Obama administration will try to block questionable AIG bonuses

The New York Times reports that:

President Obama vowed to try to stop the faltering insurance giant American International Group from paying out hundreds of millions of dollars in bonuses to executives, as the administration scrambled to avert a populist backlash against banks and Wall Street that could complicate Mr. Obama's economic recovery agenda.

Lest we forget, the federal government now owns about eighty percent of AIG. But will this fact matter? How could have this situation come about in the first place? After all, as Glenn Greenwald makes clear:

The only way a company like AIG throws up its hands from the start and announces that there is simply nothing to be done is if they are eager to make these payments. One might expect AIG to do so — they haven't exactly proven themselves to be paragons of business ethics — but the fact that Obama officials are also insisting that nothing can be done (even while symbolically and pointlessly pretending to join in the populist outrage over these publicly-funded "retention payments") is what is most notable here.

More pointedly, as the Razor's Edge wonders: "How did the AIG executives expect to sneak this by the media and angry taxpayers?" Can the AIG people be that clueless? Or did they expect the Obama administration to provide the political coverage they needed to further loot this company?