Bailout is actually more than $700bn

[MrFun]

Originally posted by Kidicious
I take it the fact that this was done in an underhanded manner is just fine with NGR.

Of course! All you have to do is wave the idea of "lower taxes" in front of NGR and he will start drooling and willing to bend over and accept any means to get "lower taxes" for the wealthy.

[Velociryx]

Ahhh...so if we lower the banks' taxes to pay for this gift, then so long as we don't talk about where we make up the shortfall that it creates (or widens, in this case), then you're absolutely right! No one else's money comes into play!

So I'll rephrase: You can use your money to make up the shortfall...me, I'd like to pass. They've received quite enough gifts, IMO.



-=Vel=-

[Kidlicious]

Originally posted by Naked Gents Rut
No one's money is being used to encourage them. The banks are paying less in taxes, not receiving more in taxpayer funds.

The money is going to be borrowed to pay for this. Giving the banks a tax break is in effect, exactly the same thing as giving them a subsidy. Of course, the money has to come from somewhere else in the economy, which hurts all of us.

I'm not going to get up in arms about cutting taxes as an emergency measure during a financial crisis. There's nothing preventing Congress from reinstating the tax at a later date.

Congress didn't intend to make this cut. It was snuck into the deal as the framers terrorized us with their language of urgency.

[Naked Gents Rut]

Ahhh...so if we lower the banks' taxes to pay for this gift, then so long as we don't talk about where we make up the shortfall that it creates (or widens, in this case), then you're absolutely right! No one else's money comes into play!

So I'll rephrase: You can use your money to make up the shortfall...me, I'd like to pass. They've received quite enough gifts, IMO.

You need to read the article again (or for the first time). This wasn't a tax that the banks were going to pay out in the course of normal operations. It only applied in the case of mergers. The Treasury wanted to encourage mergers to rescue troubled banks, so, as an incentive, they got rid of a tax that made banks less likely to want to acquire another bank. Seems like a smart change and one that didn't take any money away from anyone.

[Kidlicious]

A particularly weak part of your argument is the assumption that banks don't want to take over their competitors, that they need to be encouraged to do that.

[Naked Gents Rut]

I doubt any bank felt like taking on much risk given recent conditions in the financial markets.

[Velociryx]

Amen.

And the fact that the money raised (whether or not the tax is levied against "normal operations" is still being raised for some purpose, and less expected revenue = revenue that has to be made up by raising a tax elsewhere.

But no matter...we can't let logic get in the way...

-=Vel=-

[Velociryx]

Originally posted by Naked Gents Rut
I doubt any bank felt like taking on much risk given recent conditions in the financial markets.

Why NOT!? Picking up a competitor for pennies on the dollar?

SWEET!

Even if I have to pay a toll, so what?!

That's why people buy low and sell high, after all.

The market at work, and all that jazz.

-=Vel=-

[Naked Gents Rut]

And the fact that the money raised (whether or not the tax is levied against "normal operations" is still being raised for some purpose, and less expected revenue = revenue that has to be made up by raising a tax elsewhere.

The tax revenue wasn't expected, unless you think the IRS can peer into the future and anticipate bank mergers.

Why NOT!? Picking up a competitor for pennies on the dollar?

You better be getting a very sweet deal in return for accepting the risk from all the bad paper on your newly purchased bank's balance sheet...

[snoopy369]

I'd love to know how it is that Treasury has the power to cut taxes...

[Velociryx]

Statistically, you can model an average of mergers across any industry and come up with a reasonable expectation of revenues received from such a tax.

If you don't believe such modelling takes place, then I have a wonderful tract of beachfront property to sell you in central Kansas...

-=Vel=-

[GePap]

Originally posted by snoopy369
I'd love to know how it is that Treasury has the power to cut taxes...

Duh! They are a part of the executive branch at a time of war and crisis. To try to stop the executive branch from doing whatever the hell is wants at this time is clearly anti-American and highly unpatriotic.

Shame on you, you terrorist lover!

[Naked Gents Rut]

Statistically, you can model an average of mergers across any industry and come up with a reasonable expectation of revenues received from such a tax.

I'm sure those models provided a very accurate estimate of expected tax revenue from bank mergers during the worst financial crisis since the Great Depression.

[Kidlicious]

Originally posted by Naked Gents Rut
I doubt any bank felt like taking on much risk given recent conditions in the financial markets.

Nonsense. This is the best time to take over your competitors. It's not easy to takeover a competitor when the economy is booming.

The only thing holding back takeovers is the lack of capital, and that is being provided for with the stated $700bn. The treasury is giving a priority to banks that are willing to takeover weaker competitors.

This is just simple corruption here, a way for big banks to get a free $100bn by pulling the wool over the eyes of the people and their Congress.

[Kidlicious]

Originally posted by snoopy369
I'd love to know how it is that Treasury has the power to cut taxes...

They don't. That's another issue.