January 10th, 2010
12:12 PM ET
12 years ago

Romer: Prospect of big banker bonuses 'offends me'

Washington (CNN) – One of President Obama’s top economic advisers took aim Sunday at the large bonuses Wall Street bankers are expected to receive soon.

“We will see in the next week or two, five-, six-digit, seven-digit, maybe even, some say, eight-digit bonuses for people in the banking industry,” CNN Chief National Correspondent John King said Sunday on CNN’s State of the Union. “Is there a message from the Obama White House to the banks as they prepare to make these big [bonus] announcements?”

“For Heaven’s sakes people,” Christina Romer, Chair of Obama’s Council of Economic Advisers, said in response, after pausing and appearing at a loss for words. “It does seem really ridiculous. We have had to take extraordinary actions to rescue the financial system. We always did it because that’s what had to be done for the American people. No one wanted to bail out the banks just for the banks’ sake. It’s because we know that credit is the lifeblood of a modern economy.”

“You would certainly think that the financial institutions that are now doing a little better would have some sense. This big bonus season - of course it offends the American people. It offends me,” Romer also told King.

Romer was circumspect when asked about the nation’s economy which continues to struggle more than a year after the financial crisis of late 2008 threatened another depression.

Asked to make a longer-term prediction about where the national unemployment rate, currently at 10 percent, will be at the end of 2010, Romer said “we are continuing a pattern of moderating job loss.” The top Obama economic adviser pointed out that job losses in the first quarter of 2009 averaged 691,000 per month. That figure dropped to 69,000 per month in the fourth quarter of 2009, Romer said. “That’s still way too many. It’s not job gains but it’s about a tenth of when we came to office,” Romer told King.

Related video: Good news in job numbers?

And Romer called the administration’s prediction that job growth would turn positive by the spring of 2010 “a realistic estimate.” She also said that the nation’s gross domestic product, a key measure of the economy’s overall health, needs to grow at roughly two and a half percent annually in order for the unemployment rate to begin to decline.

Pressed by King about whether the unemployment rate will be lower in November when Democrats are expected to face a tough political landscape during the midterm elections, Romer said, “I don’t want to make a prediction just because there is so much uncertainty.”

“What I know is we are seeing steady progress. I’d absolutely expect that progress to continue through next year, and, I hope accelerate.”

Filed under: Christina Romer • Economy • State of the Union
soundoff (51 Responses)
  1. Hugo

    Typical liberal Democrat, a substantial bonus to the CEO of a successfully run corporation offends them however the 50 billion a year lost in litigation costs by ambulance chasing lawyers with regard to healthcare costs is deemed trivial. Do you think it might be that the trial lawyer lobbyist group is among the top contributors to the DNC???

    January 10, 2010 02:11 pm at 2:11 pm |
  2. TOTUS

    Romer and her gang of inept socialistic economic "experts" offend me much more, because they are rapidly putting our country down the path of socio-economic destruction. They must be stopped.

    January 10, 2010 02:11 pm at 2:11 pm |
  3. Marko,TX

    Banks are raping the American people over and over. When is it this going to stop??? Bank have become nothing but legalized thugs.

    January 10, 2010 02:12 pm at 2:12 pm |
  4. Bethie

    You think the housing mortgage rate was a crisis???...want until these people with 60 -70% interest rates on their credit cards start to default all over America. We've only just begun people. Buck up hard times are a commin!!

    January 10, 2010 02:15 pm at 2:15 pm |
  5. wait a minute

    Corporate greed will destroy America, but where can these corporate rich go after that? Is there such a thing called Gypsy Rich?

    January 10, 2010 02:16 pm at 2:16 pm |
  6. Justin

    Bankers can now charge the consumer anything they want in interest rates. The sky is the limit and who going to stop them??? Hard times are a cumming America!!

    January 10, 2010 02:17 pm at 2:17 pm |
  7. T

    How about tax it appropriately, then take the portion for Soc Sec & Medicare/caid out? There should be no max limit on the removal of Soc Sec & Medicare/caid taxes taken out of a persons pay check. If it is income, it deserves to be treated as such like for all the actual working folks.

    January 10, 2010 02:24 pm at 2:24 pm |
  8. Stanton Gene Kawaihinano Otero

    Oh for crying out loud already...these banking and corporate business hacks need to go to prison already! Bank of America is NOT for Americans, and neither are any other large banking institutions nor corporations. When oh when will some of these fat cat thieves be put behind bars? I can not BELIEVE that there has been no punitive action taken...university students are harassed by collection agencies because of federal student loan defaults (and these students having degrees in teaching or social work and other helping professions), and yet these 3 piece suite criminals which bilk MILLIONS from the citizenry of this country only get MORE MORE MORE!?!?! This is just plain obscene.

    January 10, 2010 02:28 pm at 2:28 pm |
  9. Brad/San Diego

    The republicans do not care about the poor american people only the rich,and if you think that they can fix the problems that this county has think again. All they want is your vote and then to hell with you untill the next election, and more lies.

    January 10, 2010 02:31 pm at 2:31 pm |
  10. Christina......

    too bad your'e not smart enough to earn the big bucks and the big bonuses......stop whining...and go back to your cubby hole.

    January 10, 2010 02:40 pm at 2:40 pm |
  11. Ms. Romer.....

    just have Obama pay you by the pound and you"ll make as much as the bankers.

    January 10, 2010 02:42 pm at 2:42 pm |
  12. Mark

    What about the big bonus that were passed out on Christmas Eve to freddie mac and fannie may, a blank check to cover all loss and huge bonuses to the CEO's. We have billions invested into these two companies and it's ok for them to do this? Could it be because these two companies and the CEO's of them have donated lot's of money to the obama campaign? nahhhhhhh they wouldn't do that in chicago would they?

    January 10, 2010 02:45 pm at 2:45 pm |
  13. Leith

    The defense of these obscenely large paychecks and bonuses is that the banks need to "attract and reward talent." Just what IS this "talent?" It looks like the main "talents" are what El Kababa listed. People complained at the time about how the bailout didn't have constraints to keep the perpetrators from continuing their old habits. Lee Iacoca set an example worth following.

    January 10, 2010 02:53 pm at 2:53 pm |
  14. S Callahan NYS

    Credit shouldn't be the lifeblood, only an ocassional infusion....it should be savings that flow. I live in NYS where the State benifits from this practice of bonuses which in itself isn't evil or bad as it is a reward for hard work. BUT the issue here is ..they would have no work if the Governement did not bail out their employer period, and the other thought is that their bosses would hold even more profits if they don't give the bonuses....so who wins...again...telling, the Corporations that have a few slimy, ill fit, people sitting around doing nothing but collecting the dollars. Sad for them though, it won't go to heaven with them and neither will they.

    January 10, 2010 03:01 pm at 3:01 pm |
  15. RandyW

    Tom, I agree – "Don't blame the Obama Administration, blame the banks. Just pull your money out and put it in regional and or local banks, closer to home where it will be used." I would add if you don't have a nice local bank find a nice local credit union.

    Like our jobs, if you don't want them to keep going overseas, buy America.

    January 10, 2010 03:04 pm at 3:04 pm |
  16. unemployed by Obama

    Oh why not lie some more. What qualifies Romer for her salary other than she is a buddy of Obama. She needs to step down as Obama needs to step down for past racist remarks.

    January 10, 2010 03:09 pm at 3:09 pm |
  17. LacrosseMom

    It is offensive that the too-big-to-fail-banks, are now giving themselves bonuses!

    Let's not forget America, that during the Wall Street & Banking crisis of 2008, a Republican was president.

    Let's not forget that Hank Paulsen, Bush's Sec. of Treasury, was a former Goldman Sachs chief ...... who personally wrote the "Bail Out Bill" and who included a clause in the Bill, that the Bill could NOT be debated in Congress.

    Please America, read, study the past, especially what lead to the 2008 Banking Crisis. Be aware of GOP lies! Don't be fooled again!

    January 10, 2010 03:11 pm at 3:11 pm |
  18. Margo

    Robing the consumers at every turn.....and no one to stop them. Sad day for America.

    January 10, 2010 03:12 pm at 3:12 pm |
  19. Rota

    Legalized thugs out to scam American consumers. All legal in the eyes of our government.

    January 10, 2010 03:14 pm at 3:14 pm |
  20. Allison

    Just remember it was the Bush Administration that lifted all banking regulations from banks. Just another mess President Obama has to clean up.

    January 10, 2010 03:15 pm at 3:15 pm |
  21. kent

    Everyone spouts off about being "offfended". We've heard all this before, so why does it continue???? All legal in the eyes of our government. Rape and re-rape I guess.

    January 10, 2010 03:17 pm at 3:17 pm |
  22. Aunt Bea and Opie

    The bankers wont be happy till they get every last dime from the American people,just like the moneychangers at the time of Christ.This isnt a partisan issue,they own the right and the left,and play them against each other to get us fighting each other instead of them.

    January 10, 2010 03:19 pm at 3:19 pm |
  23. harvey

    Shouldnt you be equally angry at the white house, and senator chris dodd for insureing there was language in the stimulus bill that guranteed those same bonus's be paid ?

    January 10, 2010 03:31 pm at 3:31 pm |
  24. Rauwsdower

    President Obama's staff and advisers are all civil rights lawyers, old school bankers, and good for nothing academics. How in this world is anything going to get done ? Please tell us how people with no practical business experience are going to fix an economy that is based on free enterprise...( or what's left of it ) ? These people are just talkers NOT doers. They never had any experience making money...WHY WHY WHY I ask. A staff based on complainers, talkers, spenders and thieves.

    January 10, 2010 03:44 pm at 3:44 pm |
  25. Charles Stehle

    What about all the high paid management and pols in waiting at the FNMAE and FREDDIE MAC who got big bonuses? Not tomention various govt workers with bonuses. Sickens me.

    January 10, 2010 03:59 pm at 3:59 pm |
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