the time people say, so sue me.
The President: So sue me, right.
Leno: I mean, the federal government is in debt a trillion dollars. We’re broke — sue us. Sue me. (Laughter and applause.)
The President: In fairness, I think that part of the calculation they were making was the way the contracts were written said, if you don’t pay us immediately, then we can claim three times as much as we were owed under the bonuses. And so they were making a legal calculation, and their legal judgment was not necessarily wrong.
But there’s a moral and an ethical aspect to this, as well. And I think that’s what has gotten everybody so fired up. The main thing –- we’re going to do everything we can to see if we can get these bonuses back. But I think the most important thing that we can do is make sure that we put in a bunch of financial regulatory mechanisms to prevent companies like an AIG holding the rest of us hostage. Because that’s –- that’s the real problem.
The problem is not just what’s happened over the last six months. The problem is what was happening for years, where people were able to take huge, excessive risks with other people’s money, putting the entire financial system at risk –- and there were no checks, there were no balances, there was nobody overseeing the process.
And so what we’re going to be moving very aggressively on –- even as we try to fix the current mess –- is make sure that before somebody makes a bad bet you say, hold on, you can’t do that.
Leno: Well, here’s something that kind of scared me. Today they passed this thing that says we’re going to tax 90 percent of these bonuses. And the part that scares me is, I mean, you’re a good guy –- if the government decides they don’t like a guy, all of a sudden, hey, we’re going to tax you and then, boom, and it passes. I mean, that seems a little scary as a taxpayer, they can just decide –- you want to take a break and answer that when we come back? Okay, hold that answer.
The President: I will. I’ve got a good answer, too. (Applause.)
* * * * *
Leno: Welcome back. We are talking with President Barack Obama.
Before the break I mentioned that they had just passed this new bill which will tax them 90 percent — and I said it was frightening to me as an American that Congress, whoever, could decide, I don’t like that group, let’s pass a law and tax them at 90 percent.
The President: Well, look, I understand Congress’ frustrations, and they’re responding to, I think, everybody’s anger. But I think that the best way to handle this is to make sure that you’ve closed the door before the horse gets out of the barn. And what happened here was the money has already gone out and people are scrambling to try to find ways to get back at