President Proposes New Tax on Wall Street Banks

According to this story from the Associated Press, the Obama Administration is considering a new tax on those Wall Street banks which benefited from the taxpayer-funded, government-run Troubled Asset Relief Program (TARP). The goal of the proposed tax would be to recoop any money lost to the federal government as a result of expending TARP funds and to help balance the woefully-unbalanced federal budget.

This is good news, and 21st Century Jeffersonians should wholeheartedly support this proposal. It is only right and fair that these banks pay an additional tax after having been bailed out by the federal government. Furthermore, considering the fiscal crisis, this new bank tax would be a most welcome stream of additional revenue (although, truth be told, persuading the federal government to use the money for deficit reduction is likely to be an uphill battle).

In any case, Wall Street clearly needs to be reigned in, and an additional tax on these banks would be a welcome addition to any new regulations on their activities that may emerge from the current Congress. These people ruined the lives of millions of American citizens, and brought the country to the brink of total econoic collapse, merely to line their own pockets with obscene multi-million dollar bonuses. While millions of Americans were losing their jobs and homes because of the mismanagement and greed of Wall Street, the bank executives were popping open champagne bottles.

These banks only survived because they were bailed out by extremely reluctant American taxpayers. But even after that, we now see the Wall Street fat cats already back to their old tricks again, preparing to pay out billions of dollars in bonuses even before they have paid back the taxpayers. This is something that should outrage every American citizen.

Let's hope President Obama's bank tax proposal is successful, and that a serious financial regulation reform package can get through Congress. Thus far, Obama has been far too soft on the bankers, despite occasional populist rhetoric on the subject. It's high time for him to take the kid gloves off and crack down on them. In a truly just world, many of these investment bankers would be in jail. Slapping them with an additional tax, however, is a good place to start.