U.S. Rep. Brad Miller harshly criticized the head of troubled insurer AIG today.

During testimony by American International Group Chairman Edward Liddy this afternoon, the Raleigh Democrat went after the company for using $49.5 billion of federal bailout money to pay off credit insurance policies held by banks.

In an exchange that was broadcast live on CNN, Miller said that the research on banking crises in other countries shows it is crucial to maintain "market discipline" by ensuring that businesses that made bad decisions suffer.

"Are we maintaining market discipline by continuing to give money to AIG to pay unsecured creditors?" he asked, brusquely.

Liddy responded that the company was no longer paying off its insurance policies, then added that the company had to honor its contracts.

"To your basic point, we owe those people that money," he said. "It's just a fact of life. ... The result of not paying them is an event of default, and it forces the (other) company into bankruptcy."

Previously: Miller criticizes Treasury Department.

Correction: An earlier version of this post included an incorrect link. 

U.S. Rep. Brad Miller is calling out President Obama.

In an interview with the liberal blog Talking Points Memo yesterday, the Raleigh Democrat said he's not convinced the new Treasury Department is much different than the old one.

"I want change I can believe in," he said. "I don't think we have change I can notice."

Miller, who has worked on banking issues since he was elected in 2002, said he does not think the department led by Treasury Secretary Tim Geithner has been responsive or transparent in its handling of bailed-out banks and financial insurer AIG.

"I don't feel a lot of confidence in all of this, because I don't have much idea what they're doing," he said, adding that he is a "fairly conscientious member" of the House Financial Services Committee.

He also charged that Goldman Sachs had "a lot of influence" over the AIG bailout. 

U.S. Sen. Kay Hagan is blasting bonuses at AIG.

The Greensboro Democrat said today in a statement that she shares "the public's outrage" over reports that the ailing financial insurer is paying employees $165 million in performance bonuses while receiving a federal bailout.

The company has defended itself by saying that they are contractually obligated to make the payments, a position the U.S. Treasury Department agreed with.

"I suppose it is no surprise that a company which engaged in such grossly reckless behavior that it required a $170 billion bailout would also willingly enter into a contract that requires it pay out 'performance bonuses' to its employees even when it is on the verge of bankruptcy," she said. "That is not good business sense."

Hagan cosponsored an amendment in February to limit the pay of CEOs of companies receiving federal bailout money.

Her statement followed similar remarks by President Obama Monday.

The Republican National Committee is criticizing Barack Obama for a Hollywood fundraiser.

In a mailer sent to North Carolina voters, the party notes that the Democratic presidential candidate attended a fundraiser with Hollywood actors while Congress was deciding to seize control of insurance company AIG.

"With Wall Street in crisis, Obama parties with Hollywood's elite," it says, next to pictures of Obama, Leonardo DiCaprio and Barbra Streisand.

It quotes a Sept. 21 story in the Washington Post that says that Obama spent 20 minutes meeting with his economic advisors before attending a three-hour, $28,500 a plate fundraiser.

"The Democratic presidential nominee had 20 minutes before he arrived, he told his economic policy coordinator, and he wanted to spend it receiving input from his new economic brain trust," the story noted.

The party has also made a robocall to North Carolina voters about the fundraiser.

U.S. Sen. Elizabeth Dole didn't skip a subcommittee hearing on banking.

She wasn't invited. The reason? She doesn't sit on the subcommittee.

In an e-mail blast to supporters and journalists earlier today, Democratic Senate candidate Kay Hagan's campaign attacked Dole for not asking any questions at a Sept. 18 hearing on the AIG bailout and the bankrupty of Lehman Brothers.

"Dole failed to ask any questions or make any remarks at the hearing on September 18," the e-mail said.

The hearing, however, was of the Subcommittee on Securities, Insurance and Investment. Dole sits on the overall Senate Committee on Banking, Housing and Urban Affairs and three other subcommittees.

Hagan spokeswoman Colleen Flanagan dismissed the mistake, saying that Dole has missed "over 60 other Banking committee hearings" in the Senate.

Update: Dole spokesman Daniel McLagan criticized that response.

"So Kay Hagan tells a lie, gets caught in it, and rather than apologizing, dismisses it and attacks again," he wrote Dome. "Wow, she's a class act." 

A group of North Carolina supporters of John McCain argued today that his policies would help with the current problems in the financial industry.

On a conference call with reporters this morning, the Republican presidential candidate's senior policy advisor, Nancy Pfotenhauer, UNC-Wilmington professor J. Edward Graham and Charlotte businessman Mark Erwin said a combination of lower taxes, reduced spending and more free trade would help the economy recover.

Pfotenhauer attacked Democrat Barack Obama for not offering more specifics in his proposals for handling recent problems with Freddie Mac, Fannie Mae and AIG. She said he offered only "rhetorical pablum."

"It's like saying you're for puppies, kittens and sunshine," she said.

Erwin, a former supporter of Hillary Clinton who endorsed McCain in August, said Obama's plan for a tax hike on the highest income earners and a middle class tax cut would hurt the economy, since it would hurt taxpayers who are "creating the jobs and generating the wealth."

"As I try to understand Senator Obama's economic plan, it seems to be designed for those people who failed math in school," he said.

More after the jump.

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