Washington (CNN) – Democratic leaders scrambling to strip AIG executives of bonuses are having a hard time answering a key question – why didn't Congress act to prevent the bonuses in the first place?
"There's always more we can do, and hindsight is 20/20," was all Senate Majority Leader Harry Reid would say Tuesday.
But the reality is that when lawmakers did move to prevent bonuses in the stimulus bill last month, they actually made an exception for pre-existing contracts, effectively exempting AIG.
Senate Banking Committee Chairman Chris Dodd, D-Connecticut, who originally proposed the executive compensation provision, did not include the exemption clause, which said new rules "shall not be construed to prohibit any bonus payment required to be paid pursuant to a written employment contract executed on or before Feb. 11, 2009."
In an interview with CNN, Dodd denied inserting that exemption at the 11th hour, and insisted he doesn't know how it got there.
WASHINGTON (CNN) – Vivek Kundra, the Obama administration’s new chief information officer, has returned to work, CNN has learned.
Related: Obama CIO on leave during investigation
Kundra went on a leave late last week after the FBI raided his former work place, the technology office of Washington, D.C.’s local government. A law enforcement source with knowledge of the investigation told CNN last week at the time of the raid that Kundra is not involved in the case.
“Mr. Kundra has been informed that he is neither a subject nor a target of the investigation, and has been reinstated,” Assistant White House Press Secretary Nick Shapiro told CNN in an e-mail Tuesday.
Related: FBI searches Washington technology office
Updated: 7:01 p.m. with Shapiro statement.
WASHINGTON (CNN) - Michelle Obama lent a hand Tuesday, pitching in to help build an affordable, energy-efficient home on the National Mall in Washington.
The first lady participated in an event marking the 30th anniversary of YouthBuild, a non-profit community development program that teaches low-income youth housing construction skills while they work toward their GED or high school diploma.
“Thirty years of anything is an amazing feat, but walking through these displays and talking to some of the most intelligent, focused, knowledgeable young people, that makes me proud - it should make this country proud,” the first lady said at Tuesday's event.
Mrs. Obama praised YouthBuild's community service effort and delivered a message to the program's participants: they can rebuild their lives and help others in the process.
"Its your core principle that I am so impressed with, providing opportunities for amazing young people,” she said as the crowd cheered. “Giving folks a second and third and fourth, chance particularly to low-income youth, sometimes we overlook them."
Mrs. Obama, who previously worked as a community-organizer in Chicago, worked to construct a three bedroom home for a single mother whose Texas residence was damaged by Hurricane Dolly.
(CNN) – Sen. Charles Grassley is standing by his earlier comments suggesting some embattled AIG executives should "resign or commit suicide," but told CNN Tuesday he was merely speaking rhetorically.
"Of course I don't want people to commit suicide," the Iowa Republican said. "But I do want an attitude in corporate American that's similar to what they have in corporate Japan.
"[In Japan], people that run a corporation into a ground have violated their trust with the stockholders and maybe even the taxpayers - they take a very deep bow, they apologize, they are remorseful, they are contrite, they take full responsibility," he added. "We have not heard the sort of apology, remorsefulness, contrition, that we ought to hear from corporate executives in America assuming full responsibility."
Grassley's initial comments came Monday afternoon during an interview with Iowa radio station WMT. During the interview, Grassley endorsed what he viewed as Japan's corporate model, saying it is customary for failed executives to either relinquish their posts or commit suicide in disgrace.
"In the case of the Japanese, they usually commit suicide before they make any apology," he said during that interview.
A spokesman for AIG called Grassley's initial comments "very disappointing."
(CNN) - As the race in New York’s 20th congressional district continues to tighten, the Republican National Committee is sending another $100,000 to the state party in New York - the second time in less than a week it’s spent that sum on the special election contest there.
The move comes a day after GOP New York assemblyman Jim Tedisco, running for Democratic Sen. Kirsten Gillibrand’s former congressional seat, told reporters he would have voted against the stimulus bill.
Questions over Tedisco's position - he had earlier suggested he would have supported a modified version of the legislation - had dogged the candidate for days.
Last Thursday, the RNC announced the transfer of $100,000 to the New York State Republican Committee, as fresh numbers showed a vanishing advantage for Tedisco in the March 31 special election.
A Siena poll released the same day suggested his lead over Democratic venture capitalist Scott Murphy had plummeted by two-thirds over the past two weeks, to just 4 points, despite the district's traditionally Republican bent.
WASHINGTON (CNN) - Veterans groups are angry after President Barack Obama told them Monday that he means to go ahead with a proposal to have treatment for service-connected injuries charged to veterans' private insurance plans.
Leaders of the country's most prominent veterans groups met Monday at the White House with Obama, Veterans Affairs Secretary Eric Shinseki, White House Chief of Staff Rahm Emanuel and Steven Kosiak, the director in charge of defense spending for the Office of Management and Budget.
Some of the veterans groups were caught off guard when the president said the administration wants to go ahead with the idea as a way of generating $540 million for the Department of Veterans Affairs in 2010. The groups and some members of Congress have been very vocal in opposing the idea.
The message, according to some of the people in the room, was that if the groups do not like this idea, they need to come back with another way of saving or raising revenues for the VA.
(CNN) -- Laura Ingraham is calling Meghan McCain a "useful idiot" and a "flavor of the month" - the latest salvo in the war of words between the conservative radio host and the daughter of former Republican presidential candidate John McCain.
"Memo to Meghan McCain: Enjoy the media coverage while it lasts, but know you're being used," writes Ingraham, in a blog post titled "'USEFUL IDIOT' WATCH." "You are the flavor of the month in left-wing media land because you are a Republican bashing the GOP. Likewise, your dad is most popular among the same people when he is slamming his Republican brethren in full-blown 'maverick' fashion. At least he backs up his views with a lifetime of sacrifice and public service.
Ingraham says liberals are taking a single satirical comment out of context "to paint Meghan as the victim of a right-wing hate crime" and "malign outspoken conservatives."
The radio host mocked McCain on her show last week over comments urging Republicans to seek compromise with Democrats. She referred to McCain “a Valley Girl gone awry” and a “plus-sized model.”
Ingraham calls the furor over her remark "manufactured and totally phony."
"This comes from the same playbook responsible for the ongoing demonization of Rush Limbaugh," she writes.
"If any off-the-cuff remark about a woman's size was condemnable, then where was the outrage when President Obama made a passing reference to Jessica Simpson's 'weight battle' during his Super Bowl interview with Matt Lauer?" she asked, referring to a headline the president noted on a magazine cover during his interview with the NBC anchor.
Ingraham pointed to digs Rush Limbaugh has gotten over his weight, and references to herself and Ann Coulter as "peroxide blondes."
(Update: John McCain responds after the jump)
WASHINGTON (CNN) - Congressional Republican leaders made headlines on Monday when they announced that Alaska Gov. Sarah Palin would be the keynote speaker at a major fundraising dinner in June. But it appears the former vice presidential nominee's political staff never told her.
Bill McAllister, a spokesman for the governor, said she was aware of the invitation, but that she had not actually accepted it.
"I communicated with the governor directly and she did not know anything about it," McAllister told the Anchorage Daily News in a story published Tuesday. "I pointed out the (National Republican Senatorial Committee) press release and she was like, 'No.'"
The dispute appears to stem from a miscommunication between Palin's gubernatorial staff and aides that work for her political action committee, SarahPAC. Palin created SarahPAC in part to pay for out-of-state political travel.
NRSC spokeswoman Amber Wilkerson said the booking was approved by SarahPAC, but that the governor's staff had not been made aware.
McAllister told CNN that "the governor herself had not confirmed," but left open the possibility that she will still speak at the fundraiser. "As far as I know, it's still under review," he said in an e-mail.
(CNN) - Ohio Gov. Ted Strickland's approval rating has taken a hit as he grapples with a flailing local economy a massive budget shortfall, according to a new poll.
In a Quinnipiac Survey released Tuesday morning, the Ohio Democrat's approval rating stands at 56 percent - seven points less than it was one month ago.
The poll also shows divided opinion over the governor's proposal to use close to $7 billion of the federal stimulus package and a portion of the state's rainy day fund to meet the budget gap.
The poll, which surveyed 1,299 Ohio voters, was conducted from March 10-15 and carries a margin of error of plus or minus 2.7 percent.
Strickland faces reelection in 2010.
WASHINGTON (CNN) – A new national poll indicates that support for the stimulus plan that passed Congress last month is dropping and suggests that there is no appetite among Americans for another spending bill.
But the CNN/Opinion Research Corp. survey released Tuesday finds that most Americans favor President Barack Obama's overall economic proposals.
Sixty-five percent of those questioned in the poll say they support Obama's economic plan, with 34 percent opposed. But support for the $787 billion stimulus package, which aims to pump up the economy and create jobs by increasing federal spending and cutting taxes, now stands at 54 percent. That's a drop of 6 points from last month.
Americans appear to be split on whether the stimulus will significantly improve the country's economy, and two-thirds of those polled say they're opposed to a second stimulus if the first one doesn't boost economic conditions.