January 16th, 2010
08:00 AM ET
8 years ago

Obama: We won't let Wall Street 'take the money and run'

Full text of President Obama's weekly address, as released by the White House:

Remarks of President Barack Obama
As Prepared for Delivery
Weekly Address
January 16, 2010

Over the past two years, more than seven million Americans have lost their jobs. Countless businesses have been forced to shut their doors. Few families have escaped the pain of this terrible recession. Rarely does a day go by that I do not hear from folks who are hurting. That is why we have pushed so hard to rebuild this economy.

But even as we work tirelessly to dig our way out of this hole, it is important that we address what led us into such a deep mess in the first place. Much of the turmoil of this recession was caused by the irresponsibility of banks and financial institutions on Wall Street. These financial firms took huge, reckless risks in pursuit of short-term profits and soaring bonuses. They gambled with borrowed money, without enough oversight or regard for the consequences. And when they lost, they lost big. Little more than a year ago, many of the largest and oldest financial firms in the world teetered on the brink of collapse, overwhelmed by the consequences of their irresponsible decisions. This financial crisis nearly pulled the entire economy into a second Great Depression.

As a result, the American people – struggling in their own right – were placed in a deeply unfair and unsatisfying position. Even though these financial firms were largely facing a crisis of their own creation, their failure could have led to an even greater calamity for the country. That is why the previous administration started a program – the Troubled Asset Relief Program, or TARP – to provide these financial institutions with funds to survive the turmoil they helped unleash. It was a distasteful but necessary thing to do.

Many originally feared that most of the $700 billion in TARP money would be lost. But when my administration came into office, we put in place rigorous rules for accountability and transparency, which cut the cost of the bailout dramatically. We have now recovered most of the money we provided to the banks. That’s good news, but as far as I’m concerned, it’s not good enough. We want the taxpayers’ money back, and we’re going to collect every dime.

That is why, this week, I proposed a new fee on major financial firms to compensate the American people for the extraordinary assistance they provided to the financial industry. And the fee would be in place until the American taxpayer is made whole. Only the largest financial firms with more than $50 billion in assets will be affected, not community banks. And the bigger the firm – and the more debt it holds – the larger the fee. Because we are not only going to recover our money and help close our deficits; we are going to attack some of the banking practices that led to the crisis.

That’s important. The fact is, financial firms play an essential role in our economy. They provide capital and credit to families purchasing homes, students attending college, businesses looking to start up or expand. This is critical to our recovery. That is why our goal with this fee – and with the common-sense financial reforms we seek – is not to punish the financial industry. Our goal is to prevent the abuse and excess that nearly led to its collapse. Our goal is to promote fair dealings while punishing those who game the system; to encourage sustained growth while discouraging the speculative bubbles that inevitably burst. Ultimately, that is in the shared interest of the financial industry and the American people.

Of course, I would like the banks to embrace this sense of mutual responsibility. So far, though, they have ferociously fought financial reform. The industry has even joined forces with the opposition party to launch a massive lobbying campaign against common-sense rules to protect consumers and prevent another crisis.

Now, like clockwork, the banks and politicians who curry their favor are already trying to stop this fee from going into effect. The very same firms reaping billions of dollars in profits, and reportedly handing out more money in bonuses and compensation than ever before in history, are now pleading poverty. It’s a sight to see.

Those who oppose this fee say the banks can’t afford to pay back the American people without passing on the costs to their shareholders and customers. But that’s hard to believe when there are reports that Wall Street is going to hand out more money in bonuses and compensation just this year than the cost of this fee over the next ten years. If the big financial firms can afford massive bonuses, they can afford to pay back the American people.

Those who oppose this fee have also had the audacity to suggest that it is somehow unfair. That because these firms have already returned what they borrowed directly, their obligation is fulfilled. But this willfully ignores the fact that the entire industry benefited not only from the bailout, but from the assistance extended to AIG and homeowners, and from the many unprecedented emergency actions taken by the Federal Reserve, the FDIC, and others to prevent a financial collapse. And it ignores a far greater unfairness: sticking the American taxpayer with the bill.

That is unacceptable to me, and to the American people. We’re not going to let Wall Street take the money and run. We’re going to pass this fee into law. And I’m going to continue to work with Congress on common-sense financial reforms to protect people and the economy from the kind of costly and painful crisis we’ve just been through. Because after a very tough two years, after a crisis that has caused so much havoc, if there is one lesson that we can learn, it’s this: we cannot return to business as usual.

Thank you very much.

Filed under: President Obama
soundoff (58 Responses)
  1. Rick in WPB,FL

    Mr. President,
    Sir, I applaud your actions; for taking this huge mess upon your shoulders and seeing this country through this most difficult time. I would sincerely appreciate knowing, as I'm sure are most Americans, who the financial firms are that are fighting against these reforms. We as a country need to withhold our business from them and let them feel what we've been going through. It is a shame what they have caused. May God bless you and your beatiful family and give you continued Grace; and may he bring his wrath on those who would put "profit before country".

    January 16, 2010 09:56 am at 9:56 am |
  2. joe m

    can we apply the same standard to senators and representatives? heck, some of them haven't yet pain taxes on earnings from previous years. i find the amounts of compensation, especially for the highest earners, obscene as well, but i'm not exactly sure how taxing the banks will really help. the message being sent is not that we will hold banks and their executives to a higher standard, but rather we can't control them so instead we will hit them with this big stick instead. i'd like to see more done along the lines of putting into place regulations on how these banks can serve americans better, rather than simply blaming them. its easy to assign blame to the biggest target, in this case the banks, but there are others responsible, many of whom are our own political leaders. the president's approach is more of the same old politics, pithing the 'haves' against the 'have-nots'.

    January 16, 2010 09:58 am at 9:58 am |
  3. jp,michigan

    HOW CAN oBAMA SPEAK ABOUT TRANSPARENCY AND ACCOUNTABILITY, WITH A STRAIGHT FACE? Look at the secretive debates about health-care, the subject that affects every American citizen. Government, state and federal employees, as well as Union members get a tax break for 4-5 years, while the rest of us piack up the cost. Hey, President! Is there a union for senior citizens. As a retired nurse, I have paid and paid for the uninsured and now I pay for my medicare part B and medicare advantage , plus I wil be picking up the tax too. Thank you? Now everyone can understand why many democrats have changed to independents, for neither party can be trusted!

    January 16, 2010 09:59 am at 9:59 am |
  4. shmeckell

    The banks lived to their end of the deal. The government forced banks to provide everyone with a loan for a house (Fannie/Freddie), but don’t worry about foreclosures because AIG will back those mortgages.

    AIG sold insurance policies, but the government never classified them as an insurance company, and never required them to keep any assets on hand to pay out claims; like every other insurance company in this country is required to do. AIG sold nothing just like Bernie Madoff, but instead of jail time they got billions in bailout money; and to top it off Mr. Obama, you want the banks (who paid their debts back) to repay AIG's bailout money that they received for being the biggest scam this country has ever seen.

    If the banks pay it back they will filter it down to the middle class by raising rates and fees, and once again you can make the banks look like the bad guys, but all along the bad guys are the people in our government that wrote the laws to make this possible.

    Politicians go to school to learn how to manipulate laws; they have no more knowledge about the economy than you or I. Most of them never ran a company and have no idea what is involved, but they seem to make decisions to manipulate the economy and the private sector based on what they learned in law school.

    The private sector needs to be regulated, but you people regulate them into failure, you base your decisions on speculative unproven philosophy, and rarely seek the advice of professionals. Now, shortly after you all but destroyed the economy you have focused your attention on the healthcare industry; another industry you have put all the wrong regulations in all the right places. You have screwed it up so bad, you now admit defeat and want to take it over. If you want socialized medicine first you must do something with the current antitrust laws, don’t make a deal with the pharmaceutical companies, and let the companies compete nationwide just like every other industry in the country (including insurance). Only then will we see the true market value of health insurance, and be in a much better position to socialize it. I guess that does not work for you because then there would be no need to do such a thing.

    January 16, 2010 10:03 am at 10:03 am |
  5. SF

    Didn't the government buy preferred stock in most of the wall street firms, and have then been paid back. Including the warrants. The tax payers will lose money on the auto companies and AIG. And if they made deals buying ownership in any firm what gives them to punish those firms. I wish I could get my money back on every bad investment.

    January 16, 2010 10:03 am at 10:03 am |
  6. Johnny DC

    Why does this administration refuse to see how capitalism works? You can't simply reduce bonuses and paychecks of the biggest executives to zero, or those big, successful, experienced executives will leave the largest banks and go to prop up other banks.

    Perhaps the crazed inexperience leadership is what this administration loves to see (I wonder why), but in free market systems this is not the answer. Not to mention the banks will simply shift the fee burden onto its customers with great ease.

    It happens in the oil industry, it happens in the banking industry, it happens everywhere. If you tax the leaders, they will shift the burden.

    Obama, like always, is trying to rally the middle class in support of him with hate speeches against the rich. Typical Washington from a guy who promised the extraordinary.

    January 16, 2010 10:06 am at 10:06 am |
  7. Hasai

    Just revamp the Glass–Steagall Act and get it back on the books. Seems to me that things were motoring along just fine, until Foggy Bottom started undermining the Act.

    January 16, 2010 10:07 am at 10:07 am |
  8. buckwheat

    Wall street took its money and ran when ,before the election, they saw Barack Hussien Obama gaining strength.Anyone with a grain of brains new what was about to happen.There is as much money out there as there ever was and it will stay there till this man and his crooks are out of office. The stock market in itself is a legal ponzi scheme to start with. The Kennedys got rich during the Depression while all the people less fortunate lost all they had.First take it from them and then give it back to them from someone elses pockets and you get to be Presidents and powerful politicians.I think the American people have eaten all the smart pills they need now.


    January 16, 2010 10:07 am at 10:07 am |
  9. Keith in Austin

    I find it incredible that Obama talks about accountability and transparancy with the banking system. The sheer hyprocracy of this man is beyond belief!

    His tough words pale by the examples and lies he has expressed to the American people! Enough said!

    January 16, 2010 10:08 am at 10:08 am |
  10. Biased

    Same old drivel – Bush admin. bad – Obama speeds to save the day leaping tall buildings. If he wants taxpayer money back, he got most if it already from the banks with interest. Why is he so cavalier in that Fannie and Freddie, AIG, GM and Chrysler all get off scott free with no tax and no demands for repayment at all. Once again we are being delivered the strawman to hate while Obama considers himself to be the protector of all evil. This man really has some inflated ego and delusions of grandeur while always making us feel we need to hate to get even.

    January 16, 2010 10:08 am at 10:08 am |
  11. albert friday

    What this means is we won’t let Wall Street take the money, we will and it will be for your own good, because you don’t know what is best for America. WE Do!

    January 16, 2010 10:09 am at 10:09 am |
  12. Watchdog

    Obama proposes tax on ____________
    Just fill in the blank each day

    January 16, 2010 10:09 am at 10:09 am |
  13. Bruce

    This guy will ruin our country. His "common sense" approach is anything but. It's big government on steroids run amok.

    Fortunately his administration is angering so many people and putting such a harsh light on this socialistic approach, there is likely to be a revolt at the ballot box in 10 1/2 months. Personally, I can't wait.

    If Brown wins in MA, perhaps some of these liberal lockstep legislative lemmings will have an epiphany and move back to the center (where the people of this country are).

    January 16, 2010 10:10 am at 10:10 am |
  14. P R Barn

    Sounds good? I think not. Any fees passed on to businesses in turn get passed on to the public in the form of higher costs, higher fees, etc. The government is the last organization that should be dictating how any business should be operating. After all, the government has proven over and over again that they have absolutely no ability to balance finances or budget effectively. By the way, how mush of the taxpayers' money is being used for Obama to "campaign" in Massachusetts, or put fresh flowers in offices, or host parties for the sake of hosting parties? Using Obama's rational, one could argue that if the government can afford to "waste money", then the government can afford to pay us back the taxes it has collected. I'll start listening when someone is talking that "practices what they preach".

    January 16, 2010 10:16 am at 10:16 am |
  15. jerseylou

    That task would be huge Mr.President if it can be done.White Collar Crime is what got this Country into the mess it's in. Bernie Madoff is not enough,stealing with an ink pen is just as deadly as a gun.People won't believe you are other politicians until these laws are change.

    January 16, 2010 10:21 am at 10:21 am |
  16. Hugo

    Obama: We won't let Wall Street 'take the money and run'

    Translated this means we won't give Wall Street your tax dollars to give us our kick backs as campaign funds and inflated "employment opportunities for our lobbyist friends and families while creating a gravy train for our lawyer pals without the appearance to the public of some sort of pressure... Government created the problem, then poured gas on it!

    January 16, 2010 10:28 am at 10:28 am |
  17. anonymous

    ha and wat ru doin mr. obama

    January 16, 2010 10:30 am at 10:30 am |
  18. Puddin

    Bravo, Obama!!! Now, if the Repubs would stop trying to turn everything he does into a political game, this president just might succeed in getting the country back in step. I won't hold my breath that the politics with cease, however.

    January 16, 2010 10:30 am at 10:30 am |
  19. Ms S Callahan

    In days of old these individuals would have been tarred and feathered....

    This is not over...the ramifications of greed have many years ahead of us. It has not stopped, the greed continues..all while the 'fat' cats sit with their cigars off the coast. It must stop, and it's inevitable it wil.

    Though I don't like the idea of governement regulating income...it seems those responsible for this just haven't learned to do the right thing....I say ....Let the people go after them.

    January 16, 2010 10:33 am at 10:33 am |
  20. Zoomaster

    There is so much anger of US policy these days. I work at the website Storyburn and we see it in people's stories every day. Obama is out of touch and this health bill will send Unemployment north of 11% for a long time

    January 16, 2010 10:35 am at 10:35 am |
  21. Bill

    I don't care if you are a Republican, Democrat, Libertarian, or the ultra-conservative religious right, this makes sense.

    Of course, like he said, the Republicans and the financial institurions will fight this to the death.

    January 16, 2010 10:36 am at 10:36 am |
  22. dave

    there's no way, after all the lying and broken campaign promises, that i can trust him or the democratic party to look out for the American people. they are keeping the talks for heatlh care behind closed doors, do not want the American people to know what they are getting us into. they know that America will NOT agree with what they are doing, so they have to hide it from us. talk about a crooked administration. out with obama and the dems. lets get people in office with REAL morals...

    January 16, 2010 10:36 am at 10:36 am |
  23. Jay

    High fives for Obama.

    January 16, 2010 10:37 am at 10:37 am |
  24. Mike

    More psycho-Babel from our Liar-in-Chief.......that's what he does best......Basically, it is a conflict of interest for him to tell the truth now......he has lost the public trust.

    January 16, 2010 10:40 am at 10:40 am |
  25. Fitz in Texas

    Does this President ever get tired of blaming everyone else? President Obama is the one that takes most of the taxpayers money and runs with it.

    January 16, 2010 10:41 am at 10:41 am |
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