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This could be good.

Not content with letting New York Attorney General Andrew Cuomo hog the spotlight, his Connecticut counterpart, Richard Blumenthal, has subpoenaed several AIG employees, incluing CEO Ed Liddy, to testify about those bonuses, totaling $165 million, at a legislative hearing March 26th.

Said Blumenthal in a statement:

Now living off supersized taxpayer-paid bonuses, these AIG employees have a moral and legal obligation to appear at this legislative hearing and disclose details about corporate compensation to employees," said Blumenthal in a written statement.


AIG Financial Products, the unit that caused the company's collapse and got those bonuses, is absed in Wilton, Connecticut.

These hearings should be more good theater, but it's worth asking: given that Liddy has already testified, and Cuomo will likely soon release the names of the bonus recipients, what more pertinent information will AIG employees be able to provide? Guess we'll find out...

As D.C. legend has it, George Washington told Thomas Jefferson that the Senate was designed as a saucer to "cool" the heat of House-passed legislation. Put another way, the Senate has a talent for helping bills grind to a screeching halt after arriving from the House, where the majority party has more power.

And this week's outrage-fueled AIG bonus tax is no exception. One day after the House passed a 90% retroactive levy intended to claw back bonuses at the infamous company, the future of the bill in the Senate remains less than clear.

The Senate version of the bonus tax is more measured than the House version, imposing a 35% tax on bonuses. But it also applies the tax to any company receiving more than $100 million from the bailout, while the House measure only applied to firms getting more than $5 billion. Several senior GOP senators, from Judd Gregg (NH) to Jon Kyl (AZ), have blasted the tax bill in recent hours, suggesting that Republican leaders may split on the proposal, just as they did in the House.

Could Republicans mount a filibuster of the bonus tax bill next week? Anything is possible in the current volatile political climate -- especially after today's revelation that the House bill would exempt $2.5 billion in hasty bonuses awarded last year at Merrill Lynch.

Ultimately, however, the political risk of appearing tolerant of AIG's bonuses is sure to push at least a few GOP senators over to the "yes" camp. Then the X factor becomes whether any Democrats will take the unpredictable route and raise questions about the bonus tax's constitutionality.

For an accurate reading of the tea leaves, check out this headline from Dow Jones (emphasis mine): "Sen. Reid: Senate Should Take Up AIG Bill Before April 6."

There really is no dismissing Rush Limbaugh, is there? Earlier today, in the special election for Kirsten Gillibrand's old House seat, Republican candidate Jim Tedisco declared that "Rush Limbaugh is meaningless to me."

Now, Tedisco's campaign has released a statement clarifying what he meant:

"Jim's comments were in response to a question about what voters are asking him about on the campaign trail. So far, the concerns he has been hearing from voters on the campaign trail have been local in nature, such as his support for lower property taxes, fiscal responsibility, and his opponent's appalling support for the AIG bonus loophole. That was his point and any effort to characterize it otherwise is a distortion of the facts."


Late Update: The DCCC's statement ridiculing Tedisco is available after the jump.

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It looks like Andrew Cuomo holds all the cards. He now has in hand the names of the recipients of both of the corporate payouts that have provoked all that populist rage lately. A judge earlier this week ruled that Bank of America had to turn over the list of names of the 200 highest-paid Merrill Lynch bonus recipients, that the New York Attorney General has been seeking. According to reports, B of A, which now owns Merrill, did so yesterday.

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TPMDC has reported on how indignant Republicans are that Democrats are considering filibuster-proofing the coming climate change bill by making it part of the budget -- remember, 25 GOPers signed a letter nixing that option last week -- but the GOPers on the Senate environment committee are taking it to a new level.

In a letter to their fellow senators today, the environment panel's Republicans throw every rhetorical weapon in their arsenal at the Obama administration for putting revenues from carbon regulation in its budget. What they're afraid of is what the energy industry has called the "nuclear option," a budget item for climate change that would fast-track the bill to passage.

And to help strangle that option, the Republicans have renamed cap-and-trade emissions limits. They're now being christened an "energy tax," which creates a nice opening to slam Democrats as tax-hikers. Read the full letter after the jump, and fear the ominous "energy tax" ...

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Minnesota DFL spokesman Eric Fought has given TPM this statement about the comments by Coleman attorney Joe Friedberg, that Coleman will likely lose the election trial and then appeal:

"It's refreshing to have someone aligned with former Senator Coleman actually telling the truth. Mr. Friedberg is right -- Al Franken received more votes on Election Day. That was proven in a fair and accurate recount and will be proven once again at the conclusion of this meticulous and fair contest.

"When the results of the recount became evident, Coleman's legal team claimed that they were focused on the contest because that was where they could make their case. Now that they have failed to make their case in the courtroom, they claim that they will make their case in the appeals process. Clearly, there isn't a case to be made. Senator-elect Franken needs to be seated so he can move on to do the people's business."

Earlier today, we told you that in the view of one expert, some of the allegations about former AIGFP chief Joe Cassano echo those in the WorldCom case from earlier this decade, which ultimately sent former CEO Bernie Ebbers to jail -- in particular the charge, made in at least one investor lawsuit, that Cassano obstructed the work of his firm's auditors.

And it turns out that there's another parallel with the WorldCom case. Cassano's lawyer, white-collar crime expert Joseph Warin of Gibson, Dunn, and Crutcher, was hired by WorldCom in 2003 to conduct an internal investigation into allegations that it re-routed long-distance phone calls in order to get out of paying billions of dollars in fees owed to other companies.

That's a different charge from the one that felled Ebbers. Still, could it be another small sign that this whole AIGFP saga is going to take its place in the pantheon of high-profile white-collar fraud cases?

And while we're on the subject of Warin, here's another fun fact. In 2004, Washingtonian magazine compiled a list titled "Who to Call When You're Under Investigation." Guess who was on there.

Sounds like Cassano is a Washingtonian reader.

The non-partisan Congressional Budget Office (CBO) dealt a bad blow to the Obama administration's budget today, releasing projections that show the expected 10-year deficit to hit $9.3 trillion -- that's $2.3 trillion more than the White House's budget estimated last month.

In the age of trillion-dollar financial bailouts, one might ask, what's a couple of more trillions between friends? It means a lot to congressional Democrats, who are preparing to release their own budget outlines next week and need a large new deficit figure like they need a hole in the head.

To get an idea of the kind of heated (and rather hypocritical, coming from George W. Bush's party) rhetoric that's already coming out from GOPers on this issue, listen to Sen. Chuck Grassley (R-IA):

CBO's word is the gospel. Congress and the administration need to get the message. The buck stops with the American taxpayer. People can afford only so much government spending, even for the worthiest-sounding causes.


And here's how House Minority Leader John Boehner (R-OH) put it:

This report should serve as the wake-up call this administration needs. We simply cannot continue to mortgage our children and grandchildren's future to pay for bigger and more costly government.


To some extent, this is nothing new. Former President Clinton took a similar hammering in 1995 from then-GOP House leader Newt Gingrich when the Congressional Budget Office (CBO) came out with numbers that differed sharply from the White House's.

And that tale had at least a quasi-happy ending, with the nation heading into the black by the time Clinton left office. But in these recessionary times, the best President Obama can hope for is keeping his promise to halve the budget deficit over the next five years.

For a taste of how Democrats aim to counter-punch in the coming clash over the budget, check out the White House's official talking points on the new CBO figures. TPMDC has obtained a copy, which is posted after the jump.

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Sen. Chris Dodd (D-CT) just spoke to home-state voters about his sudden emergence as the scapegoat for the watering-down of his executive pay amendment to the stimulus bill -- and the Banking Committee chairman was openly angry with the Treasury Department for not owning up to its role in the flap earlier this week.

Dodd defended his role in ensuring that Wall Street compensation limits made it into the stimulus. The senator expressed disappointment that Treasury let him twist in the wind until yesterday evening, when Secretary Tim Geithner admitted that officials from his department requested that Dodd's amendment be changed to grandfather in existing bonus contracts.

We'll have the video of Dodd's comments for you soon, but here's his key quote:

I wouldn't go around and change my own amendment within days of that if I didn't think it was merely technical in nature.

And so I'm angry about it and angry that, in a sense, I've been held up as sort of responsible for all of this, when, in fact, I responded to what I thought was a reasonable request at the time [from Treasury] ... it turned out to be far more than that.


But this back-and-forth over the executive pay amendment isn't the only issue that could put Dodd at odds with Geithner and White House economic adviser Larry Summers.

As I mentioned earlier today, Dodd has been openly skeptical of consolidating future financial regulatory power at the Federal Reserve, preferring to run broader regulation out of the FDIC -- and that position may not sit well with Geithner, the former head of the New York Fed, as well as Summers, who is widely tipped to be the next Fed chairman.

Late Update: Here's the video of Dodd.

TPMLivewire