January 29th, 2009
04:32 PM ET
11 months ago

Obama blasts bonuses for struggling Wall Street

President Obama rebuked Wall Street Thursday during a meeting with new Treasury Secretary Timothy Geithner.
President Obama rebuked Wall Street Thursday during a meeting with new Treasury Secretary Timothy Geithner.

WASHINGTON (CNN) - President Barack Obama called the prospect that some of the $700 billion Wall Street bailout could end up paying for bonuses to managers of struggling financial institutions "shameful" Thursday.

Watch: Pres. Obama takes Wall St. to task

New York's state comptroller raised that prospect in a Wednesday report that found the bonus pool for the financial industry is still the sixth-biggest on record despite a 44 percent decline from 2007. Speaking after a meeting with his top economic advisers, Obama said it was the "height of irresponsibility" for executives to pay bonuses when their companies are asking for help from Washington.

"The American people understand we've got a big hole that we've got to dig ourselves out of, but they don't like the idea that people are digging a bigger hole even as they're being asked to fill it up," he said.

"There will be time for them to make profits, and there will be time for them to get bonuses. Now is not that time," Obama added.

The president's latest concerns come two days after struggling banking giant Citigroup - which has taken about $45 billion from the government's Troubled Asset Relief Program - reversed plans to accept delivery of a new $42 million corporate jet under Treasury Department prodding.

"We shouldn't have to do that, because they should know better - and we will continue to send that message loud and clear," Obama said.

The bailout program restricted bonuses for top executives of firms that received federal funds. But New York Comptroller Thomas DiNapoli's report Wednesday noted that the program does not limit bonuses for lower-level staff.

"There needs to be greater transparency and accountability in the use of these funds," DiNapoli said in a statement accompanying his report. "Every dime counts, especially when they're taxpayer dimes, and taxpayers ought to know if
these funds were used to buy corporate jets, pay dividends or bonuses."

White House spokesman Robert Gibbs said the president had a one-word response to DiNapoli's report: "Outrageous." Asked whether the administration
could take any action to head off those bonuses, Gibbs said, "That's what we're
looking into, and that's what we're working on recommendations for."

Obama's remarks came after a meeting with Vice President Joe Biden, Treasury Secretary Tim Geithner and other members of his economic team.


Filed under: Economy • President Obama • Tim Geithner
soundoff (120 Responses)
  1. Katy

    I want my wall street & bank bail out money back. I lost my hard earned 401K & saving and potenital unemployment.. they have my $$ and pay for bonuses? Is this demoncratic country or country for the wealthy and king & queen to suck all resources e.g. blood & money from common people like me.

    I want President Obama (please don't be brainwashed once you corss the common person to president) to investigate and give $ back to people like me.

    January 29, 2009 04:49 pm at 4:49 pm |
  2. Ryan

    President Obama is awesome – he basically lashed out at all the people who lobbied the Bush Administration and former-GOP heavy Congress and screwed up the economy.

    All the anti-Obama people keep calling him a socialist and they don't even know what it means. Socialism is better than Fascism which is what it was under the Bush admin. Well.. perhaps not.. perhaps that was more socialism since they did spread the poverty around.

    As for the Republicans who didn't support the bill: Then don't accept any bailout money for the districts you represent. Do not help your voters find jobs and don't cry to us later when you aren't re-elected.

    Also – You really thought tax cuts were a better idea? Tax cuts are useless when millions of Americans have NO JOBS TO TAX ON IN THE FIRST PLACE!!

    You don't support infrastructure?? Those highways don't maintain themselves.. or do we need another MN type bridge collapse to convince you?

    January 29, 2009 04:50 pm at 4:50 pm |
  3. Sean from Virginia

    This is amazing. The president criticizes Wall Street spending while his "stimulus" bill is doing the very same thing, on top of a bailout that hasn't worked. And when is it the role of government to dictate how Wall Street does things? Sounds like Socialism 101 to me.

    January 29, 2009 04:51 pm at 4:51 pm |
  4. Ruth Reynolds

    We must insist on complete transparency for the bail out money. It should involve NO bonuses. Government could insist on that.

    January 29, 2009 04:51 pm at 4:51 pm |
  5. Ghost

    Go get 'em. Mr. President!!!!!!!

    January 29, 2009 04:51 pm at 4:51 pm |
  6. worriedmom

    Correct me if I am wrong, but didn't he vote Yes for the first Bail out. Come on, let stop saying what you think people want to hear, I would rather hear I made a mistake and I cannot do everything instead of trying to please all sides. The person that tries to please everyone, ends up pleasing no one.

    January 29, 2009 04:52 pm at 4:52 pm |
  7. Blue VA

    Thank you Mr. President for making that clear to those greedy SOB's on Wall St.

    January 29, 2009 04:52 pm at 4:52 pm |
  8. People make no sense

    Yes Republican trickle down affect at its finest.

    January 29, 2009 04:53 pm at 4:53 pm |
  9. Bill P

    You gave the money without oversight of what was to be done with it. You have no one to blame but yourself!

    January 29, 2009 04:53 pm at 4:53 pm |
  10. Tariq

    The greed here is sickening. That bail-out money was not meant for bonuses, much less for bonuses given to the same idiots who drove companies to the ground and millions of honest workers to unemployment.

    What bothers me the most is...why are the companies willing to pay to hang on to greedy executives and idiot top-level employees? The greedy idiots have no bargaining chip. If they threaten with quitting, it will require a lot more than luck to find a company that will hire them with their repuation!

    January 29, 2009 04:54 pm at 4:54 pm |
  11. tired of corporate politics

    All for show.

    Obama is not going to do anything after taking Big Money from these corporations. It is easy to look up the long list of banks and Wall st. companies that gave him Big Money.

    What he WILL do is fork over more money to them. That is called payback.

    Think about it. He didn't call it "lobby" money but it was sure the same color green. And it buys the same thing.

    January 29, 2009 04:55 pm at 4:55 pm |
  12. Sherry

    Everyone still wondering what happened to our $$ besides the Madoffs of the world taking off with it? Where is the money? Sitting in the banks and investment firms waiting for more to be given to them. For bonus pay-outs, weekly, monthly and yearly. This strinks. No one in this country needs a bonus until we are on our feet and obviously some still need to be knocked off their feet.

    January 29, 2009 04:55 pm at 4:55 pm |
  13. S Callahan

    I am not against bonuses...I'm against exagerated bonuses......and that is what has been happening over the last ten or so years.....
    It really is time to tighten the belt...as difficult as it may be.

    January 29, 2009 04:56 pm at 4:56 pm |
  14. rena

    That's what I'm talking about. Shut these greed mongers down!

    January 29, 2009 04:56 pm at 4:56 pm |
  15. Marie banderas

    the New York comptroller said that does not stop lower level staff from recieving bonus's, well, thats simple, just demote the higher paid staff to lower position, then give them the bonus you was going to give them anyways..LOL..we are still going to get another screwing by wall street and big buisness any which way we go...now, thats something you can believe in !
    when I "see" our, ( or any of my friends or familys) get bonus's or even jobs bACK, or raises, I might start believing then...
    none of those people ever have to wqorry about seeing the best of Dr's either ! wheres OUR medical help ???????

    January 29, 2009 04:56 pm at 4:56 pm |
  16. Louis

    Why didn't these geniuses write a provision in the bailout to prevent bonuses for low-level staff of firms that received federal funds?Because they are actually morons. The money of the American people is once again stolen by the government for incompetent policy.

    January 29, 2009 04:57 pm at 4:57 pm |
  17. Nadroj Namor

    Will these people ever stopbeing so greedy and learn.....

    January 29, 2009 04:57 pm at 4:57 pm |
  18. Cammi317

    You tell them Mr. President.

    January 29, 2009 04:58 pm at 4:58 pm |
  19. Mark, B'ham., Al.

    The Obama's must have got a big bonus somewhere going from $1.6 mllion one year to over $4 million the next year according to their taxes.

    January 29, 2009 04:59 pm at 4:59 pm |
  20. Kenneth

    How can someone justify big bonuses when their company is receiving a bailout? yeah its tough and they are looking out for their employees right? But at the expense of my tax dollars ... i don't think so! I'm struggling just as much as the next man so I do empathize but the cap should be on for any company that receives a bailout. NO bonuses, NO jets, and the only thing my tax dollars should be spent on is the betterment of all society not the chosen few head honchos from a greedy corporation. GM got bailed out and my 2005 Yukon's bearings crapped out at a cost of $1200 to repair. Are they willing to work with me? Nope they just want their money on time. Well the tables are turning and all of these "big" corporations that need our help and even though we don't have much choice at this stage of the game they should at least show some dignity and "try" to do the right thing.

    I don't want a bailout ... I just want companies to stop pulling my legs out from under me!

    January 29, 2009 04:59 pm at 4:59 pm |
  21. GWC

    Not only do we need to stop future abuse of spending, we should find a way to GET SOME OF OUR MONEY BACK from those who have abused the bailout funding.

    January 29, 2009 05:00 pm at 5:00 pm |
  22. RICHARD CALHOUN

    DID THE GOVERNMENT NOT SPECIFY WHAT THE TAXPAYER'S MONEY CAN BE USED FOR??????????/
    WALL STREET IS VERY IRRESPONSIBLE, BUT MAYBE THE GOVERNMENT IS EVEN MORESO. SINCE NO STRINGS WERE ATTACHED TO HOW THE MONEY CAN BE SPENT.

    January 29, 2009 05:00 pm at 5:00 pm |
  23. Vicky from Milwaukee

    Thanks President Obama! At the very least it's time they finally heard somebody important call them on their greed, selfishness, and bad behavior.

    January 29, 2009 05:01 pm at 5:01 pm |
  24. Ron Ft. Myers

    I would like to know where our so called "leaders" were and what they were thinking when they "gave" away all this money with no strings attached?

    Where was Pelosi and Barney "Rubble" Frank? Typical washington BS. There is not one of these clowns that ever had a job, they are parasites of the system and we are expecting these same clowns to turn the economy around? They're too busy worrying about prosecutors that were dismissed by the Republicans opposed to watching the spending of our billions of dollars.

    It reminds me of the Serpico story, wherein when asked about the system is said something like "it is too corrupt." They may not be corrupt, but they are definitely over their heads when it comes to business.

    Send these idiots back to the barn!

    January 29, 2009 05:01 pm at 5:01 pm |
  25. ericc39

    First "that one" will go after the easy target of wall street. Then it will be the managers and white collar workers, finally it will be every working American. Remember the goal here is socialism. and the total redistribution of you hard work and earnings to the benefit of those that do not. He will take the earnings of hard working individuals and to give it away in entitlements. Remember the words of his friend Ayres who said "....after the revolution we just have to get rid of 25 million non-conformist." Sounds a lot like a certain politician from the 1930's in Germany who had a cult like following. Who is John Galt????

    January 29, 2009 05:02 pm at 5:02 pm |
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