsidize executive bonuses. As the New York Times reported this morning, Summers specifically "suggested that there was little if anything the government could do to stop [AIG's bonuses], seconding the conclusion of Treasury Secretary Timothy F. Geithner." Now, President Obama has publicly contradicted them, signaling a major schism in the new administration:
Obama Orders Treasury Chief to Try to Block A.I.G. BonusesBy HELENE COOPER
Published: March 16, 2009WASHINGTON -- President Obama vowed to try to stop the faltering insurance giant American International Group from paying out hundreds of millions of dollars in bonuses to executives, as the administration scrambled to avert a populist backlash against banks and Wall Street that could complicate Mr. Obama's economic recovery agenda.
The differing messages from the Obama administration suggests the potential for a major economic credibility gap whereby lower-tier functionaries like Summers and Geithner are saying one thing while the president is saying something entirely different. It raises a very serious question: Who is in charge - the president or the Washington and Wall Street insiders he put around himself?
I don't think we really have an answer.* 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. That's not "team of rivals" - that's the Team of Zombies creating mixed messages, which reinforce the idea that this administration still refuses to answer the fundamental question: Which friggin' side are you on?
*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.
Loading comments… 
Taking action against them means taking action against their racquetbal
It just never occurred to them to TRY and get the money back.
Hopefully Obama will be leading them and not be led by them.
We need some populist outrage in the Treasury Department
If Obama is unwilling to replace Geitner and Summers, then he needs to make sure he's in charge of them.
Now I'm not so sure it was a good idea. I still trust the President, but I think the faith he put in to being able to control these "types", may have been a bit too optimistic
The President at least deserves credit for making a change the way he is doing, and doing it in such a way as to give the impression , that he's willing to take the flak. That's balls, and he deserves to be commended for it.
Robert Reich had it right when he recently said that if a insurance company or bank is "too big to fail
then it needs to be broken up under anti trust law."
Teddy Roosevelt would have no problem dealing with the big Wall Street crowd.
He would simply break them up. Bigger is not better especially since we are no longer the
biggest creditor nation but the biggest debtor nation.
All the media talking heads have talked about is Lincoln's influence on Obama.
I've said it before here and I'll say it again. It's not Lincoln stupid it's Teddy Roosevelt that
Obama needs to study. If Obama only had the balls that George Bush had and used
his presidenti
years ago when America exploded with populist anger.
Other people to consider would be Alice Rivlin and Paul Krugman. Also, President Obama needs to pay more attention to the Senate Budget Chairman, Kent Conrad. He might be more right of center, but he is decent and well respected.
Remember it was Summers who pushed hard for "Free Trade" that has taken away 30 million American jobs and shifted America's walth to China.
Tarrifs will create jobs here in America. They used to claim every billion dollars of exports creates 50,000 Americn jobs. Since we are running a $600 billion dollar trade deficit, that means we lost a net 30 million jobs to unfair/unb
By the way, how is that request to China for a new trillion dollar loan coming along? To bad you shifted thousands of our factories to China and now they earn the money.
http://onl
Will President Obama and Congress get in front and fix the loopholes in the recent TARP legislatio
David, good question, i've been asking this for months. wall street's been acting like petulant, spoiled brats with no parental oversight. I'm very happy President Obama's found the Big Stick*
* you know, Teddy Roosevelt'
Although I'm an Obama supporter, I'm afraid Obama is being overly influenced by Geithner and Summers. From appearance
I think it is time to make a change. Get the money back and fire Summers and Geithner.