Obama playing nice to Wall St now, sez the WSJ

I was going to write about this (h/t TPM):

Bankers were shell-shocked, especially when Congress moved to heavily tax bonuses. When administration officials began calling them to talk about the next phase of the bailout, the bankers turned the tables. They used the calls to lobby against the antibonus legislation, Wall Street executives say. Several big firms called Treasury and White House officials to urge a more reasonable approach, both sides say. The banks’ message: If you want our help to get credit flowing again to consumers and businesses, stop the rush to penalize our bonuses.

But then Hilzoy beat me to it:

That would be an absolutely appalling thing to do under any circumstances. It would be doubly appalling since these very people bear a lot of responsibility for that crisis. But the fact that they are making these threats not over some large issue of principle, but over their bonuses — that’s just breathtaking.

It’s worth saying again: banks and other institutions that were bailed out by the federal government weren’t bailed out because the government was feeling generous, and thought a gift might be in order. The government bailed out banks that were on the verge of failure, or on the verge of causing other big institutions to fail. The bailout thus saved those institutions (and the jobs contained within) and helped out the economy at large by sparing other banks. If the government didn’t bail out those banks, they probably would have failed, causing job losses at those banks and probably at many others. And now these people are mad because their bonuses might get taken back. You tell me what’s better: having a job, or getting a bonus. (Here’s a hint: if you don’t have a job, you don’t get any money at all, let alone a “bonus”).


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