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Obama slams Wall Street on bonuses

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President calls the $18.4 billion in bonuses paid last year 'shameful'

President Barack Obama issued a withering critique Thursday of Wall Street corporate behavior, calling it "the height of irresponsibility" for Wall Street employees to be paid more than $18 billion in bonuses last year while their financial sector was crumbling. "It is shameful," Obama said from the Oval Office. "And part of what we're going to need is for the folks on Wall Street who are asking for help to show some restraint, and show some discipline, and show some sense of responsibility."

The president's comments, made with new Treasury Secretary Timothy Geithner at his side, came in swift response to a report that employees of the New York financial world garnered an estimated $18.4 billion in bonuses last year. The figure, from the New York state comptroller, drew prominent news coverage.

Yet Obama's stand also came just one day after he surrounded himself with well-paid chief executives at the White House. He had pulled in those business leaders and hailed them for being on the "front lines in seeing the enormous problems in our economy right now." The president said the public dislikes the idea of helping the financial sector, only to see the hole get bigger because of lavish spending. The comptroller's report found that Wall Street employees got paid about the same amount of bonuses as they did in the boom time of 2004.

Obama said he and Geithner will speak directly to Wall Street leaders about the bonuses, which threaten to undermine public support for more government intervention. The House just approved an economic stimulus plan that would cost taxpayers more than $800 billion; the Senate is considering its own version.

Separately, Congress also passed a $700 billion plan last year to shore up the financial sector.

"We're going to be having conversations as this process moves forward directly with these folks on Wall Street to underscore that they have to start acting in a more responsible fashion if we are to, together, get this economy rolling again," Obama said.

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

Obama's scathing rebuke of Wall Street came as he was trying to push through Congress an economic recovery plan he says will "save or create more than 3 million new jobs over the next few years."

Earlier Thursday, the Labor Department reported that almost 4.8 million Americans, an all-time high, were receiving unemployment benefits. That number is likely to grow as a slew of major U.S. companies have announced mass layoffs this month.

Companies have announced about 130,000 layoffs in January, according to an Associated Press tally.

The U.S. has been mired in a recession since December 2007. It is on track to be the longest downturn since World War II.

Obama's economic stimulus legislation is headed for the Senate after a surprisingly partisan vote in the House in which Republicans united in opposition and 11 mostly conservative Democrats defected. During Senate debate next week, the measure is expected to pick up at least some GOP support.

The $819 billion measure has attracted criticism from Republicans and, privately, from some Democrats for spending billions on Democratic favorites like education despite questions as to whether these expenditures would actually create new jobs.

But with unemployment at its highest level in a quarter-century, the banking industry wobbling despite the infusion of staggering sums of bailout money and states struggling with budget crises, Democrats said the legislation was desperately needed. Obama said Geithner has already had to step in to stop one company from taking delivery of a new corporate jet it planned to buy even after receiving billions of dollars of support from the government. That bank, Citigroup, canceled the deal earlier this week.

Obama’s strong words overshadowed the other part of his message, that he wants to roll out, in the coming weeks, new plans to regulate Wall Street and get more credit flowing to consumers again. The president considers such steps to work in tandem with the economic stimulus measures unfolding in Congress.


                                               Look at the flowers

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I've been avoiding politics, damn too negative. Thought this would be positive. But as long as I read it, Just saying "Shame on you" and making future regulations isn't enough. If their misuse of money is accounted for, we have the amount they need to pay back to the US citizens. That's what needs to be done. I can see why all the negative political posts. Thought it was just complaining but damn, it's right on. Depressing, out of my control, until there's somthing I can do, Gotta stay positive. At the least Obama's recognition of the truth is better than Bush's lies.

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