Washington: As the Wall Street companies
have begun generating profits and dolling out hefty bonuses to
its executives, US President Barack Obama today said that
America now wants its money back which was spent to rescue
these firms from economic crisis.
"We want our money back! And we are going to get it,"
Obama said as he proposed a 'financial crisis responsibility
fee' to be imposed on major financial firms until the American
people are fully compensated for the extraordinary assistance
they provided to Wall Street.
"If these companies are in good enough shape to afford
massive bonuses, they are surely in good enough shape to
afford paying back every penny to taxpayers," Obama said.
"Now, our estimate is that the Troubled Asset Relief
Program (TARP) will end up costing taxpayers around USD 117
billion. Obviously, a lot less than the USD 700 billion that
people have feared, but still a lot of money," he added.
"The fee will be in place for 10 years, or as long as
it takes to raise the full amount necessary to cover all
taxpayer losses," he said, but was quick to clarify that this
will not be a cost borne by community banks or small financial
Only the largest firms, with more than USD 50 billion
in assets, will be affected.
"And the size of the fee each bank owes will be based
on its size and exposure to debt, so that we are recovering
tax dollars while promoting reform of the banking practices
that contributed to this crisis," he said.
Obama said that the US has endured the deepest
recession it has faced in generations, and much of the turmoil
was caused by irresponsibility on the part of banks and
"Firms took reckless risks in pursuit of short-term
profits and soaring bonuses, triggering a financial crisis
that nearly pulled the economy into a second great
depression," he said.
These banks were rescued by the tax-payer's money.
Through this fee and broader reforms that US seeks is not to
punish Wall Street firms but rather to prevent the abuse and
excess that nearly caused the collapse of many of these firms
and the financial system itself, he noted.
"We cannot go back to business as usual. And when we
see reports of firms once again engaging in risk bets to reap
quick rewards, when we see a return to compensation practices
that seem not to reflect what the country's been through, all
that looks like business as usual to me," Obama said.
First Published: Friday, January 15, 2010, 08:57