Rep. Waters Demands Obama Clarify AIG Bonus Provision

Published March 20, 2009


Rep. Maxine Waters, D-Calif., called on President Obama on Friday to explain what happened when a provision was added to his economic stimulus bill last month that allowed AIG employees to receive $165 million in bonuses.

Waters' comments were the strongest criticism yet from a Democrat over a controversy that continues to grow.

Sen. Christopher Dodd, D-Conn, confessed Wednesday to adding language to a spending cap in the stimulus bill that specifically excluded executive bonuses agreed to before the bill's passage. But he added that Treasury officials forced him to make the change to protect the government from potential lawsuits.

It was a reversal from Dodd's position a day earlier, when he strongly denied he had anything to do with adding the provision.

"They've got some explaining to do," Waters told Joe Scarborough on his WABC radio show Friday morning. "And I think the president is going to have to clarify to the American public what took place between Treasury and Mr. Dodd.

"Obviously, there appears to be some sort of an agreement that they would protect AIG from having to give those bonuses. I don't know who said what and when," she added. "Chris Dodd said he wrote the language but that he was pressured practically by Treasury. Maybe the president is not up to speed on what is going on, but I think it is going to have to be clarified."

The provision added to the stimulus bill was a broad measure that applied to all companies receiving bailout money, not just AIG, though the AIG bonuses in particular have caused outrage in Washington and around the country after the insurance giant received more than $170 billion in federal aid.

The U.S. government now has an 80 percent stake in the company, which was hit hard by the downturn in the housing sector and by the failure of complex securities based on risky mortgages.