Don’t Tax the Banks, Break Them Up

[Donnachaidh]

http://www.counterpunch.org/2011/11/09/dont-tax-the-banks-break-them-up/

A number of “tax the banks” measures are being pushed by liberal pundits to pay to maintain social spending or to pay for future bank bailouts. These efforts ignore that taxpayers are still subsidizing the banks and that the banks continue to engage in socially destructive practices. In current circumstances adding taxes only gives a patina of legitimacy to the taxpayer-subsidized revenues that the systemically dangerous banks garner.

One suggestion making the rounds is that in order to offset the cuts in social spending soon to be recommended by Barack Obama’s “super-committee,” that banks pay a transaction tax on their financial transactions. This suggestion accepts the false premise that the bipartisan effort to cut social spending is driven by a shortage of government money to pay for these programs. Between the government’s ability to create money as needed, continued heavy spending on unnecessary wars and corporate subsidies and the deep pool of taxable resources held by top income earners, there is no fiscal emergency that warrants cuts in social spending. There is just the lack of political will to put the money into social spending.

A tax to pay for future bank bailouts suggests that the costs of the regular economic crises caused by the banks are limited to the amount of bailout money required to restore the banks to a position to create the next crisis. The true global costs are in the lost economic production, wealth destruction and the mass unemployment that these crises produce. Were the banks to be taxed on these true costs they would cease to exist immediately. Additionally, because of the too-big-to-fail doctrine any tax on the banks would simply refund a portion of the subsidy that taxpayers are currently providing them. The more transparent route than a tax would be to end the too-big-to-fail subsidy.

The way to deal with unneeded cuts in social spending is to address them directly for what they are. If Democrats and Republicans want to join hands to cut Social Security, Medicare and Medicaid then the temporary gloss of a bank tax is a temporary gloss and will more likely facilitate these cuts by giving culpable politicians cover. And if the costs of bank bailouts are only a small portion of the costs of the economic crises that the banks create then either render them incapable of creating economic crises or charge them the full costs to clean them up. Being party to the banker fiction that restoring the banks is all that matters only serves to restore the bankers.

[Jackpine Radical]

1. Nationalize the suckers.

[Taverner]

10. +1000

[leftstreet]

12. +1

[TBF]

18. Agree -

we bailed them out so they should belong to us - the tax payers.

[HopeHoops]

2. I agree. It should be fucking hard as hell for them to operate in more than one state.

And this incorporating in Delaware while having a "minor presence" (aka "headquarters") in New York is just fucked up. Corporations should have to incorporate in the state where they are based - meaning headquarters or primary operations.

[JHB]

3. Any reason not to do both? n/t

[Lint Head]

4. And while their at it eliminate health insurance companies. They are nothing more than banks.

They handle money and do not provide health care. They are one of the biggest factors of increasing health care costs. They schmooze pharmaceutical companies, hospitals, Durable Medical Equipment companies and doctors groups. I know providers complain about insurance companies. It's because they have become reliant on them. It's an economical addiction. A medical group would rather pursue payment from an umbrella company that represents a lot of beneficiaries than have to pursue each person for payment.

[defendandprotect]

5. Dust off the anti-trust/monopoly laws and get busy breaking up these corporations -- !!

[kentuck]

6. They should never have been permitted to spread around the world...

like a virus.

World banks they are. And they will bring down the world economy, not just the country they are doing business from.

[Nuclear Unicorn]

7. We need to get away from "too big to fail" towards "too small to harm many" n/t

[Philosopher King]

8. Fat Chance...

2008 Contributions to Federal Candidates
From Employees and PACS

----------------------Democrats-----Republicans
Goldman Sachs............77%............23%
Citigroup.....................65%............35%
J.P. Morgan Chase........63%............37%
Morgan Stanley...........57%............43%
Bank of America..........59%............41%

[Donnachaidh]

11. Can you provide a link to the site you pulled these stats from?

Because right off the bat it seems to lean towards rightwing propaganda. I doubt SERIOUSLY the Republicans got less money from GS than the Dems.

[Philosopher King]

14. Goldman Sachs is about as Democratic as they come (e.g., John Corzine).

Clearly, the numbers from my previous post were cherry picked in order to make a point. I simply googled Fat Cat Bankers and one of the first things that popped up was a Sun-Times opinion column. http://www.thesuntimes.com/opinions/columnists/x692839122/Fat-cat-democrat-bankers

However, in reality, PACs contributios are nearly split 50/50 between Democrats and Republicans. http://www.opensecrets.org/pacs/sector.php?txt=F03&cycle=2008

...but Goldman Sachs has always given more to Democrats.
http://www.opensecrets.org/pres08/contrib.php?cid=N00009638

[Donnachaidh]

15. Dem as they come? -- then explain Hank Paulson.

http://en.wikipedia.org/wiki/Henry_Paulson

The GS guy who held the country hostage was a BUSH crony.

And as you ADMITTED -- cherrypicking was done. While I don't like the fact that there are pacs out there, the original posting you posted looked and smelled like ass stats.

Cherrypicking -- pushing propaganda.

Republicans would NOT be fighting so hard to keep Wall Street and the 1 percenters happy if they weren't getting huge amounts of money. The truth is probably that the pukes know how to hide their money better than the dems.

[Philosopher King]

16. I would explain or describe Paulson the same way I would describe Robert Rubin.

Corrupt. http://en.wikipedia.org/wiki/Robert_Rubin

And then, there are the Lawyers & Lobbyists
PAC Contributions to Federal Candidates
Election cycle:

Total Amount: $4,762,114
Total to Democrats: $2,770,707 (58%)
Total to Republicans: $1,988,407 (42%)
Number of PACs making contributions: 124
http://www.opensecrets.org/pacs/sector.php?txt=K01&cycle=2012

The truth is that both sides are corrupt, and the status-quo is preserved by 99 percenters who believe that their 1 percenters are the "good guys."

[kentuck]

17. They are corporatists - not Democrats or Republicans...

in the general sense of the word.

[Hutzpa]

9. A swell idea

break them up and introduce stiffer regulations that will prevent them from buying
each other. Create an environment that encourages small business development that
will benefits its community.

[RainDog]

13. k&r n/t