First, ordinary Americans should get angry at the CEO's decision to give out money to losers. I'm angry. With angry people, there is a chance that anger might get directed at Obama or congress. While technically the TARP funds were approved under Bush, most people won't remember that. So with angry people, Obama has to do something. If he doesn't he will be seen as not standing up for the principles he campaigned on. Definite problem.
Second, the public is starting to get tired of bailouts/stimulus. Obama will most likely need to give out more money in the future (car companies, another TARP payment, etc) So with the public souring on the free money give-away, he might suffer a backlash if he gives out more money and this happens again.
What can Obama do. Well, he's doing it already. He has stated publicly that he will try and stop them. Good start. Then, there have been a chorus of dems stating they will do what they can to stop the bonuses. Examples:
House Speaker Nancy Pelosi (D-CA) has said she will get them back. One way or another
Rep. Carolyn Maloney (D-NY) has stated she will tax 100% of the bonuses
There are more dems to come also. Why should all dems come out against this? It looks bad if congress does nothing. So they need to do something. Now, I hope it is not political grandstanding. I really do hope they are standing up because it is bullshit that AIG did this.
Update: The Post has an article describing how people's anger might be hurting Obama's agenda.
"The populist anger at the executives who ran their firms into the ground is increasingly blowing back on Obama, whom aides yesterday described as having little recourse in the face of legal contracts that guaranteed those bonuses."
