Obama to big banks: 'We want our money back'

[AnselmosSyringe]

NEW YORK (CNNMoney.com) -- President Obama on Thursday called on Congress to tax the largest banks to ensure that U.S. taxpayers don't lose a penny from the federal bailout of the financial, auto and insurance industries over the past year.

The "financial crisis responsibility fee" would target major institutions. It would be levied on those that were the main contributors to the financial crisis and the most significant beneficiaries of the extraordinary actions taken by the Federal Reserve and the Treasury Department.

"My commitment is to recover every single dime the American people are owed," Obama said. "We want our money back and we're going to get it."

Full details of how the measure would work will be part of Obama's proposed 2011 budget, which won't be released until early next month.

But the president's announcement comes as banks are set to pay out tens of billions of dollars in bonuses.

Obama noted that Treasury has already recovered the majority of the funds provided to banks, but said that wasn't good enough.

"If these companies are in good enough shape to afford massive bonuses, they are surely in good enough shape to afford paying back every penny to taxpayers," Obama said.

His proposal comes a full three years before the law that created the $700 billion Troubled Asset Relief Program would require the president to submit a legislative proposal to Congress to recoup any money lost from the bailouts.

The president's proposal calls for the tax to be in place for a minimum of 10 years, but longer if necessary. "The fee will stay in place until every penny of TARP is repaid," a senior administration official said.

If passed by Congress, it would take effect on June 30 and is estimated to raise $90 billion over 10 years. More than 60% of the money is likely to come from the 10 largest financial institutions.

Firms could be subject to the fee even if they never took TARP funds or if they took TARP funds but repaid them. That's because all major financial institutions benefited directly and indirectly from the efforts to stabilize the financial system, according to the administration.

If the fee ends up raising more money than is needed to fully repay the bailout money, the additional funds would be used to help improve the U.S. fiscal position, which was worsened by the crisis, the senior administration official said.

A group representing 100 financial services companies wasted no time in blasting the proposal.

"Two-thirds of the TARP investment from banks has already been repaid with a large profit to the taxpayer," said Steve Bartlett, president of the Financial Roundtable. "This proposed tax will do nothing more than stifle economic recovery and encumber more pressing concerns, such as covering new regulatory costs."

Obama bluntly said that banks should tap their bonus pools to pay the fee.

"I'd urge you to cover the costs of the rescue not by sticking it to your shareholders or your customers or fellow citizens with the bill, but by rolling back bonuses for top earners and executives," he said.

Firms subject to the fee would have to have more than $50 billion in assets and must be a bank holding company, a thrift holding company, an insurer or a broker-dealer. Smaller firms and community banks would not be affected, the official said.

[bane]

That idea is chock full of awesome.

[VinnieKulick]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

[bane]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

"Obama bluntly said that banks should tap their bonus pools to pay the fee"

[JakeYonkel]

OK, now get all the money that went to AIG and the car industry and we'll be all squared away.

[VinnieKulick]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

"Obama bluntly said that banks should tap their bonus pools to pay the fee"

Banks SHOULD. That doesn't mean it will happen. And if you think a bank is going to just take a LOSS, instead of making the money up in the forms of fees, you're crazy.

[TravisBickelsMohawk]

Remember that crack-down on credit card companies?

You got fees out of the ass and jacked-up interest rates for that one.

[pooldude]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

Vinnie, you're a true partisan.

You just can't bring yourself to give Mr Obama credit for anything that might be even remotely beneficial to the average American.

If Mr Obama had said "give more tax breaks to banks, they deserve it"...you'd be bitching, just the same.

[AnselmosSyringe]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

Vinnie, you're a true partisan.

You just can't bring yourself to give Mr Obama credit for anything that might be even remotely beneficial to the average American.

If Mr Obama had said "give more tax breaks to banks, they deserve it"...you'd be bitching, just the same.

No shit.

[VinnieKulick]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

Vinnie, you're a true partisan.

You just can't bring yourself to give Mr Obama credit for anything that might be even remotely beneficial to the average American.

If Mr Obama had said "give more tax breaks to banks, they deserve it"...you'd be bitching, just the same.

And, what exact party am I partisan for?
I want LESS GOVERNMENT INTRUSION in my life.
I want the government to stop doing things that will effect my daily life.

If you honestly think that this is a GOOD thing, more power to you. But tell me ONE instance where the government imposed a tax, or a fee, and it didn't end up costing the CONSUMER. (consumers are from every side of the political spectrum).

This will hurt individuals, plain and simple.
I won't say he did something good, when it ISN'T something good.

[pooldude]

Vinnie, you're a true partisan.

You just can't bring yourself to give Mr Obama credit for anything that might be even remotely beneficial to the average American.

If Mr Obama had said "give more tax breaks to banks, they deserve it"...you'd be bitching, just the same.

And, what exact party am I partisan for?
I want LESS GOVERNMENT INTRUSION in my life.
I want the government to stop doing things that will effect my daily life.

If you honestly think that this is a GOOD thing, more power to you. But tell me ONE instance where the government imposed a tax, or a fee, and it didn't end up costing the CONSUMER. (consumers are from every side of the political spectrum).

This will hurt individuals, plain and simple.
I won't say he did something good, when it ISN'T something good.

I get it.

You want the President to do nothing...either way, pro or con, up or down, backwards or forwards.

Nada.

Wherever the winds of unfettered & unregulated capitalism blow us...that's good enough for Vinnie.

Even if we end up on the rocks.

[VinnieKulick]

Take the time to make a personal insult to me.

Okay, that being done, name one example where the government put a tax or fee on an industry, and it DID NOT effect the consumer.

[pooldude]

^^^ If you take my comments as a personal insult, then you're very thin skinned.

The fact remains, you continue to find fault with Mr Obama no matter which direction he goes.

I think you're confused, & probably just as equally hurting in this negative economy as many of us, but you're misdirecting your anger.

In this thread, you're standing up for the big bankers, not the average American taxpayer.

[ROADHEAD]

That idea is chock full of awesome.

Unless you use one of the big banks, who will pass the 'fees' on to you.

Vinnie, you're a true partisan.

You just can't bring yourself to give Mr Obama credit for anything that might be even remotely beneficial to the average American.

If Mr Obama had said "give more tax breaks to banks, they deserve it"...you'd be bitching, just the same.

Don't bother addressing the whole 'passing the fees on to YOU' thing...

[pooldude]

Don't bother addressing the whole 'passing the fees on to YOU' thing...

If the Dems were to try to pass a law prohibiting the passing along of these hypothetical unfair banking fees...

...you & Vinnie & Sarah Palin would surely be among the 1st complaining about "socialist government interfering with unfettered free enterprise".

You betcha.

[VinnieKulick]

Don't bother addressing the whole 'passing the fees on to YOU' thing...

If the Dems were to try to pass a law prohibiting the passing along of these hypothetical unfair banking fees...

...you & Vinnie & Sarah Palin would surely be among the 1st complaining about "socialist government interfering with unfettered free enterprise".

You betcha.

Jesus on a pogostick. Stereotype much?

When Obama does something good, I will point it out. He's correct to refocus on Afghanistan. He's correct on keeping Robert Gates as Sect of Defense, he's correct in donating money and military resources to Haiti.


He's fucking dead wrong with wanting to impose a fee on the banks that he lent money to, because it will cost CUSTOMERS and not the BANKS.
Why is that so fucking hard to figure out?

[pooldude]

He's fucking dead wrong with wanting to impose a fee on the banks that he lent money to, because it will cost CUSTOMERS and not the BANKS.
Why is that so fucking hard to figure out?

The TARP program was implemented in March of 2008, to stabilize financial institutions in meltdown.

http://en.wikipedia.org/wiki/Troubled_A ... ef_Program

Mr Obama didn't take over the Presidency until Jan 2009.

He didn't cause that meltdown, or the ensuing recession.

You're misdirecting your anger, Vinnie.

[VinnieKulick]

How does TARP being given out before he's president effect HIM wanting to impose a penalty on the banks, that WILL be passed onto consumers?

[pooldude]

How does TARP being given out before he's president effect HIM wanting to impose a penalty on the banks, that WILL be passed onto consumers?

Why don't you read the article that was posted @ the top of the thread, Vinnie?

Evidently you didn't, because it answers the very questions you ask.

Your anger is misdirected, & you're basing it on suppositions that have yet to happen.

[VinnieKulick]

If you honestly think that this is a GOOD thing, more power to you. But tell me ONE instance where the government imposed a tax, or a fee, and it didn't end up costing the CONSUMER. (consumers are from every side of the political spectrum).

Clinton's 93 tax hike. Moving towards a balanced budget lowered the interest rate on 30 year treasuries from 8.5% to 6%. Banks had been reluctant to lend money after the S&L crisis and had purchased billions of treasuries. When rates fell, the treasuries purchased at 8.5% became more valuable and bank's balance sheets dramatically improved. This encouraged them to lend money again. As credit started to flow, millions of jobs were created and unemployment finally started to fall after several years of sluggish economic growth. It's the one instance when a tax hike led to economic growth.

You asked for ONE. You got ONE. Now STFU.

Banks investing at 8.5, and then making money on it, isn't the government imposing a fee on them. Nowhere close.

[VinnieKulick]

How does TARP being given out before he's president effect HIM wanting to impose a penalty on the banks, that WILL be passed onto consumers?

Why don't you read the article that was posted @ the top of the thread, Vinnie?

Evidently you didn't, because it answers the very questions you ask.

Your anger is misdirected, & you're basing it on suppositions that have yet to happen.

Yes, I read it. other than Obama saying the money SHOULD come from the bonuses, there is nothing that says a word about where it comes from.

Look at it this way, if gas is going for $1.00 a gallon and your state says there is going to be a ten cent tax per gallon on gas, is your gas still going to cost a buck? Or will it go to $1.10?

Banks, gas stations, liquor stores, and the like NEVER let a tax take away from their bottom line. It gets passed on to the consumer.

[pooldude]

Vinnie, you didn't like the government bailing out financial institutions when they were failing, even tho it meant the possibility of the complete collapse of our economy.

And now you're complaining when the administration insists those same institutions have to repay the loans in full.

You're quite a guy.

Truly, I stand on opposite sides of the political spectrum from you.

[VinnieKulick]

Vinnie, you didn't like the government bailing out financial institutions when they were failing, even tho it meant the possibility of the complete collapse of our economy.

And now you're complaining when the administration insists those same institutions have to repay the loans in full.

You're quite a guy.

Truly, I stand on opposite sides of the political spectrum from you.

I didn't like the government using tax dollars to support failing businesses. There are plenty of solvent banks in the world who could have lent the money.
Hell, the banks could have sold bonds to the chinese just as easy as the Obama administration did, and leave the tax payer out of it.

And, I am not complaining that they want to recoup the tax payer money, I am complaining that they want to impose a PENALTY/FEE if they are paying bonus money to people with binding legal contracts. Fees that will go to every person who uses the bank, and NOT the bank's bottom line.

If you honestly can't see that a fee will be passed to the consumer, something's wrong with you.

[absolutely fabulous]

why, the 20 million in interest already received, you were planning to redistribute to jobs wasn't enough?

find another thing(s) you need money for and that's why you're calling this in with penalties?

just wondering..