President Barack Obama says he cannot “govern out of anger” just because of public outrage over bonuses paid at financial institutions kept afloat by taxpayer dollars.
Obama’s declaration came as he pushed for a $3.6 trillion federal budget proposal that already is opposed from within his own party. As he seeks lawmakers’ support for his first budget, he took a political risk in signaling discomfort with a separate plan that slaps a punitive, 90 percent tax on bonuses paid to American International Group employees.
Obama, a law professor-turned-chief executive, said during an interview broadcast Sunday that he does not like the idea of “passing laws that are just targeting a handful of individuals” or using the tax code to punish people.
“Let’s see if there are ways of doing this that are both legal, that are constitutional, that uphold our basic principles of fairness, but don’t hamper us from getting the banking system back on track,” Obama said on CBS’ “60 Minutes.”
In a wide-ranging interview broadcast Sunday night, Obama said he expected the Senate would produce a much different and more acceptable version of the bill — one he could sign.
The AIG tax plan passed through the House with popular support from Americans frustrated the company received $170 billion in bailout money to avoid collapse, yet found $165 million to pay executives as bonuses.
Earlier Sunday, White House economic adviser Austan Goolsbee said his boss understood the nation’s anger and that the easiest thing would be for AIG executives to return the bonuses. “He’s going to look at what comes out of the House, what comes out of the Senate, see what ideas we have,” Goolsbee said.
More pressing for Obama, however, was his own federal budget proposal.
Senate Republicans warned of deficits that could climb to $20 trillion in coming years and a weakened dollar if Obama and his Democratic allies get their proposal passed.
But even some of Obama’s fellow Democrats aren’t in favor of the proposal, which makes changes to farm and energy policies. Fiscal conservatives also bemoan its impact on deficits; it could generate $9.3 trillion in red ink over the next decade.
Obama used the CBS interview to yet again defend Treasury Secretary Timothy Geithner and his plans to resuscitate the ailing financial system.
Geithner was set on Monday to detail plans to use $100 billion in federal bailout funds to leverage as much as $1 trillion in so-called toxic assets off the books of endangered banks.
Meanwhile, Sen. Judd Gregg, R-N.H., predicted Obama’s ambitious $3.6 trillion budget, including massive spending to save the economy, would put the country into bankruptcy and would never pass Congress.
“The practical implications of this is bankruptcy for the United States. There’s no other way around it,” Gregg said.
Goolsbee appeared on CBS’ “Face the Nation.” Gregg appeared on CNN’s “State of the Union.”
Copyright 2009 The Associated Press.