Obama Criticizes Wall Street Bonuses, Promises Financial Reforms

By Michael Bowman

WASHINGTON (RushPRnews) 01/30/09-President Barack Obama has blasted hefty bonuses paid to U.S. financial executives at a time when American taxpayers have spent hundreds of billions of dollars to keep banks and Wall Street firms afloat. Mr. Obama spoke Thursday on continuing efforts to revive the troubled U.S. economy.

One day after the House of Representatives passed President Obama’s economic recovery plan, the president was eager to speak about his administration’s efforts to right America’s economic ship.

After a meeting with his economic team, Mr. Obama saved his most pointed remarks for financial firm executives. The president pointed to a report that found top managers collected more than $18 billion in bonuses last year.

“That is the height of irresponsibility,” he said. “It is shameful.”

His irritation clearly evident, Mr. Obama noted that taxpayers have bailed out numerous failing financial institutions in recent months. He did not seem to be mollified by that fact that the report – issued by the New York State Comptroller – said bonuses actually were down 44 percent from the previous year.

“The American people understand that we have a big hole that we have to dig ourselves out of,” he said. “But they do not like the idea that people [financial firm executives] are digging a bigger hole, even as they are being asked to fill it up.”

The president promised his administration would take up the matter with Wall Street executives and stress the need for responsible corporate behavior.

Mr. Obama said that reforming the way America does business will be a key component of a multi-pronged approach to revive the U.S. economy. He said his administration is crafting badly-needed financial reforms and other measures that will be unveiled in coming weeks.

“The American people will have a clear sense of a comprehensive strategy designed to put people back to work, reopen businesses, and get credit flowing again,” said President Obama.

The first element of the president’s economic program cleared a major legislative hurdle this week with the House of Representatives passing an $819 billion economic recovery plan. The package, which combines tax cuts with new spending on multiple fronts, now goes to the Senate for consideration.

But the bill failed to receive a single House Republican vote, despite a concerted effort by the president to lobby opposition legislators.

White House Press Secretary Robert Gibbs expressed no bitterness about the Democratic-Republican party-line vote.

“Old habits die hard in this town,” he said. “We get [understand] that. But the president understands that changing the way Washington works is not likely to happen in just 10 days.”

Republicans strongly criticized the recovery package, saying it contains insufficient tax cuts for wage earners and that it is laden with wasteful government spending.

Gibbs said the plan is designed to quickly inject money into the economy to spur job creation and growth. He said the package is desperately needed, as economic indicators continue to paint a bleak picture.

On Thursday, the U.S. Labor Department reported that the number of Americans receiving unemployment benefits has spiked to a record 4.78 million people. That is the highest figure since the department began tracking jobless data in the 1960s. U.S. unemployment has risen more than two percentage points during the last year, mirroring trends around the world.

U.S. gross domestic product numbers for the fourth quarter of last year are should be released on Friday. Most analysts warn that the figures will show a major economic contraction that began more than a year ago.