Obama Weighs Fee to Recoup Bank Bailout and Cut Deficit

This sounds like a good deal.

What's your opinion.

Source, New York Times

Full Article from NYT


WASHINGTON — President Obama is likely to propose a fee on financial institutions to help reduce the federal deficit when he releases his budget plans in February, although the details remain unresolved, according to administration officials.


The bank fee would recover some of the money that taxpayers put up to bail out the financial system after its near collapse in the fall of 2008, a rescue effort that has contributed to the largest annual budget deficits since World War II.



Ziggy Strange

Whenever the government imposes a fee or tax that isn't on the end user, don't businesses simply pass those fees/taxes along to the end user/consumer?

It kinda seems like bailout remorse and the people end up paying for it, again.

This is just going to be another Trickle down Tax.

There is only 1 source of Tax Payers, We The People.

really a double whammy on the taxpayers don't you think? Do you actually think banks would eat a fee imposed by the govt? This would no doubt be passed along as a fee to the consumers. Beyond stupid.

Originally posted by Wolf321
Whenever the government imposes a fee or tax that isn't on the end user, don't businesses simply pass those fees/taxes along to the end user/consumer?

It kinda seems like bailout remorse and the people end up paying for it, again.

Hi Wolf321,

Thank you for posting.

In my mind, after the bailout there should be an effort to recoup.

To be remorseful, you have to have done something you "wanted" to do. Not something you had to do to stop a complete immediate economic meltdown.

The only people that "wanted" a bailout were the elite. No bailout would have been disastrous for the people.

Let's see if when the fees are levied, there is no effort to mitigate the greed factor.

Regards

Ziggy Strange

In the UK, the Chancellor Alaister Darling has announced that there will be a tax on bank bonuses, the response of the banks so far is to strongly hint that if this goes ahead, then they will up sticks and move their business somewhere where they will not pay tax.
Quelle surprise!
And yet, if I go overdrawn for even a day, they raise technicolour hell to make me pay them much more than the overdrawn amount.
One rule for us, another for them, eh?

Ugg banks and money. Wish we could do without them both.

I'll have to reserve judgement on this until I see what happens. Nothing I can do about it anyways.

That said I can't see the banks taking this lightly or not finding someway to pass it off. Maybe I am just cynical but I really don't trust the institution of banking.

As a hypothetical: how could the banks pass this tax off onto us?

Cheers

reply to post by ziggystrange


You are right, they should have recouped soon after.

I don't know if I agree that we had to do what we did. I think at best, we could have done a little something to make the situation less disastrous, but they should have been allowed to fail. I think that a no or ultra low bail out would have been hard, but I honestly think having done it is and will be far worse on the people in the long run.

If you look at what money was used from what was appropriated, then we estimated way higher than what was utilized, and what we used was probably more than needed to get by.

Originally posted by royspeed
In the UK, the Chancellor Alaister Darling has announced that there will be a tax on bank bonuses, the response of the banks so far is to strongly hint that if this goes ahead, then they will up sticks and move their business somewhere where they will not pay tax.
Quelle surprise!
And yet, if I go overdrawn for even a day, they raise technicolour hell to make me pay them much more than the overdrawn amount.
One rule for us, another for them, eh?

Hi Royspeed,

Thanks for posting.

I made this thread to explore the possibilities as well as to see, what if anything is done.

Banks here not only hinted but said it. I'm an Obama supporter, but I'm not wearing blinders.

I'm ready to be an Obama detractor, as soon as he betrays my trust.

I don't think he will. In another thread, someone asked where is the change Obama promised.

I listed numerous things. Nobody rebutted my claims?

I think Obama deserves a chance to do what he said he would.
He's up against a world of opposition, it's a miracle he's been able to accomplish anything.

He was elected fair and square. I say give him his chance to succeed.

Regards

Ziggy Strange

It seems everyone has this one handled.

Since Geithner was mentioned in the article, when will he be asked about the AIG debacle that has come out recently?

As for the banks ever paying back the US taxpayer. I am almost laughing about that part of the question.

We are not even allowed to know where the funds went, so how the heck are they going to pay us back?

That is one big question there, ay?

Audit the fed, audit the government, audit every politician for the last 35 years. That may make me happy, maybe not.

Originally posted by mapsurfer_
really a double whammy on the taxpayers don't you think? Do you actually think banks would eat a fee imposed by the govt? This would no doubt be passed along as a fee to the consumers. Beyond stupid.

Hi mapsurfer,

Thank you for posting.

I agree it would be stupid to do it and not curtail the Banks ability to pass it on.

I think we will not be disappointed.

The fat lady has not sung yet.

Regards

Ziggy Strange

Originally posted by endisnighe
It seems everyone has this one handled.

Since Geithner was mentioned in the article, when will he be asked about the AIG debacle that has come out recently?

As for the banks ever paying back the US taxpayer. I am almost laughing about that part of the question.

We are not even allowed to know where the funds went, so how the heck are they going to pay us back?

That is one big question there, ay?

Audit the fed, audit the government, audit every politician for the last 35 years. That may make me happy, maybe not.

Hi Endisnighe,

Thanks for coming and posting.

So far it's a consensus that it's a bad idea, or will end badly.

I'm glad to see it being proposed. There has been recovery from several Banks, unless it's a lie and nobody called Obama on it.

I don't like getting ripped off either.

Regards

Ziggy

Originally posted by Wolf321
reply to post by ziggystrange

 

You are right, they should have recouped soon after.

I don't know if I agree that we had to do what we did. I think at best, we could have done a little something to make the situation less disastrous, but they should have been allowed to fail. I think that a no or ultra low bail out would have been hard, but I honestly think having done it is and will be far worse on the people in the long run.

If you look at what money was used from what was appropriated, then we estimated way higher than what was utilized, and what we used was probably more than needed to get by.

Hi Wolf321,

I respect your position, and thank you for the rational responses.

I agree we gave them too much.

I spent years working as a consultant for one of the bailout banks, it was disgusting.

They are thieves. All the big corps are the same. I don't trust any of them, and I believe a lot of reform is needed.

Regards,

Ziggy Strange

The fees, if imposed on banks that took bailout money will just be passed onto their end users. If government tries to regulate such a move, the banks will raise fees in other areas that are unrelated to the imposed regulations. These banks are conglomerates and will just raise prices/fees elsewhere to obtain the money somewhere.....thus which happens with haphazard policies and regulations.

They will find a way to recoup any money that the government demands back from them.

Ziggy- I am not wholly sold on that the people would have been in a more disastrous position if some of the banks (not all) but some of them were to be allowed to fail.

Basically you are saying the outcome of a path is known on speculation when it was never tried. Right now, with bailouts (both Bushy and Obamie) have made everyone in the present, so to speak feel a bit better while selling out others down the road with huge governmental debt while not actually resolving the problem.

These banks do not care if the government has their hand in their cookie-jar because they are still afloat, still doing business as they always have, while the U.S. Government assumes the risk.

Hell, if I were a business owner and as all business owners know, there is an element of risk. Allowing a small part of my business to be 'handled' by the government while it takes 100% of the risk is a huge payoff.....especially to these mega-corporations.

reply to post by ownbestenemy


Hi Ownbestenemy,

Thanks for dropping in.

O - Ziggy- I am not wholly sold on that the people would have been in a more disastrous position if some of the banks (not all) but some of them were to be allowed to fail.

Z - Fair enough, I think some should fail also. But I respectfully disagree as to the need to bail out. But I hated it being done.

O - Basically you are saying the outcome of a path is known on speculation when it was never tried. Right now, with bailouts (both Bushy and Obamie) have made everyone in the present, so to speak feel a bit better while selling out others down the road with huge governmental debt while not actually resolving the problem. These banks do not care

Z - If that was for me, No I'm saying that to not attempt to recover is worse than to attempt it. I'm withholding judgment until I see something concrete. We disagree on ideology and policy, but that does not mean we don't want some similar things. Anyone that was "for" the bailout is either idiotic or complicit. I know a little bit about economics, and so far I don't see a failure.
I see a slow recovery well under way. But that's me. I have debated with you before, and I respect your opinion.

Thanks OBE (is it ok to call you OBE)

Ziggy

reply to post by ziggystrange


Ziggy-

Of course it okay...I have a long handle and most just abbreviate. It isn't my name so I have no care in regards to that.

I am glad that we got all the angst remarks out of the way in the previous threads and have come to be able to discuss from different views. I know I have at least incorporated what you have said into my thinking. No sway of opinion, but you are part of my logic check. Thank you.

Anyone that was "for" the bailout is either idiotic or complicit. I know a little bit about economics, and so far I don't see a failure.

I agree that people for it are either of those two things. The problem is, and this isn't a slight on you, because I fall under this category also, is the little knowledge of economics that as a general populace we have.

I am also in agreement that not to do anything at all would be worse, but allowing a business to fail because of flawed practices (nefarious or not) doesn't mean nothing was done, as that is the nature of a free-market. Some fail, some succeed. Those with sound business practices that are not cutting corners, 'persuading' the government to provide a comfy environment (as in the massive lobbying done to stifle competition), and balanced books will have a higher chance of meeting the needs of their market. Whereas these banks are being rewarded in a way of having all those pitfalls I just listed and still operate in a manner that isn't much different than it was pre-bailout.

Another aspect of this all is the president set of the bail-outs. Not a slippery-slope argument, but rather one of where big companies like this always keeping in the back of their minds that if they are failing, they can always go to the government and make a case that they are 'too big to fail'.

Truly nothing has been fixed, except now instead of the free-market providing the capital, the Federal Government is now providing the capital for these companies. That alone should be enough to be scared of. If private investors do not see it as a viable option, the government should not either.

I understand we have different views on this, but I do not see a recovery on the way.

Look at the late 90s when the dot.com bubble burst. There were a lot of companies and start-ups that tanked and A LOT of people lost all their wealth in these. Where was the outrage to prop these companies up? Why didn't the government step in and make sure they were able to stay afloat?

The entrepreneurs of that era either conceded defeat and went back to work or they matured their businesses and business models to fit what the market wants. All without the government stepping in and trying to 'fix' the situation.

I will say though and I really think this is part of the problem is, a bubble like the dot.com one, the government wasn't dipping their hands into that market (at least not in the way they were in the financial institutions); whereas financial institutions and the housing market has Federal fingerprints all over the place.

The government already had a vested interest in the banks as they were trying to use it as a social engineering tool. When that failed, just as all government projects, they don't want to abandon; rather they wish to throw more money at it.

Originally posted by ownbestenemy
reply to post by ziggystrange

 

Ziggy-

O - Of course it okay...I have a long handle and most just abbreviate. It isn't my name so I have no care in regards to that.

Z - Thanks OBE, I just lost my response long winded response by hitting the wrong key, back at you soon as I write a new one. It was a story of corruption I have seen in gov, and a major Bank, and some food for thought.

Back ASAP. Not spitting fire at you, I told you, I think you are one of the good guys. You convinced "me" of something! Not ideology, but about discernment.

Ziggy

reply to post by lucien999


If you need to get your 20 posts done, why not provide something useful to the conversation rather than take up space by just saying something like "I need to get these 20 done".

What you are doing is setting a standard that you will not offer anything constructive towards a conversation, but you want to post threads in attempts to what? You probably won't be back to even read this.

reply to post by ownbestenemy


Hi OBE,

I'm coming back to you. I know I owe you 2.
We're going to talk without the BS and insults.

I'm beat, tired, got a bunch of work that I have to do.
I find your conversation actually helps me understand what I'll call ideology I can talk to. We don't disagree on everything, it will be interesting to debate the ideas.

Apologies

Ziggy