Fausta’s Blog

Coming up next, since the economy is not in bad enough straits already, Obama’s populist assault on the finance industry, in the form of a “financial crisis responsibility fee”,
Obama’s Bank Tax Seeks $90 Billion to Repay Bailout

President Obama plans to call on Thursday for taxing about 50 big banks and major financial institutions for at least the next decade to recoup all taxpayer losses from the bailout of Wall Street.

The tax on banks, insurance companies and brokerages with more than $50 billion in assets would start after June 30 and seek to collect $90 billion over 10 years, according to a senior administration official who briefed reporters late Wednesday.

But the levy but would remain in force longer if all losses to the bailout fund, the Troubled Asset Relief Program, are not recovered after a decade.

This is to punish the financial institutions, even when,

the big banks have been objecting that taxpayers actually made money on the bailout loans. Many, including Goldman Sachs and JPMorgan Chase, have repaid their federal funds with interest and the government has also made money in selling the banks’ warrants that it held as collateral.

By the way,

The taxed firms are expected to pay the cost of bailout money that went to General Motors Co. and Chrysler LLC, which are exempt from the tax. The administration official defended the omission by contending that U.S. auto makers collapsed in part because of a financial crisis of the banks’ making.

Sweet for the unions – which are also exempt from the “cadillac tax” on high-cost medical benefit plans. It’s a deal,

The deal would temporarily exempt union health plans from a significant surtax on unusually generous health policies plans, giving union leaders time to negotiate new contracts, according to sources familiar with the talks.

Of course, Chris Dodd, Barney Franks, and Congress’ own Community Reinvestment Act (which is still law and will be expanded) had nothing to do with the financial crisis.

As it turns out,

House Financial Services Chairman Barney Frank “is mounting a new effort to limit executive compensation as Wall Street prepares this month to pay out huge bonuses.” Frank, “said he is looking at levying new taxes or fees on financial firms as well as ways to further empower shareholders to restrict pay.” Frank, “called a hearing for Jan. 22 and said he is not convinced by arguments that restrictions would hurt the industry by forcing well-paid employees to go elsewhere.”

Nice going, Barney.

How’s that for “financial crisis responsibility”?

Thomas Sowell explains what politicians are after when making disastrous policy:
Solving Whose Problem?

No one will really understand politics until they understand that politicians are not trying to solve our problems. They are trying to solve their own problems– of which getting elected and re-elected are number one and number two. Whatever is number three is far behind.

Dr Sowell looks at Barney Frank’s role in the mortgage crisis:

Very few people are likely to connect the dots back to those members of Congress who voted for bigger mortgage guarantees and bailouts by the FHA. So the Congressmen’s and the bureaucrats’ jobs are safe, even if millions of other people’s jobs are not.

Congressman Barney Frank is not about to cut back on risky mortgage loan guarantees by the FHA. He recently announced that he plans to introduce legislation to raise the limit on FHA loan guarantees even more.

Congressman Frank will make himself popular with people who get those loans and with banks that make these high-risk loans where they can pocket the profits and pass the risk on to the FHA.

So long as the taxpayers don’t understand that all this political generosity and compassion are at their expense, Barney Frank is an odds-on favorite to get re-elected. The man is not stupid.

What is stupid is believing that politicians are trying to solve our problems, instead of theirs.

While you’re at it, don’t bet on the Community Reinvestment Act to stop being law any time soon.

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And a side comment:
Townhall.com, where the Sowell article is posted, now has the most obnoxious, by far, website. As Gerard put it, it’s become a

crapulous example of graphic sludge, popovers, popunders, animations, blink tags and other web page bullshit gone wild

As if that weren’t enough, the RSS feeds are screwy, too.

If any of you guys in charge of that mess are reading this, I urge you to please clean up the mess.