"American International Group will gain access to $30 billion more in taxpayer money as part of another restructuring of its federal bailout, the company announced this morning. It marks the fourth time the government has stepped in to help the ailing insurance giant since September," the Washington Post reports. "The reworked plan is aimed in part at helping AIG avert a potential disaster as the company on Monday announced the biggest quarterly corporate loss in U.S. history -- a staggering $61.7 billion for the fourth quarter of 2008, due largely to the continued deterioration of credit markets and charges related to AIG's restructuring."
The New York Times: "Federal officials, who worked feverishly over the weekend to complete the restructuring, said they thought they had no choice but to prop up A.I.G., because its business and trading activities are so intricately woven through the world's banking system. But the deal also presents more financial risks to taxpayers at a time when the public and Congress have been sharply questioning the wisdom of risking federal money to bail out private enterprises."
A source close the AIG deal tells First Read that it strengthens the company's restructuring efforts by protecting taxpayers from future losses and reducing the risk of further destabilizing the economy.
Per the Washington Post, Treasury Secretary Geithner and chief White House economic adviser Larry Summers have been busy men. "Last week alone, Geithner ran from meeting to meeting to craft a new rescue deal for Citigroup, talk with governors on the economic stimulus package, co-host a summit on the nation's fiscal issues, work with lawmakers on regulatory reform, refine a plan to help homeowners, discuss a major upcoming summit with his foreign counterparts and roll out the details of a 'stress test' for banks."
The New York Times examines Adolpho Carrion's stint as Bronx borough president and attempts to judge whether he's ready for his new gig in the White House as director of urban policy. "Assessing Mr. Carrión's readiness to make that jump depends on whether his tenure as borough president is seen as a hard-fought success in an office with limited power or a failed opportunity to turn around a borough that, while no longer a symbol of urban blight, continues to struggle with crime, poverty, homelessness and deaths from AIDS."
After their Sunday show appearances, Politico writes, "Defense Secretary Robert Gates and the chairman of the Joint Chiefs of Staff aren't on the same page regarding Iran's nuclear capabilities." Gates said on Meet the Press: "They're not close to a stockpile. They're not close to a weapon at this point," he said. Mullen said that "Iran may have enough nuclear material to make a bomb, the chairman of the Joint Chiefs of Staff told CNN's 'State of the Union' Sunday."
"The administration's top budget official, Peter Orszag, said Obama would sign the $410 billion spending bill despite a campaign pledge that he would reject tailored budget requests that let lawmakers send money to their home states," the AP writes. On the Sunday shows, both Orszag and Rahm Emanuel called the bill "last year's business."
Orszag also "said the White House would consider using a Senate procedural tactic so that only 50 votes would be required to pass major healthcare and energy reforms."
And here is the AP's table-setter on Clinton's trip to the Middle East. It notes that U.S. officials originally said it was giving $900 million to the rebuilding of Gaza. But now officials say $300 million is earmarked specifically for Gaza. Another $600 million is to go to the Palestinian Authority.