The CBO estimated that the financial reform bill will cost $22 billion over 10 years. So how does the conference bill pay for it?
Part of that will be paid for by the Securities and Exchange Commission. The remainder, between $15 billion and $19 billion, be paid for by a tax on the financial industry. The Federal Deposit Insurance Corporation will assess financial institutions with assets exceeding $50 billion and hedge funds with assets exceeding $10 billion over five years to cover the costs.And of course, we find out that Scott Brown is not the Tea Party's candidate at all. He is Wall Street's Senator. He is looking out for the real aggrieved party in our economy, the big banks and hedge funds.
"This tax was not in the Senate version of the bill, which I supported," he said in a letter today to Senate Committee on Banking Chairman Chris Dodd and House Committee on Financial Resources Chairman Barney Frank. "If the final version of this bill contains these higher taxes, I will not support it."But apparently, he is not the only one. Republicans Snowe, Collins and Grassley have also expressed concerns over the bank fee.
Oh, no! Banks and financial institutions with more than $50 billion in assets and Hedge Funds with over $10 billion in assets will be charged for the cost of financial reform! The poor, poor banks and hedge funds. How are they going to eat? Will no one think of the banks and the hedge funds? I mean it's not like it was the giant financial institutions that were at fault for breaking our entire financial system or anything. It's not as though we should make guilty party pay for some of the fixes. Right, Sen. Brown?
Call Sen. Brown and demand he stop supporting the banks over the taxpayers! 202-224-4543.
This is silliness. This is insane. This should be eye-opening for anyone not on the fringe right wing of our country: The Republican Party is a wholly owned subsidiary of Wall Street. In 2008, commercial banks in this country alone owned over $13 trillion in assets. They screwed up our entire financial system, nearly put our economy into a great depression, and upended the lives of millions of Americans. And now, Scott Brown and other Republicans are looking out for their interests, not ours.
But the trouble isn't only coming from Republicans. Two Democrats - Sens. Russ Feingold and Maria Cantwell opposed the Senate bill on the grounds that it wasn't strong enough. Late word is that Cantwell has agreed to support the conference report.
Frank said this afternoon that he's been told by Dodd that Cantwell, Collins and Snowe have all said that they will support the conference report.Feingold has reiterated his opposition due to the fact that regulators were not given the authority to break up banks if they get "too big to fail." While a strong authority to break up banks is in fact in the Senate bill, it does contain provisions granting the FDIC resolution authority against bank holding companies and non-bank financial companies when they threaten the stability of the financial system.
If true, that leaves Democrats just one more vote to secure for cloture -- and thus the fate of the bill could come down to Brown and whether a change to the bank fee situation will win him back.
I understand Sen. Feingold's concerns and fully sympathize. However, this is overall a strong bill that creates a strong consumer protection bureau, reins in derivatives trading and institutes a ban on proprietary trading (Volcker rule - although it allows banks to invest 3% of their "Tier 1 Capital" in risky hedge funds, it prevents the most egregious forms of Russian Roulette). This is a bill worth passing. Not only that, by refusing to support the conference report, Sen. Feingold puts the fate of this bill in the hands of Scott Brown and Republicans who want to weaken even the reform it has now.
Here are the alternatives Democrats are now forced to consider because of Brown's powerful position as the deciding vote on this:
Two alternatives being discussed to generate the money, according to CBS News Capitol Hill Producer Jill Jackson, are to raise the Federal Deposit Insurance Corporation premium ratio and, perhaps more significantly, to eliminate the TARP program except for existing obligations.Eliminating the TARP program except for existing obligations will not have any impact on the banking sector, since TARP has already been less costly and more successful than anyone thought, with the most recent cost estimate being a little over $100 billion (as opposed to the $700 billion put at risk). However, remember that TARP money is taxpayer money. Using TARP money to fund financial regulatory reform would make taxpayers foot even more of the bill than they already have for a calamity caused by the big banks. Raising the FDIC premium ratio would force FDIC to fund the entire bill, and since FDIC is funded by tax dollars, it would also put the cost ultimately on taxpayers. What the Republicans are looking for is exactly that - to have the taxpayers, not Wall Street, bear the cost. If we want banks to pay even partially for the disaster they have caused, we can bypass Scott Brown if Sen. Feingold will agree to support the bill.
Please ask Sen. Feingold to support the conference report so we can get the banks to pay for at least some of the cost of reform, and take away Scott Brown's power to hold taxpayers hostage. 202-224-5323.
The Republican party is showing us who they are. They are showing us on whose side they stand. They stand with Wall Street, they stand with big banks, and they stand with the moneyed interests. They stand against ordinary Americans. Despite their talks about American exceptionalism, they want to turn this country into a third world country without a middle class. The Republican leadership in this country is anti-American, anti-middle class, and pro-corporate. There is simply no other way to put it. And that is why we must be united in our fight against the GOP's greed, their benefactors and their agenda.