Getting to a trillion - tax and bank news

Jared Bernstein, notes some ways to reduce government costs through reductions in loopholes. Despite Republican efforts to pretend otherwise, a tax loophole is a way of spending Federal money. When the Government gives Exxon a tax loophole, it means other business or individuals must either pay more taxes or live with the costs of government borrowing. And these loopholes cost a lot over 10 years:
  • $15,000,000,000 to allow hedge fund managers a specially low tax rate
  • $46,000,000,000 to protect fossil fuel producers from solar and wind power competitors.
  • $125,000,000,000 to tax stock dividend income at at only 15% instead of at the same rate as wages.
  • $60,000,000,000 to subsidize second homes!
It's worth reading the article to see what the President means when he talks about "tax expenditures" and to understand what the Republicans want to protect by making old people do without medicines. Thanks to the President's Deficit Commission, the GOP is having a hard time selling the story that ending corporate jet tax deductions is an oppressive tax hike. And while we are on the subject of the economy, a $8,500,000,000 payment by Bank of America and a $9,000,000,000 year cut in bank fees are interesting. Bank of America just agreed to pay investors back $8 1/2 billion for selling them shady mortgage backed bonds. They've already had to refund $3,000,000,000 to the government for selling junk to Fannie Mae/Freddie Mac and JP Morgan and Wells Fargo are facing similar problems. And the first Dodd-Frank bill rules have been posted - these will cut the fees charged by banks for processing debit card transactions in half.
(Reuters) - The crackdown on the financial industry's debit card "swipe" fees will cost large banks about $9.4 billion in annual revenues, the website estimated on Thursday. [...] Still, the law will roughly halve the fees that banks and card network companies like Visa Inc and MasterCard Inc now collect on debit card transactions. The Fed has said that the average debit "swipe" fee was 44 cents per transaction in 2009.
Consumer protection. To be fair, as the progressive critics of Dodd-Frank noted, America is still capitalist, there are many social and economic problems not solved by the bill, and the world is deeply unfair.

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