Jan 19 2010
Brad Miller: Taxing ‘Too Big to Fail’ and Republican Hypocrisy
Congressman Brad Miller (D-NC-13) wrote a column for the Huffington Post over the weekend in which he referred to the Republicans in Congress as hypocrites for opposing Obama’s tax on “too big to fail” banks because they posed a similar plan just a few years ago. Well, that may be true and they probably are hypocrites. I have met very few politicians who aren’t, but hypocritical or not, this tax should not be implemented and that’s the bigger picture Miller isn’t seeing through his partisan eye glasses. He quotes a 2000 testimony by Stephen Moore of the CATO Institute.
“The user fee is a partial payment for the implicit guarantee it receives from Uncle Sam,” Moore said. “The rationale behind such a fee is that since taxpayers are bearing an implicit risk on Fannie Mae activities, it is reasonable that the federal government recoup fees to pay for that assumption of risk. The main advantage of such a fee is that it would help level the playing field between Fannie Mae and its fully private competitors.”
What I am reading there amounts to double taxation on you and me. First of all, Moore is right about Fannie and Freddie. We, the taxpayers, are bearing a huge risk on backing their overly risky and poor business activities. We are already being taxed to pay for their recklessness. The question that should be asked here is why? Why is the government continuing to take responsibility for Fannie and Freddie with our tax dollars? That’s what should be addressed. Miller also notes that the tax will go to help reclaim $120 billion in tax dollars that were lost through the TARP program. Again, it begs the question, why was it done in the first place? Adding a 15% tax on all banks to cover this stupidity is what amounts to the second round of taxation on people like you and me because as Congressman Miller and many in the Democrat party don’t seem to understand, businesses don’t pay taxes. They pass their tax burden on to us through increased fees and prices and we pay for it when we patron them so I don’t see how Obama’s bank tax is good for anybody other than the power brokers in D.C. steering our nation into the crapper.
