The $140 billion Henry Paulson forgot to tell us about - 2008-11-13
Apparently, $700 billion just isn't enough. Some of the banks who are buying up failing banks are also getting big tax breaks. How big?
The tax break that Wells Fargo will get as a result of its acquistion of Wachovia Corp. is $20 billion. That's $5.2 billion more than the $14.8 billion it cost Wells Fargo to make the acquisition.
How did we, the American taxpayers, not know this was part of the bailout deal? Maybe, in part, because Congress did not know about it either.
In September, the Treasury Department quickly and quietly submitted a tax policy change in the midst of debates over the bailout plan. There was no Congressional debate and an estimate of the cost of this policy was never released to the public. But unofficial estimates are putting the total that banks stand to gain from this at $140 billion.
Now, many tax attorneys are questioning the legality of the policy , and many representatives in Congress are expressing their concern about the implications.
For all the uncertainty about this policy, one thing is clear -- it is exactly what we were afraid of. Instead of careful monitoring and accountability on this bailout, we have tax policies getting slipped in under the radar which line the pockets of mega banks and leave taxpayers holding the bag.
Rep. Barney Frank is the chair of the Financial Services Committee, and he is responsible for oversight on this bailout. Tell him today to put a stop to these sneaky policies.
