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Editorials Across the Nation Voice Opposition to President Obama’s “Incoherent” Bank Plan |
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“Levying an across-the-board tax will only increase costs for all banks and raise prices for customers.” |
Los Angeles Times Editorial: "President Obama seems so rattled by Republican Scott Brown's victory in the Massachusetts Senate race that he's scrambling to reestablish his bona fides with The Little People. Last week he picked another fight with big banks, calling for new limits on their size and business ventures. In his weekend radio address, he bashed the Supreme Court for handing ‘a huge victory to the special interests and their lobbyists' by eliminating some limits on corporate and union electioneering. And on Monday, he outlined a proposal to provide larger tax cuts and subsidies for middle-class families. Although some of these proposals address real problems, the populist tone struck by Obama and his aides made their efforts seem like pandering." (January 26, 2010)
Washington Times Editorial: "The truth is most of the blame for the financial meltdown belongs to government. Some banks were forced to take government bailout funds under government threat. Others, such as Bank of America, found themselves in financial difficulty because the government forced them to merge with other institutions that had lost oodles of money. Each situation is unique; if there is going to be a bank tax, it makes no sense to tax the disparate institutions equally. Even under Mr. Obama's own anti-business logic - that new taxes and regulations are needed to control risk in the banking sector - it would only make sense to impose a tax on riskier banks. Levying an across-the-board tax will only increase costs for all banks and raise prices for customers." (January 25, 2010)
Kansas City Star Editorial: "If President Barack Obama's plan is to keep the banks off balance, he's doing a good job. In recent days, the White House has lobbed three major proposals at the financial sector...He wants curbs on the size of institutions, but establishing a ‘right' size isn't traditionally the federal government's role. Size wasn't necessarily a problem in the crisis. Bear Stearns wasn't a bank, and it wasn't especially large, but it was bailed out by the feds. Obama also wants a special tax on big banks, or a ‘financial crisis responsibility fee' - a levy quickly dubbed the ‘financial sin tax' by Wall Streeters...It would likely be passed on to consumers. It could curb lending, since banks fund lending out of liabilities. It could encourage institutions to move some activities to the kind of off-balance-sheet entities that were part of the original problem." (January 25, 2010)
The Detroit News Editorial: "The urge to gain political capital by pandering to the public's ire with bankers carries real risks to the economic recovery. A proposed $90 billion tax on banks will reduce their incentives to lend -- and slow the economic growth that leads to jobs. The tax, touted again by President Barack Obama this week, was accompanied by hard rhetoric from the president: ‘We want our money back, and we're going to get it.'...The proposed bank tax is at war with the rest of the Obama administration's policy to make credit more easily available. David Littmann, a retired bank economist now with the Mackinac Center for Public Policy, said regional banks on the cusp of growing to $50 billion in assets could be motivated to stay under the limit to avoid the tax. That means they would make fewer loans. That's not what the economy needs right now." (January 25, 2010)
Wall Street Journal Editorial: "The White House has spent months imploring banks to lend more money, so will President Obama's new proposal to extract $117 billion from bank capital encourage new bank lending? Just asking. Welcome to one more installment in Washington's year-long crusade to revive private business by assailing and soaking it. Mr. Obama's new ‘Financial Crisis Responsibility Fee'-please don't call it a tax-is being sold as a way to cover expected losses in the Troubled Asset Relief Program. That sounds reasonable, except that the banks designated to pay the fee aren't those responsible for the losses. With the exception of Citigroup, those banks have repaid their TARP money with interest." (January 16, 2010)
Boston Herald Editorial: "President Obama's proposed tax on large banks to ‘recover every single dime' of federal bailout money would do nothing that couldn't be done in a simpler way. The president's proposal to let regulators limit the size of banks and a companion proposal to forbid deposit-taking institutions from trading for their own accounts are far better ideas...If meant as additional punishment of institutions that caused the financial crisis, as the president sometimes has implied, it is incoherent." (January 24, 2010)
New York Daily News Editorial: "New York's two most important economic engines are health care and finance - and President Obama seems determined to take a wrecking ball to both of them... And now, even more threatening, the President has called for imposing a heavy tax on America's biggest banks, whose health and profitability are crucial to New York's well-being. Obama is peddling the bank tax as a way for the public to recoup money from the financial houses that were rescued in the big bailout - never mind that many of them have repaid their loans with generous interest. Actually, he is a President in desperate search for cash and exploiting popular anger at Wall Street's continuing excess to grab same. This is taxation as revenge, not as sound economic policy." (January 19, 2010)
Philadelphia Inquirer Editorial: "President Obama's proposal to tax bailed-out banks offers taxpayers a momentary thrill of retribution, but it's not likely to change Wall Street's risky behavior. The fees would be imposed on about 50 of the largest banks, based on their liabilities. Among the targets are Goldman Sachs, Bank of America Corp., and Citigroup Inc. - firms with assets of more than $50 billion... But the administration's proposal for a broad tax on banks is flawed because it aims mainly at public perception rather than policy. ‘The perception has been we weren't tough enough' on Wall Street, said Sen. Bob Casey (D., Pa.), who generally supports the president's plan. ‘It helps in terms of that perception.' That's a diplomatic way of saying that this idea is more about scoring political points in an election year, rather than compelling Wall Street to change its ways." (January 17, 2010)