WASHINGTON (CNN) - Key Republicans on Capitol Hill Wednesday blasted the Treasury Department and the Federal Reserve for orchestrating an $85 billion bailout of insurance giant American International Group.
The criticism came a day after lawmakers were surprised by the news that taxpayers would again be called on to shore up a member of the struggling financial sector.
"Once again the Fed has put the taxpayers on the hook for billions of dollars to bail out an institution that put greed ahead of responsibility and used their good name to take risky bets that did not pay off," said Sen. Jim Bunning, R-Kentucky, a member of the banking committee.
A spokesman for Sen. Richard Shelby of Alabama, the top Republican on the banking committee, said the senator "profoundly disagrees with the decision to use taxpayer dollars to bail out a private company" and is upset the government has sent an inconsistent message to the markets by bailing out AIG after it just refused to save investment bank Lehman Brothers from bankruptcy.
"The American taxpayer should not be asked to unwillingly assume the inordinate risks that financial experts knowingly undertook, particularly when taxpayer exposure is increased by the ad hoc manner in which these bailouts have been engineered," said Shelby's aide, Jonathan Graffeo.
A top House Republican, Rep. Roy Blunt of Missouri, complained about not getting advance notice of the bailout and said House Republicans are struggling to "understand a coherent strategy" about which firms get rescued and which ones don't.
Rep. Adam Putnam of Florida, the third-ranking Republican in the House, said the cost is "unnerving" and called on the Treasury Department and Federal Reserve "to dispatch an envoy to the Hill to bring members of Congress up to speed."
"The communications lines are not operating efficiently," he said.
Late Wednesday, the White House agreed to send a top Bush economic advisor and an official from the Fed to brief House Republicans Thursday, according to a House GOP aide.
Meantime, congressional Democrats placed the blame for the crisis squarely on the Bush administration, arguing it failed to aggressively regulate the financial industry.
"The most recent bailout initiated by the Bush administration - that of AIG - is just another example that George Bush is a failed manager," said House Speaker Nancy Pelosi, D-California. "Because of the inattention, or a decision on their part to have crony capitalism in our country, Americans across the country are feeling the pain of this."
Pelosi said two House committees will investigate the recent bailouts "to tell us how we can avoid this in the future, what went wrong here and also to look into this issue of fraud and mismanagement" at AIG.
White House spokeswoman Dana Perino said Congress could have done more to head off the crisis.
"I think that Congress needs to take - before they start throwing arrows - take a little bit of time for some self-reflection. But also, why don't we just set that aside for a minute and focus on the fact that we have a crisis that we're trying to manage."
Senate Majority Leader Harry Reid - who also complained that he didn't know a bailout of AIG was in the works - said Congress won't change laws immediately to address the rapidly unfolding financial crisis because "no one knows what to do."
"We are in new territory here," Reid added. "You could ask (Federal Reserve Chairman Ben) Bernanke, you could ask (Treasury Secretary Henry) Paulson. They don't know what to do but they are trying to come up with ideas."
He said he will keep the Senate in session through the end of the year so committees can hold hearings and start writing legislation that he said could become law next year.
"It's a multitrillion-dollar issue that's facing America and we can't do it in some timeline that is unrealistic," Reid said.
Spare me the phony outrage. The Bush Administration and their Republican flunkies are complicit in this. Phil Gramm and his wife Wendy are at the heart of this economic disaster.
"A top House Republican, Rep. Roy Blunt of Missouri, complained about not getting advance notice of the bailout and said House Republicans are struggling to "understand a coherent strategy" "
Struggling to understand a coherent strategy-Sounds like the new Palin/McCain slogan.
I find it laughable that the republicans are arguing with the goverment for bailing out AIG. We will not be in this mess if republicans agreed to regulate the markets. If the goverment was monitoring the actions of wall street, then the economic mess we are in would not have ocurred. The repblicans should take responsibility for their failed actions in regulating the markets. In that case, they should be thrown out.
So they would also be against bailing out oil companies by giving them astronomical tax breaks proportianately compared to those given to us common folk?
If so, blast McCain's economic basis. Otherwise...STFU and stop trying to fool us with your false policies that are suddenly "DIFFERENT then yesterday"
Funny, considering all those CEOs will be voting Republican.
not to worry......when Osama and the Demotax party get done with you...........you wont have any more money to lose
SOVERIGN FUNDS WILL COME NEXT TO HELP IN THE BAIL OUT AND THAT'S A BIG MAYBE.
You have got to be kidding me!
Republicans-Start by thanking your buddy Phil Gramm for brining in the legislation for starting this mess. Then thank George Bush for ignoring the problem and allowing Wall St. to police itself.
You guys have nothing to be outraged about. You guys wanted to privatize Social Security and leave it in the hands of these people you now call "greedy".
Patriotism; John F. Kennedy
Ask Not What Your Country Can Do For You, But What You Can Do For Your Country.
Appropriate regulations which Obama proposed two years ago would have avoided what becomes neccessary now. It is sad for the taxpayer but anything else would be even worse.
1. What kind of experience do you all mean when you say that Obama doesn't have experience?
2. Why did John McCain really pick Sarah Pailin?
Someone please answer.
The republican...the republicans...the republicans....
IT'S CONGRESS PEOPLE – the one headed by democrats!
AIG wouldn't have been able to take in such crappy loans had it not been able to deal with shills like freddie and fannie which avoided GOP backed increased oversite because of DEMOCRATIC stonewalls.
Obama's advisors made millions from freddie and fannie! Obama recieved boat loads of cash from them. How convienient, yes?
We should not have bailed out AIG however I will never lower myself to be scum by becoming democratic.
Heck! I thought the Republicans were in power for the past 8 years.
Maybe some regulation would have helped PROTECT OUR TAX DOLLARS!
Obama proposed squat on regulation...quit feeding these peoples lies.
Just like he's pumping himself up by claiming he had anything to do with the latest stimulis package.
I suggest that people get all the facts on AIG and Lehmann Bros. and all the other bailouts and figure out why some might be good for taxpayers while others would be bad for taxpayers. I suspect this article will attract only comments from people who don't understand anything about the details of the "bailouts" and speaking from ignorance is not normally a reasonable approach to solving a problem.
Continue to press McCain on his consistent claims of being a deregulator. It's unbelieveable that he is now coming out in favor of regulation. It's like his drill now mantra. He sees a way to gain favor with the public and so he is supporting offshore drilling. Will the voters fall for it? Not if the media does its job. How about it journalists!
It's your Republican Admisistration...live with it!!!!
Well, well. It looks like I have some things in common with the GOP. Well, technically, I agree with them on most of the things but the point is that times have changed.
Even I can't control that...
so? republicans are mad at the republican government ,that they supported over and over on policy and blamed on democratic congress in control the last 1 1/2 years? that dont make no sense?
1. What kind of experience do you all mean when you say that Obama doesn't have experience?
He's never run anything in his life except a campaign. He's never been in charge of anything or anyone other than his family...and that's debatable. He's done nothing remarkable in the state legislature or congress except campaign.
He's been campaigning his entire career...
It's a joke that McCain is taking credit for warning Congress about the pending crisis two years ago. He must be confusing himself with Obama, who really did try to get Congress to act two years ago while McCain was still in his deregulation mode. Voters, please check the facts. McCain's lies are coming fast and furious now, on a daily basis. It would help if the media kept up with them all.
FOLLOW the MONEY
Check and see the total cash given to BUSH BOTH times he ran for the whitehouse and to McCain THIS time and you will see WHY Bush did what was NEVER done before and was NEVER meant to be done EVER!
Simple as that. I want MY money back!!!!
McCain also told the audience that "Sen. Obama's own advisers are saying that the crisis will benefit him politically."
From CNN.Com: "A McCain campaign spokesman could not point to any specific instance of an Obama adviser or surrogate making such a comment about the Wall Street crisis in recent days."
MCain just makes stuff up. He (they) made up Lying Plain Sarah and he has made this up. Wake up America! This man has nothing to offer except his imagination!
What a joke that McCain is taking credit for warning Congress about the pending crisis two years ago. He must be confusing himself with Obama, who really did try to get Congress to act two years ago while McCain was still in his deregulation mode. Voters, please check the facts. McCain's lies are coming fast and furious now, on a daily basis. It would help if the media kept up with them all.