The Criminal Element

President Obama, apparently as disgusted as the rest of us:

“In the last six months, A.I.G. has received substantial sums from the U.S. Treasury,” Mr. Obama said. He added that he had asked Treasury Secretary Timothy F. Geithner “to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole.”

In strongly-worded remarks delivered in the White House East Room before small business owners, Mr. Obama called A.I.G. “a corporation that finds itself in financial distress due to recklessness and greed.”

“Under these circumstances, it’s hard to understand how derivative traders at A.I.G. warranted any bonuses at all, much less $165 million in extra pay,” Mr. Obama said. “How do they justify this outrage to the taxpayers who are keeping the company afloat?”

White House officials said that the administration is not looking to take A.I.G. to court to stop the company from paying out the bonuses. But they said the Treasury Department would be trying to figure out what they can do to block A.I.G. from making the payments within the legal confines of A.I.G.’s contractual obligations to the executives.

“All across the country, there are people who work hard and meet their responsibilities every day, without the benefit of government bailouts or multimillion-dollar bonuses,” said Mr. Obama, who called the issue one of “fundamental values.”

“All they ask is that everyone, from Main Street to Wall Street to Washington, play by the same rules,” he said.

New York Attorney General Andrew Cuomo, picking up Eliot Spitzer’s old niche as populist crusader against Wall Street largesse, has threatened to serve AIG with subpoenas if the company doesn’t send over a “list of employees who will receive these bonuses, as well as their job information and performances” by the end of the day.

As outrageous as these repeated bailouts have been, it’s nice to see rhetoric like Obama’s flowing from the East Room of the White House. To Go John Galt Karl Marx for a moment, crises like the debt derivative catastrophe we find ourselves in now “highten the contradictions” – they lay bare the competing interests of disparate social cliques, call into clear relief the prevailing socioeconomic structure of the society at large, and show us whose side everyone is really on. All of these things fuel a popular rage that compels us to question the fundamental legitimacy of the current order. For the last 30 years we could rely on the federal government – and the occupants of the Oval Office especially – to pretend to be above that fray, even as they quietly took the money and did the bidding of the people we now refer to as the Masters of the Universe. Obama’s remarks – “all they ask is that everyone play by the same rules” – at least indicates a recognition among mainstream politicians that, down here, we’re starting to wonder if “Change” is really all the change we need.

Remarking on the insane WaPo article we discussed earlier, Dean Baker posts an interesting chart…