All Blog Posts from Political Hotsheet

A longtime member of Congress is under investigation for assisting a bank to which she had personal connections get federal bailout money, a congressional ethics panel said this week.

The House ethics panel is investigating Rep. Maxine Waters (D-Calif.) after she arranged in 2008 for a meeting between OneUnited Bank executives and Treasury officials, the Wall Street Journal reports.

Waters' husband, Sidney Williams, was a member of the bank's board until last year, the newspaper reports, and had investments in the bank worth at least $350,000.

The bank received $12 million from the federal government's Troubled Asset Relief Program.

Waters, who serves on the House Financial Services Committee, has defended her request for the meeting as part of her efforts to advocate for minority-owned businesses, the Los Angeles Times reports. She reportedly said that she disclosed her husband's ties to the bank and that her influence had nothing to do with the bailout.

The watchdog group Citizens for Responsibility and Ethics in Washington (CREW), however, claims Waters did not disclose her financial ties to OneUnited Bank when she contacted the Treasury Department to arrange the meetings. The group says Treasury officials claimed they only arranged the meeting after hearing from Waters, even though the bank had requested meetings before.

The investigation has landed Waters on CREW's "15 most corrupt members of Congress" list.

It has been a year since the failure of Lehman Brothers and the subsequent financial and banking crisis on Wall Street that brought the U.S. economy to the brink of collapse; while for months Americans have ranked the economy as the most important problem the country faces, opinions about measures to address the economic instability resulting from last fall's events have found mixed support at best.

In polls conducted last fall, both the general principle of providing government assistance to financial institutions and the specific legislation Congress passed last fall met with lukewarm public support.

A CBS News/New York Times poll conducted September 21-24, 2008, in the immediate aftermath of the collapse of Lehman Brothers, found just 42 percent of Americans approved of the government providing money to Wall Street, and more, 46 percent, disapproved. Those sentiments transcended partisanship: just 43 percent of Republicans, 41 percent of Democrats and 4 percent of independents approved. By October, just 36 percent approved of this approach, and 52 percent disapproved.

Views have not changed much since then. In March 2009, a CBS News Poll found 41 percent approved -- and more, 50 percent, disapproved -- of the government providing money to banks and other financial institutions to try to "help fix the country's economic problems."

Why such lukewarm support for these plans, which were presented as helping the U.S. economy avoid the worst economic crisis since the Great Depression?

One answer could be the blame Americans placed on the banks themselves for the financial troubles they were experiencing. The September 2008 poll found that 46 percent of the public thought that bad management by the banks was to blame for those problems, and just 27 percent thought that a lack of government supervision was to blame. Another 17 percent thought both were at fault. By March, fully 75 percent of Americans felt that the banks' problems were caused by management decisions, and only 17 percent thought they were the result of conditions beyond the banks' control.

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The White House is raising no objections to the $7-million-a-year pay package being given to the new CEO of American International Group – the insurance giant that received a U.S. government bailout package worth $182.5 billion.

"We're not micromanaging these companies," says White House Press Secretary Robert Gibbs. He says the government "is not making these decisions."

Federal pay czar Kenneth Feinberg is said by the company to have approved in principle of the compensation plan for CEO Robert Benmosche.

Asked why taxpayers "shouldn't feel like suckers if they see the CEO of a government-owned company getting $7 million a year," Gibbs acknowledged that AIG is "a royal mess." But he said the company's board wants "good, competent leadership that can lead the company back toward profitability."

The government now owns about 80 percent of AIG, and Gibbs said it hoped new management can help taxpayers recoup some of the investment they put in to prevent an economic calamity.

At $7 million a year, CEO Benmosche will be earning 17.5 times as much as President Obama, whose salary is set by Congress at $400,000 per annum.

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Politics Today is CBSNews.com's inside look at the key stories driving the day in Politics, written by CBS News Political Director Steve Chaggaris:

**President Obama continues health care push...

**TARP Inspector General to testify on how bailout money is being spent...

HEALTH CARE: As President Obama continues stressing his self-imposed crunch time – his demand that Congress pass health care bills by the first week in August – he also continues his campaign-style focus on the issue.

Today, he meets with members of the House Energy and Commerce Committee, one of the three House committees charged with health care reform.

Just prior to that meeting, he'll deliver remarks on health care. Later, he sits down with CBS Evening News anchor Katie Couric.

Tomorrow, he'll hold a prime time news conference where he's expected to kick it off with remarks on health care; Thursday, he heads to Cleveland for a town meeting-style event on the issue.

While criticism from Republicans builds, skepticism from some in his own party ramps up and talk of his deadline slipping increases, the president is becoming more aggressive in his push.

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A struggling Hawaii bank received a $135 million federal bailout last fall two weeks after staff from the office of Sen. Daniel K. Inouye, a big investor in the bank, called federal regulators about the aid application, according to a report in ProPublica Tuesday.

Bank regulators had designated Central Pacific Financial as a marginal candidate to receive federal assistance, according to documents cited in the report. But soon after the phone call from Inouye's office, the Treasury directed millions of dollars to bolster the bank's capital reserves.

Inouye, D-Hawaii, owns shares in the bank that totaled between $350,000 and $700,000 at the end of 2007, according to the report. That amounts to roughly two-thirds of the senator's personal wealth.

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American International Group, which stoked populist outrage for distributing large retention bonuses funded by a federal bailout, has once again given taxpayers something to grumble about. As Politico first reported and CBS News has confirmed, the troubled company now says it paid employees $454 million dollars in bonuses in 2008 – an increase from the $120 million it claimed to have paid out in March.

A congressional aide tells CBS News’ Jill Jackson that AIG gave the figure to Rep. Elijah Cummings on Friday.

As Politico points out, this represents the third figure offered by the company concerning its 2008 bonuses. First CEO Edward Liddy told the House Financial Services Subcommittee the bonuses were likely “in the range of $9 million.” A few days later, spokesman Nick Ashooh offered the $120 million number. The new number, $454 million, is nearly quadruple that.

These bonus payments are separate from the $165 million in bonuses given out by the company to employees or former employees of the AIG Financial Products – whose work brought the company to Washington begging for a bailout.

Many of the employees who received portions of the $454 million in bonuses had nothing to do with the financial collapse of the company. The bonuses were given in much smaller amounts this time around, averaging between $5,000 and $50,000 across the entire company.

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The uproar over the $165 million in bonuses that insurance company AIG paid to employees has continued this week -- there have even been protests outside AIG employees’ homes. Certainly, some people are outraged that the bonuses were paid, but how widespread is the anger? Is it shared by most Americans, or just a noisy few? And who is feeling it most?

The most recent CBS News Poll can shed some light on those questions.

Fifty percent of Americans told us they feel angry about the bonuses paid to AIG employees. Another 38 percent say they feel bothered by those bonuses. Just 12 percent are not bothered.

Those who have heard or read a lot about the AIG bonuses are more apt to be angry – 59 percent of them say that’s how they feel. Anger is also more widespread among older Americans – 61 percent of those age 45 and older describe themselves as angry, while among those under 45, just 38 percent are angry.

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White House press secretary Robert Gibbs said the White House is pleased with yesterday's performance on Wall Street following the release of details of the Treasury Department's toxic asset plan, but cautioned against reading too much into a single day's trading.

"We don't spend a lot of time worrying or looking at what happens each day in the market," Gibbs told Early Show anchor Harry Smith. "Instead the president wants to feel confident and give the American people confidence that what we're putting in place will bring our economy back [in the] long-term, create jobs and lay a path towards prosperity again."

Gibbs also didn't characterize the market's upbeat mood as "vindication" for a White House and Treasury official that have been feeling lots of heat of late.

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On the sixty-third day of his presidency, President Obama called on companies to come up with advancements in renewable energy to help the country get through the recession.

"At this moment of necessity, we need you," Mr. Obama said during an speech at the White House. "We need some inventiveness. Your country needs you to create new jobs and lead new industries. Your country needs you to mount a historic effort to end, once and for all, our dependence on foreign oil."

Mr. Obama also praised the bank rescue plan unveiled by Treasury Secretary Tim Geithner today after a meeting with Geithner and his other economic advisers.

"The good news is that we have one more critical element in our recovery, but we've still got a long way to go, and we've got a lot of work to do. But I'm very confident that, with the team that we've got assembled, we're going to be able to make it happen," he said.

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It was a day of outrage on Capitol Hill. Outrage that AIG, recipient of almost $180 billion in federal bailout money, is paying out $165 million in "retention awards" to hundreds of employees, including 73 bonuses of $1 million or more and 11 payments to people who no longer work for AIG.

As CBS News and others have documented that outrage is disingenuous coming from lawmakers who have known about the pending bonuses for months.

In particular, it's disingenuous coming from anyone who voted for the American Recovery and Reinvestment Act of 2009 (a.k.a. the Obama stimulus package). The stimulus bill included provisions to limit executive compensation at companies receiving federal bailout money. But it also stated explicitly that the limits would not apply to bonuses agreed to prior to Feb. 11, 2009.

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