PENNSYLVANIA RECORD

White House Wants Bailout Tax
Financial Institutions Targeted
By Michael P. Tremoglie
The White House’s proposed “Financial Crisis Responsibility Fee”
(FCRF) would collect taxes from financial institutions “to pay the tab
of irresponsible firms, namely the auto companies, that still owe the
government billions,” according to a September 22 blog entry by John
Berlau on the Competitive Enterprise Institute website.
The White House claims that its fee is consistent with the congressional
intent of the TARP legisla­tion that “requires the President to propose a way
for the financial sector to pay back taxpay­ers so that not one penny of the
Government’s TARP­related debt is passed on to the next generation.” The
fee could be in place beyond 2021 if necessary. The structure of the fee is
consistent with G­20 Leaders principles and similar to fees proposed by
other countries. It is projected to reduce the deficit by $30 billion over 10
years.
“We also ask the largest financial firms — companies saved by tax dollars
during the financial crisis — to repay the American people for every dime
that we spent,” President Obama said Monday.
But the article notes that there is a provision that limits the fee to certain
firms. The proposal states the fee will be re­stricted to financial firms with
assets over $50 billion and will be imposed until all TARP costs have been
recouped.
“Although many of the largest financial firms have repaid the Treasury for
their TARP assistance, they continue to implicitly benefit from the TARP
funds that bolstered their balance sheets during a period of great economic
upheaval,” President Obama announced.
But as the Berlau article noted the fee is not on recipients of TARP as such,
but only on financial institutions with assets in excess of $50 billion. Fidelity
Investments would be an example of a financial firm that would be assessed
the fee although it never took TARP funds.
The Obama administration maintains that “shared responsibility requires
that the largest financial firms pay back the taxpayer for the extraordinary
support they received.” But there is no such requirement for companies
like General Motors and Chrysler that still owe billions to the American
taxpayer.
The administration has said that although the fee is extraordinary financial
institutions received extraordinary help from the American taxpayer.
White House Wants Bailout TaxFinancial Institutions TargetedBy Michael P. Tremoglie
The White House’s proposed “Financial Crisis Responsibility Fee”(FCRF) would collect taxes from financial institutions “to pay the tabof irresponsible firms, namely the auto companies, that still owe thegovernment billions,” according to a September 22 blog entry by JohnBerlau on the Competitive Enterprise Institute website.
The White House claims that its fee is consistent with the congressionalintent of the TARP legisla­tion that “requires the President to propose a wayfor the financial sector to pay back taxpay­ers so that not one penny of theGovernment’s TARP­related debt is passed on to the next generation.” Thefee could be in place beyond 2021 if necessary. The structure of the fee isconsistent with G­20 Leaders principles and similar to fees proposed byother countries. It is projected to reduce the deficit by $30 billion over 10years.
“We also ask the largest financial firms — companies saved by tax dollarsduring the financial crisis — to repay the American people for every dimethat we spent,” President Obama said Monday.
But the article notes that there is a provision that limits the fee to certainfirms. The proposal states the fee will be re­stricted to financial firms withassets over $50 billion and will be imposed until all TARP costs have beenrecouped.
“Although many of the largest financial firms have repaid the Treasury fortheir TARP assistance, they continue to implicitly benefit from the TARPfunds that bolstered their balance sheets during a period of great economicupheaval,” President Obama announced.
But as the Berlau article noted the fee is not on recipients of TARP as such,but only on financial institutions with assets in excess of $50 billion. FidelityInvestments would be an example of a financial firm that would be assessedthe fee although it never took TARP funds.
The Obama administration maintains that “shared responsibility requiresthat the largest financial firms pay back the taxpayer for the extraordinarysupport they received.” But there is no such requirement for companieslike General Motors and Chrysler that still owe billions to the Americantaxpayer.
The administration has said that although the fee is extraordinary financialinstitutions received extraordinary help from the American taxpayer.