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Politics and Media Headlines 3/20/09

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Web news: Obama's Teleprompter has started a blog (by Glenn Garvin, Miami Herald)
Now this is a story you won't read in the Mainstream Media. On Wednesday, Rush Limbaugh was making fun of President Obama on the air, needling him about some recent Teleprompter screwups… Mildly amusing, as long as you're not a member of the People for Ethical Treatment of Technology or something. But then...the Teleprompter answered! Barack Obama's Teleprompter Blog appeared on the Web Wednesday, jibing back at Limbaugh as a technoboob… And get this: Not only does Obama's Teleprompter blog, he Tweets! Geeze, I hope nobody has left the nuclear codes lying around. This could be how the world ends, not with a bang but an unstable Teleprompter channeling HAL from 2001.

A.I.G. Sues U.S. for Return of $306 Million in Tax Payments (New York Times)
While the American International Group comes under fire from Congress over executive bonuses, it is quietly fighting the federal government for the return of $306 million in tax payments, some related to deals that were conducted through offshore tax havens… A.I.G. is effectively suing its majority owner, the government, which has an 80 percent stake and has poured nearly $200 billion into the insurer in a bid to avert its collapse and avoid troubling the global financial markets. The company is in effect asking for even more money, in the form of tax refunds. The suit also suggests that A.I.G. is spending taxpayer money to pursue its case, something it is legally entitled to do. Its initial claim was denied by the Internal Revenue Service last year.

13 Firms Receiving Federal Bailout Owe Back Taxes (AP)
At least 13 firms receiving billions of dollars in bailout money owe a total of more than $220 million in unpaid federal taxes, a key lawmaker said Thursday. Rep. John Lewis, chairman of a House subcommittee overseeing the federal bailout, said two firms owe more than $100 million apiece. "This is shameful. It is a disgrace," said Lewis, a Georgia Democrat. "We are going to get to the bottom of what is going on here." The House Ways and Means subcommittee on oversight discovered the unpaid taxes in a review of tax records from 23 of the firms receiving the most money, Lewis said as he opened a hearing on the issue.

President Barack Obama should serve the taxpayers, not Goldman Sachs, and liquidate AIG (by Gerald Warner, The Telegraph, U.K.)
Barack Obama and Tim Geithner have one sensible option: they must send the liquidators in to AIG to pick the bones clean. The sooner they take this drastic action, the more effective it will be. The perception is growing that the real motive behind the AIG bailout is to save the posterior of Goldman Sachs: AIG appears to have become a staging post through which billions of taxpayers' dollars travel into the coffers of Goldman Sachs and other banks.

In the Wake of AIG: Obama's First Priority (by Robert Reich)
Bottom line: Before it can clean up Wall Street or do much of anything else, the Administration has to clean up the way it's been trying to clean up Wall Street.

What A Progressive Economic Plan Looks Like (by Susie at Suburban Guerrilla)
There’s much more and you should really read the whole thing (especially his perspective on the banks), but James Galbraith’s “No Return To Normal” in the Washington Monthly really struck me as what a truly progressive and effective economic recovery plan would look like.

In New Dilemma, Banks Cite Two Paths to Disaster (Washington Post)
Some bank executives warned yesterday that the government is forcing them toward a disastrous choice between accepting restrictions on compensation that could cripple their ability to compete with rivals, or returning billions in federal aid, which could retard lending and damage the economy.
They think they can threaten us.—Caro

Off With the Bankers (by Simon Johnson and James Kwak, thanks to Economist’s View)
A.I.G. can hardly claim that its generous bonuses attract the best and the brightest. So instead, it defends the payments by arguing they’re needed to retain employees who are crucial for winding down transactions that are “difficult to understand and manage.” ... There is no reason to believe this. Similar arguments made during the 1997 Asian financial crisis ... turned out to be a smokescreen to protect the executives who were partly responsible for the mess… Only when outsiders took over did the public discover the full scope of the losses.

Wall Street Arrogance Meets Washington Meekness (by Jim Hightower)
Citigroup, once the world's largest financial conglomerate, has fallen so far down that you can buy a share of its stock today for less than it costs to use one of its ATM machines. A few days ago, however, Citi caused investors' hearts to go pitter-patter with joy when it loudly trumpeted that it had operated at a profit in January and February. It just goes to show you what enterprising Wall Street financiers can achieve through hard work, creativity, perseverance -- and about $45 billion in taxpayer bailout funds. Think how much larger the profit could've been if only taxpayers had done more!

Obama and AIG - Ties that Bind (by Pacific John at Alegre's Corner)
A huge Hillary supporter, Brad Sherman, said in [Wednesday’s] Congressional hearings, it is in the country's best interest to put AIG into receivership, spin off the viable business operations, and halt theft and manipulation by pirates in the holding company. As testimony indicates, the subsidiary insurance companies and savings bank are viable. The savings bank in particular is stable because it is backed by the FDIC. Much of the AIG bailout sloshed to what Sherman calls, the "richest," "most powerful entities" in the world, counterparties like Sachs. Sherman summarizes with, "It is said that AIG was too big to fail. It was explained, no, AIG is too interconnected to fail. I would put forward that AIG is too connected to fail."

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Carolyn Kay

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