Why Obama Doesn’t Begrudge Bankers Their Bonuses This Year
In an interview with Business Week, Obama said that he didn’t “begrudge” J.P. Morgan Chase CEO Jamie Dimon or Goldman Sachs CEO Lloyd Blankfein their bonuses for 2009, which amounted to $17 million and $9 million in stocks. While this has spurred outrage and unfavorable comparisons to last year’s remarks blasting the $121 million in bonuses at AIG, there are a few good reasons why lavish bonuses might be more justifiable this time around.
- Goldman Sachs made $13 billion in 2009, after losing $780 million (after taxes) in 2008.
- Chase doubled its 2008 profits to $11.7 billion in 2009.
- Chase repaid its TARP money in full by July 2009.
- Goldman repaid its TARP money with a 23 percent profit by July 2009.
- Neither Dimon nor Blankfein took a bonus for 2008.
- For 2007, Dimon received a $28 million bonus that was not restricted to stock.
- For 2007, Blankfein received a $67.9 million bonus, including $26.8 million in cash and $41.1 million in restricted stock and stock options.
- J.P. Morgan Chase made a profit every quarter during and despite the financial crisis.
- Goldman’s stock doubled in value last year and its profits were at a record high.
So, what did the president say?
“I know both those guys; they are very savvy businessmen,” Obama said in the interview yesterday in the Oval Office with Bloomberg BusinessWeek, which will appear on newsstands Friday. “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free-market system.”
He does, however, view the amounts as shocking.
But who would have guessed! Our president doesn’t begrudge CEOs bonuses that are smaller than they were before the crisis, when their companies were hugely profitable and their TARP money had been repaid? What kind of socialist is he, anyway?