A day after scornfully calling them “fat cats,” President Obama called leading bankers to the White House and told them to start making more homebuyer and small-business loans.
“My interest isn’t in vilifying any one person or institution or industry,” Obama said. “My job is to ensure that consumers and the larger economy are protected from risky speculation and predatory practices, that credit is flowing, that businesses can grow and jobs are once again being created.”
With the end of the year approaching, the administration is engaged in an intensive campaign to assign blame for the still-struggling economy, while taking credit for its modest improvements.
To that end, Obama is striking a flinty, new, no-nonsense tone — admonishing bankers to rethink their opposition to regulatory reform and extend more credit to help the economy.
Obama blamed the nation’s financial crisis in part on the banking industry, which earlier this year received a $700 billion taxpayer bailout — in part to address a crisis stemming from loans.
“I did not run for office to be helping out a bunch of you know, fat cat bankers on Wall Street,” the president told CBS News’ “60 Minutes.” “Nothing has been more frustrating to me this year than having to salvage a financial system at great expense to taxpayers that was precipitated, that was caused in part by completely irresponsible actions on Wall Street.”
Vilifying Wall Street is a tricky political gamble for Obama, who supported the Troubled Asset Relief Program and extended it to automakers, although he now calls the bailout distasteful.
Brian Olasov, a former Wall Street executive who consults on banking and finance for McKenna Long & Aldridge, said he’s doubtful bankers will fall in line with the White House.
“For the optics alone, they certainly have to be respectful, but these are decisions made by credit decision and compliance officers,” Olasov said.
With the various federal bailout programs ending and financial institutions moving away from loans and into cash, private lenders are not stepping in to fill the void, he said — meaning the economic recovery could be short-lived.
That would be bad news for Obama and the Democratic Party, which is heading into next year’s midterm elections with 10 percent unemployment, a tight credit market and only limited results from a massive, federal government spending program aimed at job creation and economic recovery.
To show they mean business, the administration scheduled two public appearances for Obama in connection with the bankers meeting, and dispatched senior administration officials to repeat the president’s talking points on television.
As a final flourish, after meeting with Obama contrite bankers faced reporters outside of the West Wing, where they promised to do better.
“As a group we haven’t done as good a job as we can in the future to align the interests of our constituents and of the American public,” said US Bancorp Chairman Richard Davis. “And I think we agreed that there are better ways to do that, and he gave us some very good ideas about how to be better at communicating that and describing that in real streets of America.”
