Obama: Wall Street Bonuses During Recession Are “Shameful”

In the wake of the deepest and swiftest financial downturn in the history of the United States, the fact that Wall Street firms continue to hand out massive bonuses to executives is “shameful,” according to President Obama.

The President said that such moves were “the height of irresponsibility” before heading behind closed doors for a meeting with new Treasury Secretary Timothy Geithner and Vice President Joe Biden. Obama said that financial firms at the center of the nation’s economic meltdown should “show some restraint and show some discipline” in these trying times.

The President’s words were a clear shot across the bow of Wall Street, which has come under intense scrutiny for years of conduct blamed for causing, contributing to, or allowing the United States recession to happen. The comments also followed an angry call by Senate Banking Committee Chairman Christopher Dodd for the U.S. government to look into ways of forcing executives to refund their bonuses.

Billions in Bonuses Handed Out

In 2008, as the United States slumped deeper and deeper into a worsening recession, Wall Street gave out $18.4 billion in bonuses, according to statistics from the New York state comptroller. Shockingly, that astronomical amount was down nearly 44 percent from the previous year’s bonus total, which is a sure sign of years of financial frivolity on Wall Street.

As Main Street shuttered stores and people cut down on dinners out and other luxuries, Wall Street executives took home massive paydays while overseeing a crumbling financial empire. In one highly-publicized event, officials from the Big Three auto makers flew to Washington, D.C. in million-dollar corporate jets to ask for a taxpayer bailout. The contradiction did not go unnoticed.

When in public, executives at some of the world’s largest financial firms complained of record losses and the need for a financial bailout at the taxpayer’s expense, while behind doors, they happily pocketed billions in bonuses.

Payback, For a Switch

News of the huge Wall Street bonuses at a time when most Americans are happy to just have a job angered lawmakers, including Dodd, a Democrat from Connecticut. Dodd reportedly wants the Treasury Department to find a way to force the executives who got huge bonuses to repay the money.

Dodd called the practice “unacceptable.”

Is Wall Street Deserving of Help?

News of the Wall Street executive bonuses emerged just as Obama is trying to rally support on Capitol Hill and across the country for his economic stimulus plan, meant as a $700 billion cash injection for an economy that can’t seem to turn the corner toward better health.

While officials have said that drastic, unprecedented measures are necessary to avert further and more serious troubles, it is becoming harder and harder to feel sorry for Wall Street with news like billion-dollar bonuses, lavish company holiday parties, and corporate jets floating around.

But will the hard feelings for Wall Street prevent Obama from pushing through what may very well be the cure for what ails the economy? If so, Wall Street only has itself to blame.

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