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Rep. Spencer Bachus (R-AL) just raised a new objection to the AIG counterparty payments--specifically that while AIG used government money to pay off their CDS obligations dollar-for-dollar to major (sometimes foreign) financial institutions, it repaid smaller U.S. institutions that made secured loans to AIG subsidiaries at a rate of only about 20 to 30 cents on the dollar.

Video forthcoming, but Geithner had no immediate answer to the query, which, to amateur ears anyhow, sounds like an interesting one. We'll follow up.

Late Update:

That AIG Financial Products trader who resigned -- and stridently refused to return his million dollar bonus -- in yesterday's New York Times, apparently gave some notice. Yesterday, in latest installment of the Wall Street Ends Its Contrite Silence trend we highlighted yesterday, the Wall Street Journal reports, he showed up for work to a standing ovation! And conspicuously not sitting out the ovation was AIG FP president Gerry Pasciucco. Wow it is just like that scene in Dead Poet's Society!

A less inspiring trend DeSantis' resignation highlights is this: AIG is hemorrhaging executives as fast as it is money, and if the company is to be believed the losses will cost the system hundreds of billions more dollars. In fact, the loss of two Paris-based executives, James Shephard and Mauro Gabriele, could trigger nearly a quarter trillion dollars in defaults. Say that again?

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One of the few growth industries in the current economic climate? Fraud investigators.

Allegations of fraud are increasing, as the financial crisis drags on. As a result, reports the New York Times, people who are skilled at following the money have rarely been more in demand.

The FBI is recruiting new hires to work on a glut of cases -- it had more than 1600 open mortgage-fraud investigations at the end of fiscal 2008, almost twice as many as two years earlier.

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Treasury Secretary Timothy Geithner is back before the House Financial Services committee today to argue the case for greater federal regulatory power over non-bank financial institutions. In many members' minds, though, he's still on the line for the AIG bonus flap and for allowing bad financial actors to take too big a role in shaping bailout policy.

The outline of the Treasury's new regulatory reform framework is here. We'll keep a close eye on his testimony.

Some mid-level civil servant in the Office of Management and Budget must be getting a lot of flack. To recap, according to OMB director Peter Orszag, a bureaucrat in his agency communicated to the Pentagon that the administration wanted to scrap the term Global War on Terror (GWOT) and replace it with the term Overseas Contingency Operations (OCO).

The only problem is, the administration had no such plans. Or so they say. But the memo went out anyhow, and now it seems to be causing, if not confusion, then at least minor head aches for government spokesmen and other officials.

At yesterday's Pentagon news briefing, a reporter asked Pentagon Press Secretary Geoff Morrell about this very issue:

Q (Off mike) -- e-mail sent, from the Obama administration to Pentagon officials, about using the phrase the global war on terror, to using overseas contingency operations.... MR. MORRELL: I've never received such a directive. I think the White House and OMB for that matter have been very clear about this as well, that they have never issued such a directive. I think they've explained that perhaps somebody within OMB may have been a little overexuberant and done so. But I can just tell you, I'm the one who speaks publicly about these matters. And I have never been told which words to use or not to use. So I don't think there's anything to the story....

Q What's your preferred nomenclature?

MR. MORRELL: I don't really have one....

Q (Off mike) -- GWOT, global war on terror, lumps together an entire -- you know, the entire Muslim faith and an entire region. Do you see that as a concern? MR. MORRELL: Well, I don't think there's anything in that term that identifies any particular faith or ethnicity. I mean, there are terrorists of all faiths, of all colors, of all races and ethnicities. And so perhaps a better -- another way to refer to it would be, you know, a campaign against extremists who wish to do us harm.


Emphasis mine. So the new term is "Campaign Against Extremists Who Wish To Do Us Harm. CAEWWTDUH. That's not quite as economical as GWOT, or OCO, but it's better than George Bush did when he tried to rename his war on terror on the fly.

Full exchange after the jump.

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My colleague Eric noted this story in the Morning Roundup, but it's worth noting that the Congressional Progressive Caucus still doesn't appear to be waking up to its potential to influence the Obama administration's agenda.

As Roll Call notes, the president has given White House face time to all manner of Democratic klatsches, from the business-friendly Blue Dogs and New Democrats to the Congressional Hispanic and Black Caucuses. But the Progressives' request for a meeting with Obama -- which TPMDC noted a long while back, right here as well as here -- has fallen on deaf ears.

Anyone who thinks progressives don't need to assert themselves, that they can best help Obama advance his priorities by being supportive and avoiding the appearance of nitpicking or spotlight-chasing, should read the call-to-arms that TNR's John Judis delivered to the left last month.

By allowing Republicans to define Obama's goals (his budget in particular) as the most liberal option on the table, Judis explains, progressives risk standing pat while the president gets pigeonholed as a debt-hungry lefty. Unfortunately, the Congressional Progressives have yet to speak with the unified, assertive voice that Ble Dogs and New Dems use. From Roll Call's report:

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There was minimal rancor yesterday over House and Senate changes to President Obama's budget proposal. In fact, there was almost no rancor at all. Instead, the administration and Harry Reid and conservative Democrats in the Senate seemed all too thrilled with one another.

That will please some liberal grassroots organizations, and should be of particular interest to a campaign called Rebuild and Renew America Now, comprised of over 40 progressive interest groups aligned to usher Obama's budget through the Congress largely unmolested.

David Elliot, communications director for the group USAction, a member of the campaign, says the members (or as many as possible) convene for a daily 10:30 a.m. conference call to discuss budget issues and strategy.

Among their considerations is the crucial role Blue Dogs and conservative Democrats will play in the passage (or blockage) of Obama's agenda. For its part, USAction began airing ads in the districts of conservative Reps. Marion Berry, (D-AR), Allen Boyd, (D-FL), Charlie Melancon (D-LA), Bob Etheridge, (D-NC), and Chet Edwards (D-TX) urging them to "resist special interests and vote for [Obam's budget]. All of them serve on the House Budget Committee. Four of them officially belong to the Blue Dog Caucus.



Similarly, the labor-backed group Americans United for Change (also part of the Renew and Rebuild campaign) went live with ads today in 11 states and Washington D.C. to pressure critics like Kent Conrad and the newly christened Moderate Dems Working Group to support Obama's budget.

These efforts might seem bold and risky, but Elliot says there's little discord within the campaign itself over tactics and organizing. By contrast there is some disagreement within the ranks of a different (somewhat overlapping) umbrella group called Unity '09, which is also dedicated to moving Obama's agenda through Congess. Some Unity participants are much less suspicious of the Blue Dogs and their Senate peers, and have been heavily critical of efforts to pressure them.

As it happens, Conrad released his proposed tweaks to Obama's budget yesterday, and, despite making relatively few substantive changes, he seems to have won for now the support of many of its critics.

Full list of Renew and Rebuild America Now member organizations below the fold.

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Vice President Joe Biden is now wading into this Tuesday's special election for Kirsten Gillibrand's former House seat, with this new radio ad for Democratic candidate Scott Murphy:



Biden plays up the issue that has become Murphy's signature approach, support for the stimulus package: "He knows people have to work together to get things done, and he'll work with Democrats and Republicans in Congress to get things done for Upstate New York. That's why Scott supports our economic recovery plan, because it means 76,000 jobs for Upstate and funding for schools, which helps keep property taxes down. We have a lot of work to do, and Scott will help get it done."

Yesterday, President Obama sent out an e-mail officially endorsing Murphy, and asking his own supporters in and around the district to help out.

Consider this your meta-meta-post for the day: Obama took a jab at beltway media culture last night in a speech he gave at a Democratic National Committee fundraiser, and by all accounts, he knows what he's up against. But unfortunately he can't seem to get away from it.

I know that in Washington sometimes it's easy to get caught up in the day-to-day cable chatter, and be distracted by the petty and the trivial, and everybody is keeping score -- are they up, are they down? You know, one day I'm a genius; one day I'm a bum. Every day there's a new winner, a new loser.


Sounds right. And knowing the deaf and recursive world of D.C. media so well, he shouldn't be too surprised that Politico's Alexander Burns was there to turn an aside in a speech about the economy into a blog post about Obama taking aim at political Washington. And he shouldn't be too surprised either that Mike Allen cited the post in his daily playbook of news-driving events--that now his critique of the daily winners and losers chatter will be used by the people he was critiquing to determine if he won or lost the day.

Obama's made this point before, and to the same effect (or lack there of). Just as in months past, everyone's writing about it and nobody's taken Obama's critique to heart and if he speaks up and makes the same argument again, we'll all go down the rabbit hole once more.

He fought the law, and he lost. Faron White, a former north Alabama police officer, pleaded guilty Wednesday to stealing $60,000 from the police department where he was a sergeant, feigning his abduction, and fleeing to Las Vegas. White faked an elaborate struggle in his Alabama office to divert would-be pursuers but was found only three days later in Sin City. White, who was once named officer of the year by the Decatur Police Department, also said that a former citizen volunteer from the organized crime unit that he supervised aided his escape plan. White faces up to ten years in prison and a fine of $250,000. (Associated Press)

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