Comments on: The legal and necessary bank tax A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: robdashu Fri, 22 Jan 2010 17:04:35 +0000 Taxing the banks is a no-brainer. They are given a license to create money, then charge people for its use. This is, IMO unethical and immoral in itself. The bankers have way too many “rights” as it is. The depositors should have rights, too, such as 100% reserve margins at savings institutions so they are not exposed to all of the banking and finance games and schemes unless they wish to be.

By: rational Fri, 22 Jan 2010 16:23:45 +0000 I agree with Felix and MSGret1. Remember first and foremost, if you raise the tax on banks, how are the banks going to pay for the increase? Of course they will raise the price for the consumer to use their products in order to maintain their profit line. So saying we are going after the Big Bad Banks is actually going after the people who use the facilities and it becomes but another way to take money from those individuals and gives it to the government.

By: MSGret1 Fri, 22 Jan 2010 01:49:26 +0000 Felix after reading the above comments, I draw one conclusion, the writers are either for or against regulation of big banks, tax.

Now let’s look at it from a 3D perspective. To do this we must make one assumption divided in two parts.

The government is not your friend and currently our government exist to promote more government, hence more power to government, hence less power to the people.

Since I assume the government is not my friend, I will approach the issue from a military point of view and that is, our government has become our enemy, under the guise of protection for the people and risk aversion.

The first question any military person ask when they see the enemies front is what are they hiding. So let’s send out a scout to see what is going on behind the lines.

So, why now does the president propose new laws and regulations? To protect citizens, raise taxes and control banks? Not really here are a few for consideration.

As in any war there are several fronts, major and minor. Each designed to send a different message to the enemy. This is part of a larger plan to win the war. In any war the winning side always loses battles.

After a battle is lost, the winner experiences jubilation, which usually leads to dropping their guard, then the real surprise offensive begins.

So what battle did the American people recently win? The proposed health care reform which was just today declared dead in it’s current form or is it? Where is the new attack coming from?

Regulations and proposed taxes on big banks and other financial institutions.

This does two thing, it takes the spotlight off health care and puts it on the big bad banks. Supposedly this is to protect the American people and prevent a financial crisis.

This proposal has already caused financial markets to decrease in value, hurting the American people. If passed, much of the profits and jobs made by American banks and other financial services, will move overseas. Does this protect Americans, does this create jobs, the only benefit I see is that it creates more government jobs.

UG me scout see possible ambush must be sure, so will continue on mission.

The two fronts we have seen are a smoke screens. A smoke screen is dropped on you’re enemy to keep them from seeing you, the American people have seen the smoke screen of defeated health care reform as a victory.


Any who, I digress, so let me wrap this up.

Bottom line scout thinks the American people are being led into an ambush. This ambush is the complete reversal of power from the people to the government.

By: q_is_too_short Thu, 21 Jan 2010 01:05:12 +0000 where do you get that $145 billion number?

By: AnonymousChef Wed, 20 Jan 2010 23:55:31 +0000 John,

Next time you should do more robust research before reaching legal conclusions. Felix is much closer to the mark than you are.

I think you lost the argument when you labeled the tax as being many multiples of its actual size (“hundreds of billions” is the new $90 billion, eh?)

First, the statute does not require the President to recover the funds from the financial industry as a whole. It limits who he can recover from to the financial industry, but that’s it.

Second, do you think bankers are stupid? Otherwise “the plan to recoup TARP payments will probably come from TARP beneficiaries” is not just forseeable, its patently obvious. Indeed, given that TARP funds were extended on the condition that they would be recovered through taxes, “recovering TARP funds” seems eminently legitimate to me.

And that the results were forseeable makes it very difficult to argue that the bill was ex post facto. They took the money knowing it would be recovered, and knowing that the fairest way to recover it would be from the TARP recipients. The law may have been ambiguous, but its not being applied retroactively.

Nor does the 10 year limitation mean it isn’t for the legitimate purpose of reducing risk at banks. Uh – its being proposed pursuant to a law that limits the President to seeking TARP losses. Further, there’s a legitimate purpose in helping to reduce the benefits of the reducing the moral hazard subsidy. After all, there’s no guarantee that there will still be a moral hazard play of the same size in ten years, so there’s no reason not to leave it to future legislators.

But in any event, I’m more interested in hearing how you reconcile your arguments that the bill is so severe it is confiscatory and that the President, by failing to make the tax tougher, is proving that his motives are pretextual.

By: ScottFree Wed, 20 Jan 2010 23:06:21 +0000 I don’t know whether the proposal would be considered a bill of attender but the law requires the President to make a proposal. It does not specify what the form of the tax should be. The fact that a law was passed requiring the President to propose some sort of tax in no way affects the constitutionality and any subsequent proposal. Lots of law have been found unconstitutional.

Personally though I like the tax as it is likely to disadvantage TBTF financial institutions. A more direct attack on the TBTF problem should be undertaken with or without this tax.

By: JohnCarney Wed, 20 Jan 2010 22:50:46 +0000 Sorry, Felix, but you don’t seem to understand attainder well.

Let’s take just one of your objections: the foreseeability of the tax. Actually, this tax was not foreseeable because instead of being directed at the “financial industry” it is directed at firms that took TARP funds and are over a certain size. That’s what makes it a prohibited targeted tax.

Furthermore, even if it was foreseeable, it is still unconstitutional.

By: guest Wed, 20 Jan 2010 21:25:25 +0000 Thanks for the clarifications Felix.