Wall Street Execs Set To Receive $Billions More In Bonuses

Obama administration officials on Sunday blasted record payouts to the nation's top Wall Street executives.

The nation's top financial firms, including many who benefited from money paid out by the federal government through the Troubled Asset Relief Program (TARP), are on track to receive billions more in compensation than they did last year.

"The bonuses are offensive," White House Senior Adviser David Axelrod said Sunday on ABC's "This Week".

Mr. Axelrod also attacked the banks' business practices, saying that the government passed out the TARP bailout funds to encourage more lending and said the banks have failed to live up to their end of that bargain.

"The most offensive thing is, we haven't seen the kind of increase in lending that we should," he said.

Wall Street payouts were set to increase 20 percent this year over the $117 billion paid out last year, according to the Wall Street Journal. The news was coupled with continuing job losses and stagnant lending -- two things the TARP funds, in part, were to curtail.

Even as the economy continues to struggle, much of Wall Street is minting money — and looking forward again to hefty bonuses.

Many Americans wonder how this can possibly be. How can some banks be prospering so soon after a financial collapse, even as legions of people worry about losing their jobs and their homes?

It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took last year to stabilize the financial system — reducing interest rates to near zero, bolstering big banks with taxpayer money, guaranteeing billions of dollars of financial institutions’ debts — helped set the stage for this new era of Wall Street wealth.

Titans like Goldman Sachs and JPMorgan Chase are making fortunes in hot areas like trading stocks and bonds, rather than in the ho-hum business of lending people money.

A year after the crisis struck, many of the industry’s behemoths — those institutions deemed too big to fail — are, in fact, getting bigger, not smaller. For many of them, it is business as usual. Over the last decade the financial sector was the fastest-growing part of the economy, with two-thirds of growth in gross domestic product attributable to incomes of workers in finance.

Now, the industry has new tools at its disposal, courtesy of the government.