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Politics : The Obama - Clinton Disaster -- Ignore unavailable to you. Want to Upgrade?

To: GROUND ZERO™ who wrote (5429)	1/23/2009 7:32:55 PM
From: pompsander	Read Replies (1) \| Respond to of 103300

Obama Takes Aim at Wall Street Bonuses (Update2) By Julianna Goldman and Roger Runningen Jan. 23 (Bloomberg) -- President Barack Obama promised to impose more restrictions on future bailout money to prevent it from being used for such things as Wall Street bonuses. There has been a “lack of accountability and transparency in how we are managing some of these programs to stabilize the financial system,” Obama said before a meeting with congressional leaders at the White House. Obama cited “the reports that we’ve seen over the last couple of days about companies that have received taxpayer assistance, then going out and renovating bathrooms or offices or in other ways not managing those dollars appropriately.” While Obama didn’t mention any individuals or companies, his comments followed reports that John Thain, the former Merrill Lynch & Co. chief executive officer ousted yesterday, spent $1.2 million redecorating his downtown Manhattan office last year as the company was firing employees. Thain oversaw the sale of Merrill Lynch to Bank of America Corp. last month. Merrill’s $15.4 billion fourth-quarter loss forced Bank of America to seek additional aid from the U.S. government, which last week agreed to provide $20 billion in capital and $118 billion in asset guarantees. Congressional Objections Members of Congress had threatened to hold up release of the second half of the $700 billion Troubled Asset Relief Program over concerns about oversight. The Senate voted Jan. 16 to allow use of the bailout money after Obama assured lawmakers that more money would be directed to small businesses, would come with limits on executive compensation and the administration would detail how it is spent. Press secretary Robert Gibbs said the president has directed his economic team to come up with a plan for using the TARP funds, saying the money won’t go to “line the pockets of people” who’ve gotten financial assistance. “The American people need to be greatly assured that their hard-earned money is not going to the bonuses or the remodeling of an office at a bank that’s in trouble,” Gibbs said at a briefing. Gibbs wouldn’t say today whether the government would attempt to recover money spent on bonuses or projects not related to stabilizing the financial system and unfreezing credit markets. “I’m not going to get ahead of the recommendations” being put together, he said. Summers’s Assurances The restrictions would follow principles already outlined to Congress by Lawrence Summers, director of the White House National Economic Council, and Timothy Geithner, Obama’s nominee for Treasury secretary, Gibbs said. Summers told Congress in a Jan. 15 letter that up to $100 billion of the remaining funds will be used to ease the housing crisis. He also promised the administration would restrict executive pay and dividends for financial institutions that get the money. “Those receiving exceptional assistance will be subject to tough but sensible conditions that limit executive compensation until taxpayer money is paid back, ban dividend payments beyond de minimis amounts, and put limits on stock buybacks and the acquisition of already financially strong companies,” he wrote. Senator Bill Nelson, a member of the Finance Committee, said he talked today with Geithner and was told the administration would increase oversight of the TARP money. “I have received direct assurances today from the nominee for Treasury secretary that he will support disclosures and transparency including for money already spent,” said Nelson, a Florida Democrat. Nelson is co-sponsor of legislation that would require firms receiving the money to disclose how it’s spent and bar companies from using funds to lobby or make political donations. To contact the reporters on this story: Julianna Goldman in Washington at Jgoldman6@bloomberg.net; Roger Runningen in Washington at rrunningen@bloomberg.net Last Updated: January 23, 2009 17:16 EST