WASHINGTON –

President Barack Obama is trying to dampen a fire he once stoked, urging a more tempered response to public furor over bonuses paid to executives of the publicly rescued insurance giant American International Group.

Obama is virtually certain to use Tuesday’s prime-time news conference to continue an effort that began over the weekend: cooling the anti-AIG ferocity, now that it threatens to undermine his efforts to bail out the nation’s deeply troubled financial sector.

Obama’s tone changed dramatically after the House voted last week for targeted taxes to take back most of the $165 million in bonuses paid to AIG executives. Many lawmakers felt Obama had encouraged their step, because he called the bonuses reckless, outrageous and unjustified.

In the White House, however, the situation seemed to be spinning out of control. Some fellow Democrats questioned the constitutionality and wisdom of the House’s action. Executives of other troubled companies signaled they would not make deals with a federal government that revises agreements after they are signed.

On Sunday, Obama told CBS’ “60 Minutes” the House’s plan to slap a special tax on the AIG executives would be unconstitutional. Borrowing a line from his Feb. 24 speech to Congress, he said he would not “govern out of anger.”

In an essay that was published in 31 newspapers around the world Tuesday, Obama wrote: “Rigorous transparency and accountability must check abuse, and the days of out-of-control compensation must end. Instead of patchwork efforts that enable a race to the bottom, we must provide the clear incentives for good behavior that foster a race to the top.”

Meanwhile, top Obama spokesman Robert Gibbs said White House officials were heartened by the strong rally on Wall Street Monday in the wake of its announcement of a plan to work with private investors to sop up as much as $1 trillion in bad assets still held b y struggling banks.

But Gibbs also said Tuesday he believes the administration ultimately will be judged by its ability to restore a healthy economy, not on “what happens yesterday or today in the market.”

“I think the American people want to get back to sustained, long-term economic growth,” he said on CBS’s “The Early Show.” Gibbs said that’s precisely what Obama is focused on as the administration tries to jump-start the economy.

“Obviously we’re pleased by what happened in the market yesterday,” he said. But Gibbs added that “we don’t spend a lot of time worrying about what happens each day in the market.”

The political dance may be far from over as Obama continues to weigh the potency of public anger against the danger of overreacting and alienating bank executives whose cooperation is needed in the bid to get credit flowing again.

A mob can be useful in driving a political movement, “but its usefulness tends to dissipate when you’re trying to craft careful policy,” said John Feehery, a former aide to top GOP lawmakers. After playing into the public fury over the AIG bonuses for days, Obama and his allies “are in danger of being trampled by the mob,” he said. “They have to coolly explain what they’re trying to do.”

Earlier Monday, the White House said it will team with investors to initially buy as much as $1 trillion in bad assets from banks reluctant to make loans. The embattled treasury secretary, Timothy Geithner, asked for patience, saying such partnerships must proceed despite “deep anger and outrage” over the bonus payments.

For Obama, the challenge is to keep a pulse on the anger while giving the public time to calm down, and perhaps be distracted by other events in the coming days.

“It’s tricky, and the wind shifts very fast,” said Matt Bennett, vice president of Third Way, a pro-Democratic group. Obama quickly realized the virulence of the public’s anger over the AIG bonuses and the need to respond, he said.

“But I don’t think they anticipated what the House did,” Bennett said, and Obama was wise to stop short of explicitly embracing the legislation. Now, he said, the administration may have bought enough time to let tempers cool.

New York Attorney General Andrew Cuomo said Monday that 15 employees who received some of the largest bonuses from AIG have agreed to return them in full, totaling more than $30 million.

Congressional Republicans say Obama has contradicted himself and confused voters.

“We’re getting whiplash watching the administration careen back and forth,” said Antonia Ferrier, spokeswoman for House GOP leader John Boehner of Ohio.

Clearly the administration still sees the AIG issue as dangerous and sensitive. After the House vote last week, the administration said the action “rightly reflects the outrage that so many feel over the lavish bonuses” to AIG executives. But it stopped short of saying Obama would sign the bill, even if the Senate approves it.

On Monday, Gibbs continued to be evasive. “We will certainly evaluate whatever were to come down Pennsylvania Avenue” from the House and Senate, he said.

His comments were more tepid than those Obama made a week earlier. Then, the president said he had directed Geithner to “pursue every legal avenue to block these bonuses and make the American taxpayer whole.”

Some congressional Democrats are pursuing strategies that might get Obama off the hook by using bureaucratic powers â not legislation he would have to sign or veto â to rescind all or part of the AIG bonuses.

Sen. Mark Warner, D-Va., has asked the U.S. Office of Thrift Supervision to block the AIG bonuses under its power to move against a lender’s actions that are deemed “unsafe and unsound.”

The OTS says it lacks such authority over AIG because the massive federal loan, which essentially gave the government majority ownership of the company, changed the company’s charter. Warner, a member of the Senate Banking Committee, has asked the office to explain and defend its conclusion.

Archived comments

you mean he was for the furor before he was against it?

bouldermeister

3/24/2009 11:44:52 AM

“Congressional Republicans say Obama has contradicted himself and confused voters.

“We’re getting whiplash watching the administration careen back and forth,” said Antonia Ferrier, spokeswoman for House GOP leader John Boehner of Ohio.”

LOL…. so what else is new?

bobcat77

3/24/2009 11:47:32 AM

Pull the plug already, and let the sewer(s) drain. Bailing these banks out only re-floods them again.Let them die and die fast.

Big Media. Big Agro. Big Pharma. Big Army. Big Financial. Take your pick.Big (political) Party. Big is Bad.

Break ’em all up.

motiff

3/24/2009 12:09:08 PM

“you mean he was for the furor before he was against it?”

Good one!

zone913inc@aol.com

3/24/2009 12:13:34 PM

The usual wingnuts and know-nothings aspire in vain to relevance and “LOL” at their own lame jokes.

Dr_Johnson

3/24/2009 12:39:34 PM

Talk about a rudderless ship.

Hey Doc, why don’t you just wait a couple of years and then opine with your typical, left-winged, banalities, offering nothing, just like Obama, to fix this mess.

Do you spend others money like that at home?Nevermind,get back to me in a million years.

You on the far left are just as bad as the “wingnuts” you talk about, in the meantime, those of us in the middle are getting stuck like pigs.

Viper1963

3/24/2009 1:06:09 PM

…you mean he was for the furor before he was against it?”..

No he was always against it.It was a test.

thesurfrider

3/24/2009 1:15:34 PM

…”We’re getting whiplash watching the administration careen back and forth,” said Antonia Ferrier, spokeswoman for House GOP leader John Boehner of Ohio.”…

That is because you are not driving the boat anymore.You lost.You are along for the ride.

thesurfrider

3/24/2009 1:16:53 PM

“You on the far left are just as bad as the “wingnuts” you talk about …”

The “you’re as bad as we are” ploy is getting a bit stale.

From the standpoint of the paranoid Right, about 95% of the world is the “far left.”

Dr_Johnson

3/24/2009 1:37:17 PM

This only reinforces the suspicions that this administration has no real plan. Only a strategy of throwing darts at any place where they feel they can gain some political capitol. Only an idiot gets excited at huge swings in the market. It is an indicator of huge insider fueled speculative trading. It is nothing more, or less than a hit and run tactic. The fundamentals are totally out of balance, and that makes it all but imposable for the market to reach a point of balance, and until that happens, sustainable gains do not happen. What are these inexperienced fools so excited about. Housing posted a 6.3 percent decline for Jan. GM slashed another 120 jobs, Crude oil posted another big gain closing at $54.00 a barrel,and unemployment, one of the main indicators of a stable economy is at all time highs. If we do not take on a more sustainable and less rhetorical approach soon, the results will be disastrous. If you are speaking to our new president, please pass on to him that although I didn’t vote for him, We are all kind of waiting for him to show some much needed leadership. That is a big part of the job you know. Not just the much ballyhooed showmanship that we are all getting a bit tired of.

biker_joe

3/24/2009 2:05:22 PM

You can’t have the President blasting the “evil and greedy” people on Wall Street at the same time the Treasury Secretary is begging the “evil and greedy” people on Wall Street to buy toxic assets from crippled banks.Wall Street’s fear is that if they make a huge profit by buying these toxic assets, Congress could hit them with a retaliatory tax.So, Obama had to change his tune.It would be nice for some consistency though.

gsegiet@flash.net

3/24/2009 2:37:51 PM

“We are all kind of waiting for him to show some much needed leadership. “

Too bad you can’t just STFU while you’re doing it.

Congressional Repugs, and their orcs in comment land, have no plan except to drag their feet and pray for disaster.

Dr_Johnson

3/24/2009 3:10:55 PM

he doesn’t like me because people actually laugh at some of the things I say.

But forgive the Dr, he’s a good man, just an obamabot, fully trained in the “your either with us or you are a republican” mantra.

bouldermeister

3/24/2009 3:13:28 PM

“he doesn’t like me because people actually laugh at some of the things I say.”

Yes, real sharp tacks like bobcat. Give yourself one-half an attaboy.

Dr_Johnson

3/24/2009 3:17:05 PM

Hey dock, unlike you, I recognize that everyone out here has the right to voice their opinions. The STFU is just one more cheap excuse for those lacking the ability to deal with issues in a logical and cogent manner. I believe that a remedial education most likely was your rout to a doctorate. What did you do your thesis on. How to talk louder and win approval by saying bla bla bla, every time someone had something to say that you just couldn’t stand to hear. Get a life dude, your Messiah is heading for Crucifixion as we argue the point.

biker_joe

3/24/2009 4:07:10 PM

I hope the plan works, but I’d still like to see Wall St execs get sacrificed as a warning to not let this happen again.

I know that life is not fair, but I still think these Wall St crooks are getting a slap on the wrist and will just go back to the same shifty business practices that tanked our economy in the first place.Plus they are coming out of this millions richer while giving the shaft to the rest of us.

If a regular person did something like this, he or she would be someone’s B$#ch while busting rocks in the State Pen.

Where is Tyler Durden when we need him?

Jadam12

3/24/2009 4:10:29 PM

“Hey dock, unlike you, I recognize that everyone out here has the right to voice their opinions. The STFU is just one more cheap excuse for those lacking the ability to deal with issues in a logical and cogent manner. yammer yammer yammer”

Very funny. Another angry pinhead blows his tiny load.

Which he has a perfect right to do.

Dr_Johnson

3/24/2009 6:03:24 PM

And to think it was only Saddam Hussein who once stood in the way of our greatness!

cordymac@hotmail.com

3/24/2009 6:19:07 PM

biker_joe:Perhaps Dr_Johnson was indicating you’ll get farther in life if you actually have a logical and cogent opinion.So far, you don’t.

Of course, you do have the right to continue with your burnt out biker ravings, as previously noted.

And, here’s some free advice-proofread your diatribes, and do a spell check, before you post them.Thank you.

4.4Forty@gmail.com

3/24/2009 7:54:35 PM

Bend Over & Say, “Uncle Sam”

http://informationclearinghouse.info/article22289.htm

***

cordymac@hotmail.com

3/24/2009 10:42:39 PM