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In DC, Obama Officials Defend
Bailouts of AIG and Citigroup, Summers Speaks of Fear
Byline: Matthew Russell Lee of
Inner City Press at the UN: News Analysis
WASHINGTON,
March 13 -- The
ongoing bailout of insurer AIG and its counterparties was apologized
for but
defended by a range of Obama administration officials this week.
Treasury
Secretary Timothy
Geithner, until recently the president of the Federal Reserve
Bank of New York and before that at the IMF,
said he hated to have to bailout AIG,
but "it's
systemic."
His advisor Gene Sperling, a member of President Bill Clinton's
economic team, said the Obama administration took office only to find
AIG too
big to fail, implying that this was entirely attributable to the two
terms of
George W. Bush. But AIG was allowed to grow without control under Bill
Clinton,
just as Citigroup
was increasingly unsupervised under the tenure at the New
York Fed of Timothy Geithner, as CitiFinancial got deeper into
predatory lending (click here for Inner City
Press reports on that.)
Friday in the White House Barack Obama met and then
faced the Press with
Paul Volcker, chairman of the Federal Reserve in the time before Bill
Clinton.
Volcker rarely used his regulatory powers, at least not to protect
consumers
from predatory lending. And yet now these are the people, along with
Clinton's
Treasury Secretary Larry Summers, who are defending massive transfers
to
Citigroup and AIG, all the while laying blame everywhere except upon
themselves.
Barack Obama, Summers, Dodd, Geithner and
Shelby, accountability for AIG & Citi not shown
There were only two questions after Obama's meeting
with Volcker, one to
Obama on economics and the other by Obama about his own spokesman. He
was asked
about Larry Summers' comments earlier in the day that "Americans have
an
excess of fear" -- shades of Phil Gramm there, noted one wag -- and
then,
as he left, he asked about how White
House Press Secretary Robert Gibbs is
doing. From the pool:
Subject:
Pool 1
From:
Thomma, Steve
To:
Finkenbinder, Benjamin N.
Sent:
Fri Mar 13 15:10:39 2009
You
have the transcript from the Oval Office remarks by the president and
Paul
Volcker. Here's a postscript: As we were leaving, Mr. Obama asked,
"How's
Gibbs doing?"
"Great,"
came the reply. "Not too bad."
Mr.
Obama's advice to the press: "Take whacks at him."
-Steve
Thomma, McClatchy Newspapers
And so it goes in Washington...
Footnote: Gene Sperling,
recounting his time as an advisor to the TV show "The West Wing," said
without irony that "We don't have to rely on President Bartlett anymore
-- we have Barack Obama!" He said that securitization is "part of the
solution." Certainly that's music to the ears of Citigroup and AIG, Goldman
Sachs and Morgan Stanley. One wag wondered, concluding the week in
DC, it is Gene Sperling or the Twilight Zone's Rod Sterling?
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Watch this site, and this Oct. 2 debate, on
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and this October 17 debate, on
Security Council and Obama and the UN.
* * *
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Click
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AlertNet piece by this correspondent
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here
for an earlier Reuters AlertNet piece about the Somali
National
Reconciliation Congress, and the UN's $200,000 contribution from an
undefined trust fund. Video
Analysis here
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