President Obama has issued an angry statement about Wall Street bankers receiving billions in salary bonus last year. He declares that, along with Treasury Secretary Geithner, he will make this point to said bankers in upcoming conversations:
President Barack Obama said it is irresponsible and shameful for Wall Street bankers to be paid huge bonuses while the American public is dealing with economic hardship.
The president reacted harshly Thursday to reports that corporate employees got paid more than $18 billion in bonuses last year.
Said Obama: "That is the height of irresponsibility. It is shameful."
The president said he and new Treasury Secretary Timothy Geithner will have direct conversations with corporate leaders to make the point.
According to several Wall Street officials, senior administration members spent the weekend and the last few days reaching out to top bankers for their views on how a bad bank should be structured. Lawrence H. Summers, head of the White House's National Economic Council; Sheila C. Bair, the Federal Insurance Deposit Corporation chairwoman; and Mr. Geithner have been involved in the talks, the Wall Street officials said.
Federal policy makers are discussing how to use the second $350 billion portion of bailout funds. About $50 billion to $100 billion is expected to be allocated to stave off home foreclosures. That would leave up to $250 billion available for the banks, with the bulk going to buying troubled assets.
So, let me get this straight:
President Obama is outraged by the $18 billion going to salary bonuses on Wall Street;
President Obama and Treasury Secretary Geithner will make this point directly to Wall Street bankers;
The conversation will then return to exactly how President Obama and Treasury Secretary Geithner will give Wall Street bankers $250 billion in exchange for a bunch of worthless assests.
That doesn't make any sense. How outraged can the Obama administration really be about the $18 billion in bonuses when it is about to give a $250 billion bonus to Wall Street? How will giving the same banks, the same corporations and the same people an additional $250 billion prevent them from once again handing out the same $18 billion in bonuses in 2009? There are no new legal protections mandating that the banks act differently this time around. This is more like a reward than a punishment. Wouldn't you put up with a verbal lashing, even from the President, if it means not only you can keep $18 billion, but that you get another $250 billion on top of it?
Simply getting terse, either in a press release or in a conservation, won't solve anything. Please President Obama, don't buy up the bad assests.
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