Obama chides banks, taps anger over Wall Street

President Barack Obama launched an onslaught against banks on Thursday over rising fees and efforts to block financial reform, tapping into public anger to garner support for his 2012 re-election campaign.

Obama, a Democrat who is pressing his case for re-election with unemployment stuck above 9 per cent, said his Republican opponents' primary plan to boost the economy involved rolling back financial reforms his administration fought to pass.

Obama spoke at a White House news conference after thousands of anti-Wall Street demonstrators protested at New York's financial district and in several US cities this week against economic inequality and the power of US financial institutions.

"I think people are frustrated and, you know, the protesters are giving voice to a more broad-based frustration about how our financial system works," Obama told reporters.

Obama said his "Dodd-Frank" financial reform bill was designed to prevent Wall Street abuses, and his emphasis on the subject indicated he would use that theme heavily in the 2012 presidential race.

"For us to have a healthy financial system, that requires that banks and other financial institutions compete on the basis of the best service and the best products and the best price," he said.

"It can't be competing on the basis of hidden fees, deceptive practices or, you know, derivative cocktails that nobody understands and that exposed the entire economy to enormous risks."

Using a populist tone aimed at voters, Obama chided banks and Republicans for trying to repeal the reform measures.

"What we've seen over the last year is not only did the financial sector with the Republican Party and Congress fight us every inch of the way, but now you've got these same folks suggesting that we should roll back all those reforms and go back to the way it was before the crisis," he said.

Bank of America said last week it planned to charge customers who use debit cards to make purchases a $5 monthly fee. Obama said recent hikes in fees charged by banks were not a good practice and were likely unfair to consumers.

The president said banks could charge what they like as long as there was accountability and transparency, and he stressed it was appropriate for the government to play an oversight role.

The depth of that oversight role is as much a political issue as it is a financial one.

Obama, who is pressing Republican lawmakers to back his recent proposal to create jobs, said the opposing party's presidential candidates were focusing their economic plans on repealing his Wall Street reforms.

"You've got Republican presidential candidates whose main economic policy proposals is, 'We'll get rid of the financial reforms that are designed to prevent the abuses that got us into this mess in the first place,'" he said.

"That does not make sense to the American people. They are frustrated by it, and they will continue to be frustrated by it until they get a sense that everybody's playing by the same set of rules and that you're rewarded for responsibility and doing the right thing as opposed to gaming the system."

US House of Representatives Speaker John Boehner, a Republican, said Obama had "given up on the country" to focus on his re-election rather than working with Republicans to boost the economy.

New York City protests over income inequality have spread to other US cities, with them underway or planned on Thursday in Austin, Texas; Tampa, Florida; Washington, and Houston.

Though criticising Wall Street can tap into populist support, it could hurt Obama's campaign pocketbook. Like other presidential candidates, Obama is courting Wall Street contributions for his political goals.

Obama already has a tenuous relationship with some in the financial community for his harsh rhetoric about corporate compensation at the beginning of his term.

Jobs sales pitch During his White House news conference, which lasted more than an hour, Obama continued a sales pitch for his $447 billion jobs package, saying it was necessary to avoid another recession.

"I would love nothing more than to see Congress act so aggressively that I can't campaign against them as a 'do nothing' Congress," he said, pressuring lawmakers to act.

Republicans say the proposal -- a mix of stimulus spending and tax cuts for workers and small businesses plus an end to some tax breaks for corporations and the rich -- will never pass as a whole but that certain parts are worth considering.

Some Democratic lawmakers are also not fans of the bill. In response, Senate Majority Leader Harry Reid said he would substitute a new millionaire's tax for some of the tax hikes Obama had proposed in order to win more support.

Nevertheless, Republicans are still expected to block the measure in the Senate and it faces stiff opposition in the Republican-controlled House of Representatives.