Discussing the March 19 House vote to levy a 90-percent tax on executive bonuses paid to companies owing more than $5 billion in loans to the government, NBC, ABC, and Fox News all advanced the false Republican accusation that by passing the American Recovery and Reinvestment Act, Democrats created the right for AIG to pay bonuses. In fact, as Media Matters for America documented, the recovery bill did not create the right for AIG -- or any company -- to pay bonuses. Rather, AIG reportedly disclosed that it had entered into agreements to pay these bonuses more than a year ago, the Bush Treasury department approved of the AIG bailout with this agreement in place, and the relevant provision in the recovery act, which was based on an amendment by Sen. Chris Dodd (D-CT), actually restricted the ability of companies receiving money from the Troubled Asset Relief Program (TARP) to award bonuses in the future.

In the absence of the recovery bill, AIG's ability to pay the bonuses would not have been limited. Indeed, if Republicans had succeeded in defeating the bill, the clause restricting the ability of troubled companies to award bonuses in the future would not have been enacted at the time.

Media reports advancing the falsehood include:

• During the March 19 edition of NBC's Nightly News, Capitol Hill correspondent Kelly O'Donnell asserted that "[l]awmakers [are] under fire because the stimulus package that the White House wanted -- and Congress passed with only three Republican votes -- actually permitted scheduled bonus payouts. But, today, both Democrats and Republicans voted for a fix." O'Donnell later claimed that there is a “clamor to identify some unnamed official who pushed forward a change in the original stimulus bill that allowed AIG bonuses.”

• During the March 19 edition of ABC's World News, senior congressional correspondent Jon Karl claimed that “on Capitol Hill today, the angriest voices were Republicans, who say blame for the bonuses lies with Democrats,” and that "[a]t issue" is “a tiny provision added into last month's stimulus bill that exempts employee contracts signed last year from new limits on pay.”

• During the March 19 edition of Fox News' Special Report, chief political correspondent Carl Cameron asserted, “Six Democrats and 87 Republicans opposed the measure as too rushed, potentially unconstitutional, and a Democratic attempt to close a bonus loophole that they created in the stimulus package.” He later claimed, “Republicans called the bill a diversion from Democratic Senator Chris Dodd's admission that Treasury officials pushed him to insert language into the recent stimulus package allowing bailout recipients to pay huge bonuses.”

• During the March 19 edition of Fox News' Hannity, host Sean Hannity asserted, “Now, remember all the outrage earlier this week from Democrats over AIG bonuses? Now the very same bonuses that they voted for in the massive stimulus bill -- you know, the one that they never read, and the one that they, in a panic, voted to take away earlier today. Well, it all came to a head, and the guilty parties finally now come forward,” repeating a false claim he made during the March 19 broadcast of his radio show that Democrats “voted for” the bonuses.

From the March 19 edition of NBC's Nightly News with Brian Williams:

O'DONNELL: Lawmakers under fire because the stimulus package that the White House wanted -- and Congress passed with only three Republican votes -- actually permitted scheduled bonus payouts. But, today, both Democrats and Republicans voted for a fix: a 90-percent income tax on the bonus money if the company received more than $5 billion in government bailout funds. Part of the day was full of bluster.

SEN. JOHN KYL (R-AZ): Help us find out who that was.

O'DONNELL: A clamor to identify some unnamed official who pushed forward a change in the original stimulus bill that allowed AIG bonuses. Senator Chris Dodd had been behind an effort to limit executive pay and says it was the administration that thought the limits went too far.

DODD: They came and said, look, we'd like to make some modifications.

O'DONNELL: Treasury officials say department staffers did advise Dodd that part of his proposal would not hold up because of existing employment contracts at the bailed-out firms.

From the March 19 edition of ABC's World News with Charles Gibson:

KARL: But on Capitol Hill today, the angriest voices were Republicans, who say blame for the bonuses lies with Democrats.

HOUSE MINORITY LEADER JOHN BOEHNER (R-OH): This bill is nothing more than an attempt for everybody to cover their butt up here on Capitol Hill.

REP. MICHELE BACHMANN (R-MN): This is a scandal that's brewing in Washington. We need to have answers.

KARL: At issue: a tiny provision added into last month's stimulus bill that exempts employee contracts signed last year from new limits on pay. It's the loophole that made the AIG bonuses possible.

REP. BARNEY FRANK (D-MA): The answer is: I was not involved.

DODD: I wasn't in the room.

HOUSE SPEAKER NANCY PELOSI (D-CA): If you want to talk about what happened on the Senate, go on the Senate side and talk to them.

KARL: But late today, Treasury Secretary Timothy Geithner, in an interview on CNN, admitted that it was Treasury Department officials who pushed for the loopholes, because they feared a wave of lawsuits if bonus contracts were broken.

From the March 19 edition of Fox News' Special Report with Bret Baier:

CAMERON: Six Democrats and 87 Republicans opposed the measure as too rushed, potentially unconstitutional, and a Democratic attempt to close a bonus loophole that they created in the stimulus package.

REP. MIKE PENCE (R-IN): The Democrats in Congress and this administration made these bonus payments possible.

REP. JEB HENSARLING (R-TX): What we have today here is nothing short of a legislative cover-up.

CAMERON: Republicans called the bill a diversion from Democratic Senator Chris Dodd's admission that Treasury officials pushed him to insert language into the recent stimulus package allowing bailout recipients to pay huge bonuses. The GOP also noted Democratic Senator Ron Wyden's [OR] assertion that Treasury Secretary Tim Geithner and other administration officials demanded removal of Wyden's amendment with the Republican Olympia Snowe [ME] to tax offensive bonuses in the first place.

From the March 19 edition of Fox News' Hannity:

HANNITY: That is our headline this Thursday night, day number 59 of the Obama presidency -- that's “Blatant Dishonesty.” Now, remember all the outrage earlier this week from Democrats over AIG bonuses? Now the very same bonuses that they voted for in the massive stimulus bill -- you know, the one that they never read, and the one that they, in a panic, voted to take away earlier today. Well, it all came to a head, and the guilty parties finally now come forward.