CBS's Kroft to Obama: 'Are You Punch-Drunk?'

In a wide ranging interview broadcast Sunday night, Obama was pressed by Steve Kroft on "60 Minutes" for at times laughing or smiling while discussing the global economic crisis.

"You're sitting here. And you're laughing. You are laughing about some of these problems," Kroft told the president. "Are people going to look at this and say, 'I mean, he's sitting there just making jokes about money?' How do you deal with -- I mean: explain ... Are you punch-drunk?"

"No, no. There's gotta be a little gallows humor to get you through the day," Obama replied, with a laugh.

The president also acknowledged surprise at how quickly the U.S. economy crumbled between his November election and January inauguration.

"I don't think that we anticipated how steep the decline would be," he said in the "60 Minutes" interview on CBS television. "That slope is a lot steeper than anything that we've said -- we've seen before."

Obama wagered significant political capital Sunday, signaling opposition to a highly popular congressional drive to slap a punitive 90 percent tax on bonuses to big earners at financial institutions already deeply in debt to taxpayers.

The president defended his stand by saying the tax, passed quickly in the House of Representatives last week, would be unconstitutional and that he would not "govern out of anger." He declared his determination, nevertheless, to make Wall Street understand it must shed "the old way of doing business."

There was considerable political risk attached to Obama's implied rejection of the 90 percent tax measure. It raced through the House of Representatives as lawmakers responded to a wave of American anger over bonus payments to American International Group Inc. employees.

A week ago, the company paid out at least $165 million in bonuses even though taxpayers were keeping the insurance giant afloat with a $170 billion government bailout.

While questioning the legality and constitutionality of the House measure, Obama said he expected the Senate would produce a much different and acceptable version of the bill -- one that he could sign.

In a portion of the interview taped in the Oval Office, Obama issued his standard and optimistic long-term prognosis for the economy, but responded, "Yes," when asked if "the financial system could still implode if you had a big failure at AIG or at Citicorp?"

And the president explained that he felt caught in a balancing act, trying to assuage taxpayer anger at Wall Street with the need for support from the financial sector for his attempts to stop the country from plunging into fiscal turmoil unseen since the 1930s Great Depression.

"I think that you've got a pretty egregious situation here (bonus payments) that people are understandably upset about," he said in the interview taped on Friday. "And so let's see if there are ways of doing this that are both legal, that are constitutional -- that uphold our basic principles of fairness, but don't hamper us from getting the banking system -- back on track."

Earlier Sunday, Jared Berets, Vice President Joe Biden's economic adviser, previewed Obama's opposition to the AIG tax plan, saying it "may be a dangerous way to go."

And White House economic adviser Austen Goolsbee said his boss understood the nation's anger and that the easiest thing would be for AIG executives to return the bonuses. "He's going to look at what comes out of the House, what comes out of the Senate, see what ideas we have," Goolsbee said.

Obama used the CBS interview to yet again defend Treasury Secretary Timothy Geithner and his plans to resuscitate the ailing financial system. He said even if Geithner tendered his resignation, he wouldn't accept it.