WASHINGTON (Reuters) - President Barack Obama said on Monday that Wall Street banks had failed to show remorse for the “wild risks” that triggered a financial meltdown and helped to push the United States into recession.
Obama unveiled a sweeping regulatory overhaul in June aimed at improving government oversight of banks and markets to avert a repeat of the financial crisis.
“The problem that I’ve seen, at least, is you don’t get a sense that folks on Wall Street feel any remorse for taking all these risks,” Obama said in an interview with PBS television.
“You don’t get a sense that there’s been a change of culture and behavior as a consequence of what has happened. And that’s why the financial regulatory reform proposals that we put forward are so important,” he said.
Obama said the planned regulatory reforms would prevent Wall Street firms from taking the “wild risks” they had taken before the financial crisis. Shareholders should also have the right to weigh in on huge bonuses paid to executives, he said.
Wall Street paid more than $18 billion of bonuses in 2008, a year in which it needed trillions of dollars of taxpayer support.
Asked if he was concerned about the jump in profits reported by banks Goldman Sachs and JPMorgan Chase & Co, Obama said his administration had less leverage over them now that they had repaid government bailout money.
He said the measures put in his place by his government to stabilize the economy were working, despite unemployment projected to rise above 10 percent within months.
”I think we’ve put out the fire. The analogy I use sometimes is, we had this beautiful house. And there was a fire. We came in and we had to hose it down.
“The fire is now out, but what we’ve discovered is, we need some new tuckpointing, the roof’s leaking, the boiler’s out, oh, and by the way, we’re way behind on our mortgage,” he said.
Reporting by Ross Colvin and Jeff Mason; Editing by Peter Cooney