Goldman Sachs profits hailed by lawmakers

WASHINGTON (Reuters) - Democrats and Republicans alike lauded Goldman Sachs on Tuesday after the company, which received taxpayer assistance last year, said its quarterly profit rose and that it was setting aside billions for employees.

“Is there a law in the United States that you can’t make profits?” Representative Paul Kanjorski, a senior Democrat on the House Financial Services Committee, asked reporters.

Kanjorski said he hoped Goldman’s profits were a sign of economic recovery and a possible bellwether for other sectors. “I have great hope General Motors has great profits next year,” he said.

Last month, Goldman repaid the $10 billion that it received from the U.S. Treasury Department in October. In so doing, Goldman freed itself from government-imposed restrictions on executive pay.

The bank said its second quarter earnings rose 33 percent to $2.7 billion, and that it had put aside $6.65 billion for salaries, bonuses and benefits in the quarter, up by nearly half from a year ago.

“I want all the people we gave money to make profits. Pay the money back with interest and have a net zero cost to our program,” said House Democratic Leader Steny Hoyer.

The top Democrat in the Senate, Majority Leader Harry Reid, was restrained.

“I’m not in this statement criticizing Goldman Sachs because I don’t know how they made their money,” Reid told reporters. “But I’m glad, as I indicated, someone made some money.”

Richard Shelby, the top Republican on the Senate Banking Committee, said, “I’m not surprised. Goldman Sachs has a history of being well run and sometimes ahead of the others.”

There was no jubilation from the White House, however.

“I don’t know if the president has seen any of the information and I’m hesitant, as I think the Treasury is, to comment on individual earnings reports,” White House spokesman Robert Gibbs told reporters aboard Air Force One.

Reporting by John Poirier; Additional reporting by Jeremy Pelofsky, David Alexander, Tim Ahmann, Rachelle Younglai and Richard Cowan