White House: Stance on Bonuses is More Than Talk

By: Brian Montopoli
Topics: Economy

(AP)

White House press secretary Robert Gibbs said Monday the White House's strong rhetoric over the weekend on the expected massive bonuses for employees of bailed-out Wall Street firms represents more than just talk.

"This is not hope," Gibbs said at his daily briefing after a reporter wondered if there is anything the White House can really do to limit the bonuses. "This is -- this is more."

Another reporter asked if there is "anything you guys can do to force them to lend, other than, you know, kind of jawbone." Firms like Goldman Sachs and JPMorgan Chase have made massive profits this year in large part thanks to their investment banking businesses even as consumer lending has remained sluggish.

"Well, I think, look, that there are obviously constraints in the law, and I would -- just in terms of executive compensation, as we've said before, we're not, we don't want to be in the business of deciding executive compensation," replied Gibbs. "I think people know excessive when they see it. I think the president, as you mentioned, has extremely strong views on this topic, on the topic of lending. And I think we hope that the actions of the bank will be demonstrated."

Gibbs said "we are involved now in a debate about what the regulatory landscape is going to look going forward to ensure that we never repeat again what happened last September." Echoing administration officials on Sunday, he complained that bailed-out banks are now "working actively against [establishing] consumer protections."

He urged banks "not to go back to the type of behavior that got us into this mess, to ensure that what the taxpayers have done is met by the banks with increased lending to small businesses and others that need access to much-needed capital."

A reporter asked if the White House is caught in the middle – seeking an increase in lending by banks to spur economic growth even as skittish regulators suggest that banks should avoid lending in order to fix their balance sheets.

"Well, look, I don't think anybody would suggest that we return to lending to consumers or anybody else that doesn't have the wherewithal to borrow and ultimately pay back the money," Gibbs said. "But nobody in this administration is suggesting that. I think the administration is simply suggesting that, with the responsibility borne by the taxpayer, responsibility is also borne by those recipients and others that were beneficiaries of the type of assistance that allowed those banks to continue, even though they had made record profits off of tremendously bad decision-making."

"This is not something that's going to be solved overnight," he added. "And the president and his team will continue to watch over it to ensure that lending is taking place and that, as we move forward, we'll get some rules of the road that won't let this be repeated again."

Read more: Wall Street Bonuses Could Mean Headache for Obama

Brian Montopoli
Brian Montopoli is the senior political reporter at CBSNews.com.
Follow on Twitter »

13 Comments Have Your Say
Email Story Send to a Friend
Share This Tell Your Friends
Tweet This Tweet This
More Share It

Add a Comment See all 13 Comments


by TJphoto October 20, 2009 10:14 AM EDT: When we have a Government that takes care of itself first before it takes care of anything else (CONGRESS - $174,000 per year, taxpayer paid retirement, 70% health care subsidy) Do you really expect them to regulate the people who give them sooooo much money. Nothing will change until we get ALL the money out of politics. CONGRESS (both parties) IS FOR SALE! Don't worry, in the next election cycle they will tell us "No more politics as usual"; Reply to this comment

by sjc_1 October 19, 2009 10:28 PM EDT

It is about time corporations started paying their fair share for doing business in America. THe corporate share of the federal budget has gone from 40% in the 60s to 7% now. If they paid their fair share, we could reduce the deficit and take some of the pressure off of the middle class worker.

Reply to this comment


by Ephaba October 20, 2009 9:28 AM EDT: White House: Stance on Bonuses is More Than Talk...

The last time they said this it was a lie and they deliberately allowed the bonuses because it is illegal to deny employees their contracted salaries.

What's it going to be this time? Just bufoonery and balogna instead of rhetoric and lies?

by stuart-johns2 October 19, 2009 9:59 PM EDT

I'll believe it when I see it.

Reply to this comment


by stn_sage October 19, 2009 10:37 PM EDT: I'll 'second' that! Or, SURE. SURE. SURE...it is!


by quapawsix October 19, 2009 7:25 PM EDT: Well if the Thieves don't like living in America the they have a constitutional right to leave.; Reply to this comment


by babooph October 19, 2009 5:06 PM EDT: Let the suckers have a bit of hope,but the lobbyists have it in their pocket-fed tax $$$ indirectly moved to the scam insurance crooks is the FINAL outcome.; Reply to this comment


by hungry1968-16 October 19, 2009 4:46 PM EDT: Corporatocracy is a failure, because corporate capitalists have allowed greed to over take their sense of right and wrong.

Everything is now designed to enhance power and monetary position, and if the country fails as a result, so be it. They just don't care about America.; Reply to this comment

by inketolstoy October 19, 2009 3:23 PM EDT

"Well, I think, look, that there are obviously constraints in the law, and I would -- just in terms of executive compensation, as we've said before, we're not, we don't want to be in the business of deciding executive compensation,"

Translation - The Whitehouse is not in the business of deciding executive compensation.

Sounds to me (outside of all the , I think, maybe --- but maybe not, uhmm, at least I hope so) like Gibbs is saying it is just talk, not actual threats that the President is using. You rats quit deviding up all the cheese amongst yourselves or I will be forced to strongly censure you in my speeches. Yeah, that will work.

Reply to this comment


by endurorob_5 October 19, 2009 3:26 PM EDT: The fact is the bonuses are paid out of the companies profits. Their is nothing illegal about that and the government has no authority to tell them how to spend their profits. Call it immoral if you want but they are using their own money. I would consider it less immoral than taking someone elses money and handing it out as the government does.


by endurorob_5 October 19, 2009 3:23 PM EDT: The fact is these insitutions paid back the bailout money withinterest so they are working with their own money. The only lesson they learned is that when their risk taking causes their business to be on the verge of tanking the government will bail them out. If you want them to learn a real lesson don't bail them out.; Reply to this comment


by endurorob_5 October 19, 2009 3:21 PM EDT: "Well, look, I don't think anybody would suggest that we return to lending to consumers or anybody else that doesn't have the wherewithal to borrow and ultimately pay back the money,"

Isn't there another story on this site about the government Guaranteeing high risk home loans?; Reply to this comment


by antoniof123 October 19, 2009 3:20 PM EDT: Big business: We know that we tanked the economy and are responsible for all the out of work people. We also know we have stolen and cheated and cause massive debt problems and got a massive bailout. But we have learned our lesson PLEASEEEEEE DON'T Regulate us we have learned our lesson and will never do it again.

Americans: Really, okay we know you have our best interest at heart and will never do it agian.

Big business: God Americans are sooooooo STUPID they will buy anything we tell them. Okay people here are your bonuses and remember to thank the American tax payers for it, (ya right).; Reply to this comment