CBS Early Show Praises Obama ‘Reading Riot Act’ to Banks

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At the top of Monday’s CBS Early Show, co-host Harry Smith enthusiastically proclaimed: “A frustrated President Obama gets set to read the riot act to the heads of America’s top banks.” Minutes later, Smith claimed it would be a “tough day for America’s biggest bankers” as the President planned to admonish them over executive compensation and lending practices at a White House meeting.  

White House correspondent Bill Plante followed with a report on the meeting: “...the bankers are likely to get an earful when they meet with the President later today and he previewed some of his frustrations over their bonuses and over their reluctance to make loans on 60 Minutes.” Plante referred to an interview the Obama gave to 60 Minutes’ Steve Kroft Sunday night, but none of the Early Show coverage mentioned the numerous parts of that interview in which Kroft grilled the President on topics ranging from Afghanistan to health care reform.  

During Plante’s report, the headline on-screen read: “Obama to Wall Street: Buck Up; Meets With Bank Heads to Change Behavior.” A clip of Obama on 60 Minutes was played: “They’re still puzzled why is it that people are mad at the banks. Well, let’s see. You guys are drawing down $10 - $20 million bonuses after America went through the worst economic year that it’s gone through in decades. And you guys caused the problem.”

Plante did get a business perspective on the topic: “...some Wall Street analysts say the banks aren’t lending because they don’t believe the recession is really over.” Jim Awad, managing director Zephyr Management, explained: “Banks are being conservative because they had a near death experience, they had a one-time bailout that they know can never be replicated, they want to ensure that they have capital so they can say ‘never ever again will we be in that position.’”

Before letting Plante go, Smith asked: “Bill, besides talking to Steve Kroft on 60 Minutes last night, the President talked to Oprah Winfrey, as well, and she asked him to give himself a grade for the year. What did he say?” Plante reported: “because he’s gotten a plan for Afghanistan and he’s moving troops out of Iraq, he gives himself a B-. But he says if he succeeds in getting health care passed, then it goes to – he gave himself a B+, I’m sorry, then it goes to A-. It’s kind of like an open book test.” Smith added: “Sounded like that. And who knows how the curve works.”

Here is a full transcript of the segment:

7:00AM TEASE:

HARRY SMITH: A frustrated President Obama gets set to read the riot act to the heads of America’s top banks.

BARACK OBAMA: The people on Wall Street still don’t get it. They don’t get it.

SMITH: We’ll preview today’s big meeting and hear more from the President’s interview on 60 Minutes.

7:01AM SEGMENT:

HARRY SMITH: First, this could be a tough day for America’s biggest bankers. They are scheduled to meet with President Obama today and CBS News senior White House correspondent Bill Plante has a preview. Good morning, Bill.

BILL PLANTE: Good morning, Harry. That’s right, the bankers are likely to get an earful when they meet with the President later today and he previewed some of his frustrations over their bonuses and over their reluctance to make loans on 60 Minutes.

[ON-SCREEN HEADLINE: Obama to Wall Street: Buck Up; Meets With Bank Heads to Change Behavior]

BARACK OBAMA: I did not run for office to be helping out a bunch of, you know, fat cat bankers on Wall Street.

PLANTE: The President told Steve Kroft of 60 Minutes the banks who paid back their government loan in order to payout big bonuses don’t get it.

OBAMA: They’re still puzzled why is it that people are mad at the banks. Well, let’s see. You guys are drawing down $10 - $20 million bonuses after America went through the worst economic year that it’s gone through in decades. And you guys caused the problem. And we’ve got 10% unemployment. Why do you think people might be a little frustrated?

PLANTE: So today, says presidential economic adviser Larry Summers, the officers of the 12 biggest banks will get this message from the President.

LARRY SUMMERS: They wouldn’t be where they are today and they certainly wouldn’t be paying the bonuses they’re paying today if their government hadn’t taken extraordinary actions.

PLANTE: Summers predicts that the job market will begin to improve by the spring, but some Wall Street analysts say the banks aren’t lending because they don’t believe the recession is really over.

JIM AWAD [MANAGING DIRECTOR, ZEPHYR MANAGEMENT]: Banks are being conservative because they had a near death experience, they had a one-time bailout that they know can never be replicated, they want to ensure that they have capital so they can say ‘never ever again will we be in that position.’

PLANTE: And there’s late word this morning that Citigroup, one of those banks, is paying back $20 billion today to the government or announcing it. They sill, however, are in a position where the taxpayers own 34% of the company. Harry.

SMITH: Bill, besides talking to Steve Kroft on 60 Minutes last night, the President talked to Oprah Winfrey, as well, and she asked him to give himself a grade for the year. What did he say?

PLANTE: Well, that was interesting. He gave himself this grade, he said because he’s gotten a plan for Afghanistan and he’s moving troops out of Iraq, he gives himself a B-. But he says if he succeeds in getting health care passed, then it goes to – he gave himself a B+, I’m sorry, then it goes to A-. It’s kind of like an open book test.

SMITH: Sounded like that. And who knows how the curve works. Alright, Bill Plante at the White House this morning. Thank you.