“Tim Geithner didn’t draft these contracts with A.I.G.,” Mr. Obama told reporters as he left for California on Wednesday.
But Obama and the Democrats wrote and passed a law that protected the bonuses paid out by AIG and other institutions that received TARP funds.
"Fair or not, questions about why Mr. Geithner did not know sooner about the A.I.G. bonuses and act to stop them threaten to overwhelm his achievements and undermine Mr. Obama’s overall economic agenda."
As Treasury Secretary, Geithner is responsible for communicating with the Federal Reserve since these two institutions work hand in hand. Since the Federal Reserve legally owns the AIG stake, and the Treasure is part of the Executive branch, the Treasury is responsible for acting like the owner and keep a close watch on AIG. Apparently nothing happened.
"The A.I.G. tempest has been especially explosive for Mr. Geithner because, as president of the New York Fed, he was the one administration official who had been involved in the Bush-era bailouts. "
How long will he last?
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