I hate to say it, but I think Josh Mashall is right here
Like you, I've been watching this AIG bonus story unfold over the weekend. And though I did not see it at first, I think it may prove to be a turning point, both for AIG and the government.
I don't believe the bonuses themselves are the heart of the matter, nor the fact that they're going to the very executives who caused AIG's implosion or even the galling reality that, since all money is fungible, they're being paid with taxpayer dollars. What's really driving this forward -- and what makes it such a dangerous moment for the White House -- is the jarring image of the administration's impotence.
It's not that the Obama administration is any more or less impotent than Bush's was or McCain's would've been, it's the mere fact that this now is happening under his watch. Besides the outrage over the bonuses generally, the optics are horrible . However, there is a way out for the administration. Nationalize AIG. Nationalize them now and, as I said in my earlier post
, destroy the Financial Products division (the group responsible for this mess). The political and popular will would certainly be behind such a move. If AIG is really too big to fail, then the administration has no choice. It's either a takeover or they live with the AIG monkey on their back throwing shit and pissing on their grand plans for the next four years.