During Wednesday's hearing before the House Financial Services Committee, Citigroup chief executive Vikram Pandit offered a curious mea culpa in response to criticism triggered by his firm's plan to buy a new corporate jet after receiving $45 billion in bailout money:
We did not adjust quickly enough to this new world, and I take personal responsibility for that mistake. In the end, I canceled delivery. We need to do a better job of acknowledging and embracing the new realities.
So Pandit says Wall Street needs to get real, but the seven other Wall Street CEOs who joined Pandit in testifying on the Hill showed little indication they knew how to get in touch with that new Wall Street reality. When Representative Brad Sherman (D-CA) asked the executives if they would continue to own or lease corporate jets, all but one—Lloyd Blankfein of Goldman Sachs—said they would.
Next Sherman asked the CEOs if they would institute a policy to withhold dividends from shareholders until the $125 billion they received in bailout funds from taxpayers is repaid.
Only Pandit, Ken Lewis of Bank of America, and Ronald Logue of State Street Corporation said they would pay taxpayers before shareholders.
The new reality on Wall Street is that taxpayer money is keeping the firms afloat, though some firms, such as Goldman, arguably could have weathered the crisis without TARP funds. CEOs like Pandit say they're aware they have to change their priorities. But don't the taxpayers deserve more than empty words? Like, maybe, our $125 billion back?