Read the transcript below:
March 16, 2009 4:03 PM TAPPER: You guys first found about these bonuses last week?
GIBBS: I think that's true, based on what I read in the newspaper.
TAPPER: But you gave money to AIG two or three weeks ago?
TAPPER: How could you not know that they have these millions -- hundreds of millions dollars...
GIBBS: Well, again, there's -- there's -- according to the news reports, there's existing contracts, some of which the -- or of which the president has asked the secretary to examine going forward. I think you also heard the president speak today about having a resolution authority that gives the government and taxpayers far more flexibility in dealing with the disposition of AIG in a way that gives taxpayers protection and flexibility -- disposition that we don't currently have, but steps that we would like to see taken in order to deal with AIG as a whole.
TAPPER: Why didn't you attach it to the $30 billion you gave a couple weeks ago?
GIBBS: Again, Jake, the...
TAPPER: You're looking to retroactively attached it to the new $30 billion.
GIBBS: Well, they're looking through contracts to see what can be done to wrest these bonuses from their recipients.
TAPPER: I'm sorry, just -- I don't understand, so maybe I'm just not understanding, but President Obama said in early February, right when he gave his speech on executive compensation, “these kinds of compensation packages in the midst of this economic crisis isn't just bad taste, it's bad strategy, and I will not tolerate it as president. We're going to be demanding some restraint in exchange for federal aid.” Since that time, he gave tens of billions of dollars in federal aid to AIG without demanding restraint.
GIBBS: Well again, Jake, we've got existing relationships, contracts, as I just mentioned, that were negotiated a year ago, assistance that was granted outside of the legal authority prior to the creation of the troubled asset relief program. The president has asked the administration to go back and look at what remedies are possible to block those bonuses.
TAPPER: But why didn't he do that before?
GIBBS: Well, again, the excessive compensation rules that you'd noted, and I think somebody asked this at the background briefing that we had, obviously are prospective based on some limitations that we have in looking backwards. The president has asked Secretary Geithner and members of the administration to exhaust all legal remedies in looking backwards to see what steps could be taken to block these bonuses.
TAPPER: No, but since -- and I'm sorry to belabor this point -- but since President Obama gave the speech, you guys gave more money to AIG. Why wasn't it attached...
GIBBS: Again, this is...
TAPPER: ... to the new money?
GIBBS: Because it's, again, it's part of the...
TAPPER: Part of the old contracts.
GIBBS: Right. It's part of...
TAPPER: But you're looking to now retroactively see if you can attach something to that old money.
GIBBS: That's what we're looking at.
TAPPER: But why didn't you do it at the time, if you're looking to retroactively do it.
GIBBS: The administration is taking the steps today to go back and see what can be done…to claw those bonuses back