Obama to seek ‘every single legal avenue' to block AIG bonuses

By Margaret Talev and Kevin G. Hall

McClatchy Newspapers

(MCT)

WASHINGTON _ President Barack Obama said Monday that he will seek "every single legal avenue" to block the payout of $165 million in bonuses to executives of disgraced insurer American International Group, a company that U.S. taxpayers are bailing out.

Obama unleashed his criticism in the White House East Room, eclipsing an event where he announced $15 billion in new help for small businesses hurt by the recession.

Before promoting those steps, however, the president went after AIG, blaming its financial woes on executives' "recklessness and greed," and asking, "How do they justify this outrage to the taxpayers who are keeping the company afloat?"

It was unclear whether Obama thinks that the government has authority to take back AIG's bonuses, or instead is primarily seeking to position himself to keep in step with public outrage.

The Financial Products division that did the most damage to the company's standing was based in London. It sold billions of dollars worth of credit-default swaps, complex insurancelike financial instruments, which ultimately AIG couldn't fund.

AIG officials and administration officials, including Larry Summers, the head of the White House National Economic Council, previously indicated that the bonuses appeared to be protected by contract law, especially British law.

AIG is receiving about $170 billion in taxpayer assistance and is now about 80 percent taxpayer-owned. Federal officials moved to save it in September because they thought its failure would take down the global financial system since AIG insured the assets of so many major financial institutions.

"Under these circumstances, it's hard to understand how derivative traders at AIG warranted any bonuses, much less $165 million in extra pay," Obama said.

Obama said that given the taxpayer assistance AIG is receiving, he would asked Treasury Secretary Timothy Geithner "to use that leverage and pursue every single legal avenue to block these bonuses and make the American taxpayers whole. ... This is not just a matter of dollars and cents, it's about our fundamental values."

White House spokesman Robert Gibbs said that Obama inherited the contracts AIG signed last year under former President George W. Bush. "We can't change everything in the past. We will do all that we can."

Late Sunday night, AIG released the names of companies on the other end of its swap transactions. Its business partners were mainly major U.S. and foreign banks, adding to the public's rising sense of injustice over the bonuses, since taxpayers are now bailing out the banks both through the front door with government loans and the back door via support for AIG.

New York Attorney General Andrew Cuomo also turned up the political heat on AIG on Monday, demanding that it identify all employees receiving the bonuses, their job descriptions, performance records and copies of their work contracts. He issued subpoenas late Monday. In a letter to the company, Cuomo said he wants to determine if the bonuses amount to "fraudulent conveyances" under New York law, and that the contracts might be unenforceable because fraud was involved.

In his comments, Obama used his bully pulpit to push for corporate responsibility. He also was seeking, however, to separate himself from unpopular corporate excesses. A new Pew Center poll released Monday showed that Obama has begun to suffer declining public support because of the economic crisis.

"The president shares the public's outrage on this," Gibbs said.

Lawmakers on Capitol Hill sounded off, too.

"At a time when millions of Americans are losing their jobs and trying to make ends meet, it is outrageous that a company that has been bailed out by the taxpayers for its mistakes would turn around and pay its executives such a staggering sum of money," said Sen. Russ Feingold, D-Wis. Other lawmakers from both parties said much the same.

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Added House GOP Leader Rep. John Boehner of Ohio: "The latest revelation about AIG executives receiving millions in bonuses while taxpayers continue to bail out the company with hundreds of billions of dollars is outrageous and the clearest example yet of why an exit strategy is essential. The administration should pursue all means of recovering these bonus payments and present Congress _ and, more importantly, taxpayers _ an exit plan as soon as possible."

A House Financial Services subcommittee scheduled a Wednesday hearing on AIG.

(EDITORS: STORY CAN END HERE)

The AIG flap overshadowed Obama's announcement of help for small businesses, which was warmly welcomed. His latest economic rescue package will waive fees for small business loans, buy up to $15 billion in securities linked to loans guaranteed by the Small Business Administration, and require monthly reports from large banks and quarterly reports from other banks on small-business lending.

Thomas J. Donohue, the president and chief executive of the U.S. Chamber of Commerce, said that "small-business owners who are struggling to gain capital and stay afloat were offered a helping hand by the president today."

However, William Dunkelberg, the chief economist for the National Federation of Independent Business, the leading small-business trade group, said that only 3 percent of his members cite a lack of financing as a top problem, compared with 37 percent in the recession of the early 1980s. He said he didn't think access to finance was nearly as important as halting job losses and igniting a return of consumer confidence.

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(McClatchy Newspapers correspondents William Douglas, Greg Gordon and David Lightman contributed to this report.)

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ON THE WEB

More on the small-business plan: http://tinyurl.com/c9te46

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© 2009, McClatchy-Tribune Information Services.

Visit the McClatchy Washington Bureau on the World Wide Web at www.mcclatchydc.com.

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Smithtown DECA Garners Awards at State Championships

28 Students to Compete at National Championships


Smithtown High School East & West DECA (DECA – A National Marketing Association) completed its best ever results at the recent State Championship Conference in Rochester. Over half the students received recognition with four first in the state recognition. With their phenomenal performance, 28 students will represent Smithtown at the International Conference to be held in Anaheim, California beginning on April 29th.

When the buses left the school, the students and advisors, Cindy Wood and Phil Como – West and Christine LoFrese and Matt Hennings – East were optimistic about DECA’s chances at the State Competitions. The students worked with business people from the Industry Advisory Board, School of Business teachers and each other to prepare for this year’s State competition.

Four Smithtown East DECA students, Caitlin Ziegler, Ben Lynn, Chris Giamanco and Mike Porter were inducted into the New York State DECA Honor Society (photo below). Smithtown West DECA student, Dan Vrana, was the winner of the New York State DECA T-Shirt Contest.

The three day competition marked the best showing for the Smithtown DECA Chapters. In addition to the competitive medals, Smithtown DECA East & West were recognized for Chapter Enrollment Increase and Community Service Recognitions. Smithtown West DECA received recognition for the largest donation in the state for the 2009 New York State Charity – Autism Speaks. This charity was chosen by New York State DECA as the recipient of the state chapters’ fundraising efforts this year.

The three day competition engages students in many different business scenarios. Students engage in various competitions, ranging from written tests to role plays where students take on the part of a business owner, a vendor, or other business. Judges rate the participants on content, professional, presentation and business acumen. Some of the categories include Accounting, Business Law, Finance, Public Speaking, Sales Demo, Visual Advertising, Hospitality, Travel and Tourism, Food Marketing, General Marketing, Retail Merchandising and Sports Marketing. “The Smithtown School of Business department has always geared our students to real life situations. From our Industry Advisory Board, to innovative programs, we prepare our students for many different pathways. I am very proud of the work our students have done and I applaud the advisors for working so diligently with our students,” said Sherrion Elmore, Chairperson of the Career and Technical Education Department.

Smithtown DECA will be represented by 28 students at the International Career Conference in Anaheim. The students who attained this honor include – EAST : Brian Read, Taylor Zografakis, Patrick Kelly, Chris Giamanco, Tyler Kraese, Dan Maitles, Lyndsey Kaplan, Katherine Connor, Meagan Voulo, Lauren Thomassen, Taylor Hoffman, Caitlin Ziegler, Gabriella Sehne, Cristina Capone and Ryan Locks. WEST: Natasha Mitchko, Reena Glaser, Jacob Wirth, Andrew Jarrah, Joseph Arias, Bryan Kane, Tom Kirnbauer, Lauren Baruch, Connor Levens, Dan Vrana, Matt Thogersen, Ken Anthony-Scaturro and Steve Gardella (pictures below). The students will compete against the winner in other state competitions, and other international chapters.

Discovery heads to International Space Station

By Robert Block

The Orlando Sentinel

(MCT)

CAPE CANAVERAL, Fla. _ It was a long time coming, but space shuttle Discovery finally blasted its crew of seven into a cloudless Sunday evening sky _ the first orbiter flight of 2009 to the international space station.

Its mission: to provide more electricity to the orbiting lab.

A month behind schedule, the mission has been delayed four times by fragile valves inside the shuttle's propulsion system. Then a hydrogen gas leak scrubbed Discovery's first launch attempt last Wednesday.

But Sunday there were no signs of leaking gas, no hardware issues. Even Florida's fickle weather was perfect. The shuttle thundered into a clear sky, trailing a plume of pale vapor that turned bright pink as it caught the last light of the setting sun.

The launch was made possible by NASA engineers who worked overtime Thursday, Friday and Saturday to fix the leak, giving astronauts a near-full mission.

Delays did shorten the mission by a day to 13 days, and one of four spacewalks was dropped. That's because Discovery needs to leave the space station to make room for a Russian Soyuz spacecraft bringing new residents to the complex.

Discovery's crew, which includes two school teachers, should reach the international space station Tuesday. They are commanded by Air Force Col. Lee Archambault. The crew are pilot Dominic "Tony" Antonelli, a Naval Cmdr., mission specialists, Steve Swanson, a computer engineer, John Phillips, a Navy Reserve Capt., Koichi Wakata, a veteran Japanese astronaut, and Joseph Acaba and Richard Arnold II, both teachers and first-time fliers.

They're accompanying a 45-foot-long, 31,000-pound truss segment, the last U.S.-made piece of major hardware for the space station and the final section of station's "backbone" structure. Connected to the truss is the last set of solar wings to complete the space station's power system.

(EDITORS: BEGIN OPTIONAL TRIM)

Once it was clear the unexplained gas leak had been fixed, preparations for the launch were smooth, but colorful, not least because a fruit bat had attached itself on the shuttle's external tank before takeoff.

The bat clung to the backside of Discovery's tank, about a quarter to a third of the way from the bottom. Its presence forced NASA to run an "'engineering analysis" on the bat _ seriously _ just to makes sure that the small winged critter did not represent a threat to shuttle on launch.

NASA officials said they expected it to fly away on its own when the engines began to rumble to life. They even saw it as a good omen: the last time a bat was attached to a shuttle was on STS 72 in 1996 and both the bat and the shuttle flew off safely. Coincidentally that flight was the first for Wakata, who is now headed to station for a stint as Japan's first long duration astronaut.

But in a news conference later, Kennedy Space Center launch director Mike Leinbach suggested the bat did not survive its brush with Discovery. In response to a reporter's question, he said: "We are characterizing (the bat) as unexpected debris and he's probably still debris somewhere."

(END OPTIONAL TRIM)

The mission has been dubbed "Full Power" _ and that's what the astronauts hope to give the space station. Once Discovery reaches the station on Tuesday, the astronauts will start preparations to install the truss and solar panel.

The $300 million truss segment is the 11th piece of the station's backbone, which will measure the length of an American football field when complete. The truss segment is nearly identical to its counterpart on the port side of the station, but includes some modifications to hold spare parts and some sensors to measure wear and tear.

The two solar wings are made up of two sets of "blankets" which each hold 32,800 solar cells. They each span 115 feet in length and 38 feet across are now folded in boxes to a thickness of about 20 inches.

When unfurled in space like giant shower curtains, they will provide more power to help the station support larger crews of six and conduct more science research. The first six-person crews are scheduled to take up residency on the station in October this year.

(EDITORS: BEGIN OPTIONAL TRIM)

But the job of unfurling the solar panels is not easy. Previous sets of solar panels have had problems like sections of the solar panels getting snags as they opened out to their full length, or they got stuck together and refused to unfurl.

In the days waiting for Sunday's launch the astronauts who in charge of the installation watched videos of the spacewalkers studied videos of previous efforts to install solar electricity panels on the station.

"It's something we take seriously because these two solar electricity blankets we're going to deploy have been in the box, one for five years, and one for eight years," said astronaut Phillips who will be operating the space station's robotic arm to help spacewalkers Arnold and Swanson install the wings.

To make sure the wings open as planned the wings are stretched out slowly and allowed to warm in glow of the sun to loosen them up.

(END OPTIONAL TRIM)

In addition to getting the wings up and working, the mission's other objectives are to ferry a new part for the processor that turns urine into clean drinking water and to bring home U.S. astronaut Sandra Magnus after four months in space.

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© 2009, The Orlando Sentinel (Fla.).

Visit the Sentinel on the World Wide Web at http://www.orlandosentinel.com/.

Distributed by McClatchy-Tribune Information Services.

Fatal Motor Vehicle Crash in Port Jeff

PORT JEFFERSON (Suffolk County Police) - Suffolk County Police Sixth Squad detectives are investigating a motor vehicle crash which claimed the life of a 57 year old Port Jefferson man.

Justin Miller, 27, of 662 Route 25A, Port Jefferson was backing a 2004 Sterling dump truck into his driveway, on Sunday, March 15, 2009 at 7:15 p.m. Miller had a friend outside the truck directing him as he backed up. The friend saw a man behind the truck and screamed for Miller to stop. Miller did not hear his friend. The truck’s rear wheels ran over Frank Carroll, 57, of no known address.

Carroll was taken by Port Jefferson Village Ambulance to John T. Mather Memorial Hospital. He was pronounced dead a short time later.

Suffolk County Police Motor Carrier Safety units responded to the scene to perform a safety check. The investigation is continuing. Anyone who may have witnessed this crash is asked to call Sixth Squad detectives at 631-854-8652.

AIG plans bonuses to staff at unit that sent insurer to brink of collapse

By Marketwatch

MarketWatch

(MCT)

WASHINGTON _ American International Group is set to pay $450 million of bonuses to employees of the unit that was largely responsible for the New York insurer's near collapse last fall.

The decision to pay bonuses elicited howls of protest in Washington, which has prevented the failure of AIG by providing the insurer with more than $173 billion in aid. The federal government now owns 80 percent of AIG (AIG).

Larry Summers, one of President Barack Obama's top economic advisers, called the payments "outrageous," and a key House lawmaker, Barney Frank, D.-Mass., told Fox News the government should examine whether the bonuses are "legally recoverable."

Another Democrat, Rep. Elijah Cummings, D.-Md., renewed his call for AIG Chief Executive Edward Liddy to resign.

Liddy, in a letter to Treasury Secretary Timothy Geithner dated Saturday, said AIG had committed to paying the bonuses to employees of the financial-products unit and that they were "binding obligations" the company cannot legally rescind. The first payments are due March 15.

"I do not like these arrangements and find it distasteful and difficult to recommend to you that we must proceed with them," wrote Liddy, citing the recommendation from the insurer's legal counsel.

The payments to 400 employees of the financial-services unit _ some of whom no longer work at the insurer _ were promised last year before the federal government bailout. Bonuses range from as little as $1,000 to as much as $6.5 million.

Summers said the government would examine its options, but he acknowledged it might not be able to terminate prior bonus agreements.

"We are a country of law. There are contracts. The government cannot just abrogate contracts," he said in an interview Sunday on ABC's "This Week."

AIG is already scheduled to pay $121.5 million in incentive payments for 2008 to senior executives and 6,400 of its employees. And AIG is laying out another $619 million for 2009 in retention payments to more than 4,000 employees.

Total expected payments amount to almost $1.2 billion.

Regarding future incentive payments Liddy told Geithner the company cannot retain its best employees if their compensation is subject to "continued and arbitrary adjustment by the U.S. Treasury." If AIG loses its best employees, he indicated, it would make it harder for the company to recover and help the government recoup its investment.

Liddy also pointed out he won't receive a bonus and the company cut bonus payments for it senior executives. The top 25 executives in the financial-product unit, moreover, have agreed to accept a salary of just $1 for the rest of 2009, his letter said.

(EDITORS: STORY CAN END HERE)

AIG nearly collapsed under the weight of contracts that the financial-products units sold to protect other institutions against losses from securities backed by subprime mortgages.

Since so many financial firms around the world were insured by AIG, the failure of the firm could deal a devastating blow to the global financial system, Treasury and Federal Reserve officials say in justifying the most expensive bailout ever.

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© 2009, MarketWatch.com Inc.

Visit MarketWatch on the Web at http://www.marketwatch.com

Distributed by McClatchy-Tribune Information Services.

Obama expected to kill key Bush EPA program

By John Shiffman, John Sullivan and Tom Avril

The Philadelphia Inquirer

(MCT)

WASHINGTON _ The Obama administration intends to close an EPA program heavily promoted by the Bush Administration that rewards voluntary pollution controls by hundreds of corporations with reduced environmental inspections and less stringent regulation, according to EPA sources and internal emails.

EPA Administrator Lisa P. Jackson is expected to sign a memo terminating the Performance Track program, possibly as early as this week, senior EPA officials said Saturday.

Performance Track offers regulatory perks to corporations that pledge to save energy and reduce pollution. Entry into Performance Track, EPA's premier voluntary "Green Club," is supposed to be reserved for companies with sterling environmental records, but has been denounced by environmentalists as a public relations charade.

EPA's decision to close Performance Track comes three months after an Inquirer investigation found the program lauded companies with suspect environmental records, spent millions on recruiting and publicity and failed to independently confirm members' environmental pledges. The program became so desperate to find new members, The Inquirer found, that it turned to gift shops and post offices to pad its numbers.

A senior EPA official said Saturday in an interview the Inquirer's findings played a role in Jackson's decision.

The Inquirer's investigation of Performance Track came as part of a four-part series, published in December, on the Bush administration's subversion of the EPA, the federal agency charged with safeguarding human health and the environment.

(EDITORS: BEGIN OPTIONAL TRIM)

The Inquirer found the Bush administration's antiregulatory bent drove down funding, regulation and employee morale as senior political appointees censored the agency's own scientific findings in ways that consistently benefited corporations.

The series detailed how the Bush Administration circumvented Congress to rewrite air pollution rules to benefit business, and how a conservative-leaning court later declared a dozen of those rules illegal, invoking unusually caustic language. The Inquirer analysis also found that in nearly 50 pollution lawsuits filed in Washington, the EPA settled 80 percent of those brought by industry, compared to just 15 percent of those filed by environmental groups.

Inquirer reporters investigated plants across the country as part of its investigation of Performance Track.

Voluntary programs, such as Performance Track, and partnerships between EPA and corporations can work, said the senior EPA official, who was involved in the decision to kill the program.

But, the official added, "this one wasn't doing what it was created to do." Ultimately, the official said, Performance Track benefited business more than the environment.

Although the Performance Track program is small, it was symbolic because it represented a big part of Bush's environmental strategy. Top Bush officials promoted Performance Track to fight global warming by encouraging companies to reduce greenhouse gases, rather than forcing them to do so.

During the Bush years, the program doubled its corporate membership to 548 and increased its budget fourfold to $4.7 million.

Critics, however, said the program did little more than burnish green images for corporations.

"Performance Track is Exhibit A for why voluntary environmental programs will never be as effective as strong laws, faithfully enforced," said John Walke, clean air director for the Natural Resources Defense Council. "Performance Track now joins eight years of failed Bush administration voluntary global warming approaches as mistakes we must not repeat."

(END OPTIONAL TRIM)

EPA Press Secretary Adora Andy said a final decision to close Performance Track has not been made. But two other people involved said Jackson's signature is a mere formality and related meetings, including notification to companies and the 19 states participating in the program, could come as early as this week .

Late last week, Chuck Kent, an EPA supervisor in Washington, sent an e-mail to colleagues at the agency's regional headquarters, including in Philadelphia, about the program's termination on Thursday, according to a copy obtained by The Inquirer.

"Administrator Jackson has decided to halt the Performance Track program," Kent wrote. "We will be putting a banner across the Performance Track Web site notifying visitors of the program status and linking to the memos mentioned above as soon as the Administrator's memo is made public."

Late last year, EPA officials said, the Performance Track program employed 18 employees _ plus consultants. The employees are all career civil servants, and when the program is closed, they will be transferred to other EPA jobs, an official said.

(EDITORS: STORY CAN END HERE)

Performance Track was created in 2000, during the waning days of the Clinton administration. The Bush administration became an immediate champion after it caught the attention of a former American Plastics Council lobbyist who managed the administration's EPA transition team in 2001.

The Bush administration promoted Performance Track as a bold new approach that moved the EPA beyond its traditional role as enforcer of environmental laws, encouraging a philosophy in which EPA collaborated with industry to encourage cutting-edge environmentally sensitive practices.

Companies admitted to Performance Track pledge to promote "environmental stewardship" to local communities and must choose four environmental goals, such as energy or waste reduction.

Since 2001, Performance Track members have reported reducing greenhouse gas emissions by 310,000 tons and saving 3.7 billion gallons of water. The program's current 548 members range from Fortune 500 corporations to trailer parks.

(EDITORS: STORY CAN END HERE)

But, among The Inquirer's findings:

_The EPA has recruited companies with mixed _ even dismal _ environmental records to become Performance Track members.

_Despite offering members regulatory breaks and promoting the program as one that improves environmental performance, the EPA fails to independently verify that Performance Track companies actually reach their goals.

_Some Performance Track members have paid fines to settle EPA accusations they broke environmental rules. Since 2003, they have racked up more than 100 violations and paid $15.25 million in fines _ including $10.25 million paid by DuPont Co. for allegedly failing to provide information to the EPA about the health effects of a pollutant one of its plants spilled into drinking water.

_At least a dozen Performance Track members have actually increased the amount of toxic chemicals they pump into the air and water.

_As early as 2005, EPA enforcement officials discovered violations by Performance Track companies, and began to ask questions about compliance and corporate promises.

_EPA recruited into its "green club" a Charleston, Tenn. chlorine manufacturer despite the factory's rejection of a call to join most other manufacturers and abandon a 19th-century process that uses mercury.

(EDITORS: STORY CAN END HERE)

Neighbors near the Olin Corp. factory say it is the source of mercury pollution so severe that it prompted state warnings about eating fish in the local river.

One of the neighbors, Sherry Neidich, today applauded the decision to close Performance Track because, she said, it unfairly recognized Olin as an environmental leader.

"Companies like Olin haven't done anything," she said.

An Olin spokeswoman did not return a cell phone call today. The company has previously said its use of mercury is "always careful and controlled" and was recently significantly reduced.

The Performance Track program, which sponsors an annual May conference and award ceremony, has many fans among its corporate members.

Ken Ross, a spokesman for one local Performance Track member, the Lockheed Martin facility in Moorestown, Pa., said he was unaware of the plan to eliminate the program. He said Performance Track has had a positive effect on how the company addressed environmental issues, leading it to take such steps as using more recycled paper and converting several acres of the South Jersey site to a natural bird habitat.

"I think the bottom line is, it did a lot to get companies to think more about the environmental impact they have," Ross said. "That is part of our business culture at this point."

But Cary Coglianese, the associate dean of the Penn Law School and director of its program on regulation, said there is no evidence that Performance Track members are better environmental stewards than non-members.

"If Performance Track dies, the nation loses a major symbol of a new approach to environmental protection," Coglianese said. "But citizens need not linger long in mourning. Performance Track's members have no doubt done some good things for the environment, but it just can't be said they did all those good things because of Performance Track. In the program's absence, responsible companies will still continue to go beyond compliance and make environmental progress."

Besides, said Coglianese, who has closely studied Performance Track: "Ending the program is certainly one way to rid the agency of distraction at a time when it faces major battles over other issues like climate change."

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© 2009, The Philadelphia Inquirer.

Visit Philadelphia Online, the Inquirer's World Wide Web site, at http://www.philly.com/

Distributed by McClatchy-Tribune Information Services.

Cheney: Obama increasing nation's risk of terrorist attack

By Paul Richter

Chicago Tribune

(MCT)

WASHINGTON _ Former Vice President Dick Cheney said Sunday President Barack Obama has intensified the nation's risk of terrorist attacks by jettisoning key elements of the Bush administration's aggressive approach.

The criticism came in a broad-based attack on Obama during a Sunday news program in which Cheney also disagreed with expanded White House involvement in the economy, and denied former President George W. Bush was responsible for the nation's financial ills. The White House did not comment.

Cheney has sharply questioned Obama before, but the latest attempt comes amid a chorus of Republican criticism that nonetheless has had little effect on Obama's popularity or his success in Congress.

Cheney contended the key elements of the Bush administration's approach to terrorism were "absolutely essential" to what he described as its success in foiling subsequent attacks after Sept. 11. In particular, he said, it was crucial the nation treat the fight against terrorism as a war rather than a law enforcement issue.

Since entering office, Obama has announced plans to eventually close the Guantanamo Bay detention facility; banned waterboarding, an interrogation technique that makes a prisoner believe he is in imminent danger of drowning; said he would require CIA interrogators to abide by rules in the Army Field Manual; and ordered the closure of secret intelligence interrogation sites.

"Now he's made some choices that in my mind raise the risk to the American people of another attack," Cheney said on CNN's "State of the Union." Cheney said Obama is returning to the Clinton administration's approach of treating terrorism as a law enforcement matter rather than a "war." He warned that this would reduce the effectiveness of the U.S. response.

"They're very much giving up that center of attention and focus that's required," he said.

(EDITORS: STORY CAN END HERE)

In addition, Cheney criticized the new administration's approach to business regulation and said Obama's plans to reform healthcare, energy and the environment constituted "one of the greatest expansions of federal control over the private economy, probably in the history of the republic."

He said he worried the administration was using the economic crisis to justify an expansion of federal intervention.

Obama has said he generally favors limited government but he would take whatever steps are needed to ease the economic crisis.

Although he acknowledged the economy Obama inherited was "difficult," Cheney said the Bush administration did not deserve the blame Obama and other administration officials were directing its way. He called the downturn a "global problem" and argued the Bush administration's effort to deal with a key ingredient _ the disarray in the government institutions Fannie Mae and Freddie Mac _ was blocked by Democratic committee chairmen in Congress.

The accusation represents a frequent Republican explanation for the financial crisis, although economic experts have described the reasons as more numerous and complex than the problems at the government-backed mortgage firms.

Cheney said he was satisfied with Obama's plans to gradually withdraw U.S. combat troops from Iraq. He said Obama appeared to be heeding the advice of Army Gen. Raymond Odierno, the senior military commander in Iraq, and had "modified" the plans for a rapid drawdown that he had laid out in the campaign.

Cheney declined to describe his own confrontation with President Bush in the final days of the administration over Bush's unwillingness to pardon former Cheney chief of staff I. Lewis "Scooter" Libby. Libby was convicted of perjury and obstructing justice in the Valerie Plame-CIA leak investigation. Bush did, however, commute Libby's 30-month sentence before Libby served prison time.

But Cheney said he might reveal details in the memoir he plans to write about his decades in the government.

Asked whether right-wing talk radio host Rush Limbaugh is _ as conservative David Frum has described him _ "kryptonite" for the Republican Party, Cheney disagreed. "No, Rush is a good friend," he said. "I love him. I think he does great work and has for years." A succession of Republicans, including new national chairman Michael Steele, have criticized Limbaugh, then apologized amid a conservative backlash.

Limbaugh says he wants Obama to fail and has challenged him to a debate on his radio show.

"I'd pay to see that," Cheney said.

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© 2009, Chicago Tribune.

Visit the Chicago Tribune on the Internet at http://www.chicagotribune.com/

Distributed by McClatchy-Tribune Information Services.

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