More on the new Obama bank plan

January 21, 2010

Mark Calabria of Cato, a supersmart observer of the financial sector in DC, gives me his two cents:

I find it hard to believe that the govt has any clue as to what correct size and level of trading is for banks. Sounds like nothing more than cheap politics.

Ex ante, no one told Bear was too big. So is the size limit going to be even smaller than Bear?

Obama misses one reason for banks becoming so large: their fund advantage due to “too big to fail” – if he were serious he’d come up with a plan to end too big to fail, rather than a plan for permanent bailouts.

And where’s the break-up plan for fannie and freddie? Just seems like just picking winners and losers based on politics.

I don’t see it going anywhere in the Senate [though I’m] not completely ruling it out. House could easily pass something so stupid – it is the House after all.

It does complicate financial reform – Obama might just be killing financial reform – hard enough time reaching agreement.

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Taxes should be paid by all for our shared services: police, courts, military etc. We can’t have our own armies or competing courts and police departments. This is the role of government. “Fairly” raising those taxes will always be contentious. Our current byzantine system screams for reform. The “bank tax” is just the latest example of how far off course Washington has gone. Taxes are being wielded as clubs to inflict punishment on those out of favor with the current group of tyrants.

Through “sin” taxes, corporate taxes, “windfall profits” etc. we demonize profits and undermine the capitalist system that has put the US on top. If we go along with this we allow the left to imply that profits are immoral.

Posted by Pat Duggan | Report as abusive