I think the banking industry will lose a lawsuit against the bank tax plan because it's a fee not clearly a tax - after all it's not an income tax or other means of established taxation. It's not a tax on bonuses. Although, tax versus fee in and of itself would be an interesting Supreme Court case. Some can argue it was unconstitutional to give that huge bailout to the banks and absorb moral hazard behind closed doors, even before TARP was fully passed by Congress. It clearly benefited the banks big-time. In lawsuits, you generally have to show damages to win relief. The government's action was an antidote to all the benefits they gave out first. Taxpayers did not come out great on the TARP deal, not like Buffett and private investors. TARP dollars were partially intended to shore up balance sheets and loosen credit for lending. Banks did not lend and traded the funds at incredible profits instead. Assessing a fee for that does not seem outlandish, even after-the-fact. The administration can say itâs not retroactive and it has nothing to do with TARP. Rather, itâs for moral hazard and too big to fail going forward only. They are tying it to TARP, to kill the FTT bills in Congress. Come to think of it, DeFazio will probably use this logic for his next bill draft. Not TARP and the 700 billion, but continued too big to fail and moral hazard. Darn. The article mentions the financial lobby thinks they will lose too. The more banks fight this, the more the President fights them back and wins political points. I guess we shall see tomorrow if the bank tax debate is good for front and center on election eve or not.
DeFazio will probably ask Dean Baker to write his new bill using Baker's logic in his most recent article posted a few pages back. Now they are counting way off the balance sheet and I know this as an accountant. Let's start counting the trillions saved and created due to TARP and other events around the recovery. Plenty of wall streeters and hedge funds stepped up to catch a falling knife when the progressive economists were forecasting depression. That hedge fund manager who bought the British banks and made 7 billion. There are tons of stories on our side and please list them. Presidents Obama and Bush have both made this case. In fact, as we approach the midterms the Dems need to defend TARP and Stimulus spending from Republicans and Tea Party members. Baker will wear out his welcome very soon. The Dems want to run on TARP success and the bank fee is that icing on that cake.
Many articles tonight. Vanguard full press. G7 leaning levy over FTT. Sorry links don't transfer with iPhone On Jan 18, 2010, at 10:30 PM, Google Alerts <googlealerts-noreply@google.com> wrote: Google News Alert for: financial transaction tax UK Bonus Impact Still Unclear, Myners Says Wall Street Journal However, he said the Prime Minister was still hoping to secure international consensus on a global levy or transactions tax on the industry as a way for the ... See all stories on this topic What Transaction Tax Foes Don't Say Financial Advisor Magazine (Dow Jones) Opponents of one proposed Wall Street reform, a financial transaction tax, have been quick to point out it will make owning mutual funds more ... See all stories on this topic Britain to hold 'Tobin tax' debates The Press Association Britain is pushing ahead with international discussions on a "Tobin tax" on financial transactions to reduce deficits caused by the banking crisis and to ... See all stories on this topic Extend bank tax to do the business The Guardian A broadly based transactions tax â that would apply not only to stock, but also to options, futures, credit default swaps and other financial instruments ... See all stories on this topic They Still Don't Get It: Wall Street May Sue Obama Firedoglake (blog) ... amounting to a pittance and far from what I and others supportâa much broader, permanent financial transactions tax to tamp down speculation and pay for ... See all stories on this topic How the big banks rigged the market Financial Times ... the chairman of Britain's Financial Services Authority. He has suggested a transaction tax to deal with the problem in wholesale markets. ... See all stories on this topic Restoring Faith in Financial Markets Wall Street Journal ... a federal transfer tax on securities transactions; or a tax on short-term realized capital gains (say, shares held for less than six months), ... See all stories on this topic Daily Mail ALEX BRUMMER: End to chocolate's phoney war Daily Mail What is, however, certain is that the US, with its suspicion of international organisations, is unlikely to approve a transactions tax of the kind being ... See all stories on this topic Britain to host January G-7 meeting BusinessWeek Brown also raised the idea of a tax on financial transactions, but that is not on the table for the London meeting of finance officials. ... See all stories on this topic Tip: Use a minus sign (-) in front of terms in your query that you want to exclude. Learn more. Remove this alert. Create another alert. Manage your alerts.
State of the Union Jan. 27, budget unveiled Feb. 1 http://www.politico.com/livepulse/0110/SOTU_Jan_27_budget_unveiled_Feb_1.html The State of the Union speech will be very important. The Deficit Reduction Commission may be discussed. That is the bi-partisan commission where, according to the WSJ, the Democrats will offer items that the Republicans are seeking in return for Republican support on one of several items, one of which is a financial transaction tax.
Reader Comment section at the bottom. http://www.southcoasttoday.com/apps/pbcs.dll/article?AID=/20100119/OPINION/1190325/-1/NEWS06
I'm really not sure how to interpret this, but perhaps it points more towards a consensus being most achievable on a bank levy type of thing, instead of a FTT: http://www.iii.co.uk/news/?type=afxnews&articleid=7711321&subject=companies&action=article (AFX UK Focus) 2010-01-19 07:10 German FinMin-sees possible global plan for banks BERLIN, Jan 19 (Reuters) - German Finance Minister Wolfgang Schaeuble said on Tuesday he saw growing signs of achieving a possible international agreement on measures to tackle the banking sector. Noting that Germany has pushed for a financial transaction tax, he also said it was very pleasing that the United States had proposed a measure for a levy on banks to repay taxpayers for bailouts. "I see a better chance that we achieve what the chancellor and the government would like -- that is to say a worldwide settlement," Schaeuble told Deutschlandfunk radio. "The signs are increasing that we could really come to such a consensus."
The northern European country opted for a direct levy on bank loans rather than imposing a tax on transactions â such as buying investments â because a similar move after the country's 1990s banking crisis backfired. âWe had a transaction tax,â Mr. Borg said. âBasically, the transactions moved to London. But you cannot move your balance sheet.â Britain's opposition Conservatives, who are widely expected to return to power at national elections this year, have voiced support for the Swedish idea. http://www.theglobeandmail.com/report-on-business/eu-urged-to-adopt-bank-supertax/article1436017/
I have seen this same article on a different site, but this time this pro tax article is in the WSJ. The article mentions Sauter of Vanguard, but conveniently omits his estimate of a 2% annual loss for the long term investor because of increased spread cost, etc. Proposed Tax May Help, Not Hurt, Small Investors http://online.wsj.com/article/SB10001424052748704381604575005562735357750.html?mod=googlenews_wsj
IMF Response: I received a generic response from the IMF regarding an e-mail I submitted pertaining to their upcoming report in April. Here it is: Thank you for your e-mail. The comments, inputs and suggestions received will be treated in a confidential manner. Anonymous comments cannot be considered. All participants need to provide the following information: name, last name, organization, e-mail and phone number. The IMF Civil Society Team will receive the comments and will post a summary of them (some editions might be needed) on a weekly basis. The comments will be submitted to the IMF team in charge of the overall Financial Sector Taxation exercise. With kind regards, IMF Civil Society Team International Monetary Fund 700 19th St. NW Washington, DC 20431 USA Tel: +1-202-623-9400 Fax: +1-202-623-6220 Email: ngoliaison@imf.org Web: http://www.imf.org/civilsociety