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Obama in weekly address: "we want the taxpayers' money back"

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WEEKLY ADDRESS: President Obama Vows to "Collect Every Dime" of Taxpayer Funds that Helped Big Banks

WASHINGTON - In this week's address, President Barack Obama proposed a fee on major financial firms to recoup - on behalf of American taxpayers - the $700 billion paid out in TARP, saying "we want the taxpayers' money back, and we're going to collect every dime." The President's proposal will only affect the largest financial institutions with the most debt, so it will not only help recover the TARP funds and reduce the deficit, but also crack down on some of the banking practices that led to the financial crisis.

The audio and video will be available online at www.whitehouse.gov at 6:00 am ET, Saturday, January 16, 2010.

Remarks of President Barack Obama
As Prepared for Delivery
Weekly Address
January 16, 2010

Over the past two years, more than seven million Americans have lost their jobs. Countless businesses have been forced to shut their doors. Few families have escaped the pain of this terrible recession. Rarely does a day go by that I do not hear from folks who are hurting. That is why we have pushed so hard to rebuild this economy.

But even as we work tirelessly to dig our way out of this hole, it is important that we address what led us into such a deep mess in the first place. Much of the turmoil of this recession was caused by the irresponsibility of banks and financial institutions on Wall Street. These financial firms took huge, reckless risks in pursuit of short-term profits and soaring bonuses. They gambled with borrowed money, without enough oversight or regard for the consequences. And when they lost, they lost big. Little more than a year ago, many of the largest and oldest financial firms in the world teetered on the brink of collapse, overwhelmed by the consequences of their irresponsible decisions. This financial crisis nearly pulled the entire economy into a second Great Depression.

As a result, the American people - struggling in their own right - were placed in a deeply unfair and unsatisfying position. Even though these financial firms were largely facing a crisis of their own creation, their failure could have led to an even greater calamity for the country. That is why the previous administration started a program - the Troubled Asset Relief Program, or TARP - to provide these financial institutions with funds to survive the turmoil they helped unleash. It was a distasteful but necessary thing to do.

Many originally feared that most of the $700 billion in TARP money would be lost. But when my administration came into office, we put in place rigorous rules for accountability and transparency, which cut the cost of the bailout dramatically. We have now recovered most of the money we provided to the banks. That's good news, but as far as I'm concerned, it's not good enough. We want the taxpayers' money back, and we're going to collect every dime.

That is why, this week, I proposed a new fee on major financial firms to compensate the American people for the extraordinary assistance they provided to the financial industry. And the fee would be in place until the American taxpayer is made whole. Only the largest financial firms with more than $50 billion in assets will be affected, not community banks. And the bigger the firm - and the more debt it holds - the larger the fee. Because we are not only going to recover our money and help close our deficits; we are going to attack some of the banking practices that led to the crisis.

That's important. The fact is, financial firms play an essential role in our economy. They provide capital and credit to families purchasing homes, students attending college, businesses looking to start up or expand. This is critical to our recovery. That is why our goal with this fee - and with the common-sense financial reforms we seek - is not to punish the financial industry. Our goal is to prevent the abuse and excess that nearly led to its collapse. Our goal is to promote fair dealings while punishing those who game the system; to encourage sustained growth while discouraging the speculative bubbles that inevitably burst. Ultimately, that is in the shared interest of the financial industry and the American people.

Of course, I would like the banks to embrace this sense of mutual responsibility. So far, though, they have ferociously fought financial reform. The industry has even joined forces with the opposition party to launch a massive lobbying campaign against common-sense rules to protect consumers and prevent another crisis.

Now, like clockwork, the banks and politicians who curry their favor are already trying to stop this fee from going into effect. The very same firms reaping billions of dollars in profits, and reportedly handing out more money in bonuses and compensation than ever before in history, are now pleading poverty. It's a sight to see.

Those who oppose this fee say the banks can't afford to pay back the American people without passing on the costs to their shareholders and customers. But that's hard to believe when there are reports that Wall Street is going to hand out more money in bonuses and compensation just this year than the cost of this fee over the next ten years. If the big financial firms can afford massive bonuses, they can afford to pay back the American people.

Those who oppose this fee have also had the audacity to suggest that it is somehow unfair. That because these firms have already returned what they borrowed directly, their obligation is fulfilled. But this willfully ignores the fact that the entire industry benefited not only from the bailout, but from the assistance extended to AIG and homeowners, and from the many unprecedented emergency actions taken by the Federal Reserve, the FDIC, and others to prevent a financial collapse. And it ignores a far greater unfairness: sticking the American taxpayer with the bill.

That is unacceptable to me, and to the American people. We're not going to let Wall Street take the money and run. We're going to pass this fee into law. And I'm going to continue to work with Congress on common-sense financial reforms to protect people and the economy from the kind of costly and painful crisis we've just been through. Because after a very tough two years, after a crisis that has caused so much havoc, if there is one lesson that we can learn, it's this: we cannot return to business as usual.

Thank you very much.

6 Comments

"We" Mr President? Who is "We"? We aren't getting anything back. "You" are taxing businesses who already paid back their debt and "You" are using that money to pay the debts of GM, a government majority owned company. Mr President, where is my part of the "We"? Sir, I want my tax dollars back because I want no part of propping up an automotive company who couldn't make it on their own. Please don't speak for "We", Mr President,because "We" aren't getting anything back!

How ironic that a democratic President has to complell the Banking Industry to act responsibly and give back the tax money. This bailout shows that the "free Market" is not free in extreme circumstances. Theses same patriots will oppose public education.

This is great news. I hope they put this tax on all of the bad faith insurance companies. The government needs to stop that corruption. For more info about bad faith insurance companies like State Farm and Hartford, go to badfaithinsurance.org.

How do you propose to get my 401k back? You want me to work till I am 90? Think a 1% tax will do it? Prevent it happening again? I want my vote back.

Great idea. This is a good step toward putting an end to the corruption in the insurance industry. See badfaithinsurance.org for details.

Mr. President, I and many of my friends are saying just throw the present politicians out and start with non-incumbents. I believe that if you force the private banks into a corner they will take the money and transfer their wealth into euros and devalue and possibly displace the dollar as the currency of choice for the rest of the world. We must nationalize the banks and make them come to us when they need money for their schemes, and pay us, instead of us paying them. Thank you for taking on health care, the challenge was very necessary but the method and approach has been deplorable. I would like to see universal health care of the low end variety and special care to be something that a person could pay for on their own. Sincerely Richard Dale Bailey.

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Lynn Sweet

Lynn Sweet is a columnist and the Washington Bureau Chief for the Chicago Sun-Times.

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This page contains a single entry by Lynn Sweet published on January 16, 2010 6:00 AM.

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