No He Can’t! Why Obama Won’t Tax Bank Bonuses

The chances of the U.S. following the U.K. in imposing punitive taxes on bank bonuses appear to be slim to none. “You’ll see politicians talk about it, but they won’t actually do it,” a senior investment banker told the Wall Street Journal today. Earlier this year, when the furor over Wall Street greed was at its height, Congress actually considered such a move but quickly backed away from it.

What nobody has explained is why the Obama Administration and Congress are so skittish about doing something that would be highly popular, and which also has sound economics behind it. As Clyde Prestowitz, president of the Washington-based Economic Strategy Institute and a former senior official at the Commerce Department, said to Bloomberg, a U.S. bonus tax is a “great idea” that is justified by the taxpayer-funded bailouts. “Goldman Sachs and the others may be making tons of money but they wouldn’t be making anything without the bailout, which saved them,” Prestowitz said. “There’s a lot of pain and agony out there because of their malfeasance.”

Here’s my two cents worth as to why it ain’t going to happen:

Read more: http://www.newyorker.com/online/blo...bama-wont-tax-bank-bonuses.html#ixzz0a2yFijNa


more...

http://www.newyorker.com/online/blogs/johncassidy/2009/12/why-obama-wont-tax-bank-bonuses.html

 

They can't tax the bonuses because the banks -- who own the country -- won't allow it. The government is not in charge of the banks, the banks are in charge of the government.

 

Right. A few decades ago, the bankers had to compete with industry for influence, but they won that battle for good when the auto companies went down.

 

The land of the free... greatest democracy on earth.... please.

Even a small country like Greece - riddled with corruption - is taxing their banksters at 90%!!!!

What does that say about our democracy?

What a farce.

 

It all depends on whether we would like financial jobs and companies move overseas...

 

Where would we all be if AIG moved overseas?

 

Rent seeking, market rigging companies.... that provide little societal value? hmmm..

Fuck 'em

 

The financial companies shouldn't let the door hit them on their way out... Screw 'em, private individuals can do a plenty good job of operating the risk pricing mechamisms of the capital markets. Big institutions are not needed for this purpose.

 

Both Britain and the USA are better off with these banks and financial institutions.

 

A problem with limiting comensation/taxing bonus from TARP related Banks is it will force them to make paying back TARP a priority over new lending.