"Now, keep in mind -- I think it's very important to remind ourselves that there are a whole bunch of folks now who are feigning outrage about these bonuses that a year ago, or two years ago, or three years ago, said, well, we should never meddle in these compensation plans; these are the best and the brightest; they know what they're doing; that's part of the market -- and now, suddenly they're outraged.
The point that I've been trying to make consistently has been that we believe in the free market, we believe in capitalism, we believe in people getting rich, but we believe in people getting rich based on performance and
what they add in terms of value and the products and services that they create. And it's appropriate for us to have some regulatory mechanisms in place to ensure that we never have a situation where the government has to step in, or you've got taxpayers who are having to foot the bill for other people's mistakes.
That requires some regulatory framework. And my hope is that one of the lessons we learn here is, is that putting smart regulations in place -- oversight, transparency, accountability -- those things are not anti-market,
they're pro-market. When, last year, Barney Frank and I worked to allow shareholders to at least cast a non-binding vote on compensation packages, there were some people who attacked us saying government has no business doing that. Well, look, all we're trying to say is you've got to be accountable to somebody. And it's that measure of accountability that I think is part of what has made America strong, and we have to get back to those kinds of values.....
I want to repeat something that I said before the joint session: My interest is not protecting banks. My interest is protecting the American people; the people's 401(k)s; ordinary folks who have a credit line with a bank for their small business; people whose pension funds are invested in some of these financial institutions. The prospect of all of that unraveling would have been unacceptable -- an unacceptable risk.
Now, what we're trying to do is get ourselves in a position where we make sure that going forward we're not held hostage to all these bad decisions that were made by these huge institutions in the past, and that we create a system where they can't make all these bad bets, they can't issue these insurance policies one on top of the other without having the assets to back them up.
That's the kind of regulatory reform that we need. That's what these folks are going to be talking to the folks on the Hill about. And I am confident that we can strike the right balance that allows our financial system to stabilize, allows people to innovate in the financial markets, but don't allow them to put everybody else's savings, everybody else's well-being, other people's jobs, other people's homes at risk. And that's the task that lies before us and I'm confident with can get it done."
In related news, Congressional hearings on regulatory reform are continuing apace. Read more on this topic here.