Shocking Report On Bank Ripoff Lead By Paulson

[Trojan]

http://www.washingtonpost.com/wp-dyn/content/article/2008/11/09/AR2008110902155.html?wpisrc=newsletter

Snippet:

A Quiet Windfall For U.S. Banks
With Attention on Bailout Debate, Treasury Made Change to Tax Policy




By Amit R. Paley
Washington Post Staff Writer
Monday, November 10, 2008; Page A01

The financial world was fixated on Capitol Hill as Congress battled over the Bush administration's request for a $700 billion bailout of the banking industry. In the midst of this late-September drama, the Treasury Department issued a five-sentence notice that attracted almost no public attention.

But corporate tax lawyers quickly realized the enormous implications of the document: Administration officials had just given American banks a windfall of as much as $140 billion.

The sweeping change to two decades of tax policy escaped the notice of lawmakers for several days, as they remained consumed with the controversial bailout bill. When they found out, some legislators were furious. Some congressional staff members have privately concluded that the notice was illegal. But they have worried that saying so publicly could unravel several recent bank mergers made possible by the change and send the economy into an even deeper tailspin.


"Did the Treasury Department have the authority to do this? I think almost every tax expert would agree that the answer is no," said George K. Yin, the former chief of staff of the Joint Committee on Taxation, the nonpartisan congressional authority on taxes. "They basically repealed a 22-year-old law that Congress passed as a backdoor way of providing aid to banks."

[GoesTo11]

1. This is appalling

K&R

[ccinamon]

2. I'm not the smartest cookie in the jar,

and I tried to the read the article,,,,but without knowing what the '5 sentence ruling' actually was, I had a very hard time following the article...it turned into a he said, she said type of thing which confuses me easily.

What WAS the 5 sentence ruling?

[Trojan]

3. Here Is A Explanation !

Paulson DID IT ON HIS OWN !

See Below Snippet:

Yet lobbyists trying to modify the obscure section found that they could get no traction in Congress or with the Treasury.

"It's really been the third rail of tax policy to touch 382," said Kevin A. Hassett, director of economic policy studies at the American Enterprise Institute.

'The Wells Fargo Ruling'


As turmoil swept financial markets, banking officials stepped up their efforts to change the law.

Senior executives from the banking industry told top Treasury officials at the beginning of the year that Section 382 was bad for businesses because it was preventing mergers, according to Scott E. Talbott, senior vice president for the Financial Services Roundtable, which lobbies for some of the country's largest financial institutions. He declined to identify the executives and said the discussions were not a concerted lobbying effort. Lobbyists for the biotechnology industry also raised concerns about the provision at an April meeting with Solomon, the assistant secretary for tax policy, according to talking points prepared for the session.

DeSouza, the Treasury spokesman, said department officials in August began internal discussions about the tax change. "We received absolutely no requests from any bank or financial institution to do this," he said.

Although the department's action was prompted by spreading troubles in the financial markets, Carroll said, it was consistent with what the Treasury had deemed in the December report to be good tax policy.

[Trojan]

4. And Finally This !

Questions About a Tax Change Easing Bank Mergers
November 10, 2008, 7:10 am

With so much focus on the government’s $700 billion bailout fund, The Washington Post examines a relatively little-noticed tax change that delivers potentially huge windfalls to banks that acquire other troubled banks.

Some lawmakers have privately suggested the Treasury Department’s move to change the tax rule was illegal. One expert says so explicitly:

“Did the Treasury Department have the authority to do this? I think almost every tax expert would agree that the answer is no,” George K. Yin, the former chief of staff of the Joint Committee on Taxation, the nonpartisan congressional authority on taxes, told the Washington Post. “They basically repealed a 22-year-old law that Congress passed as a backdoor way of providing aid to banks.”

Andrew C. DeSouza, a Treasury spokesman, told the Post that the administration had the legal authority to issue the notice as part of its power to interpret the tax code and provide legal guidance to companies.

Go to Article from The Washington Post (See Above Posts)

[BrklynLiberal]

6. see if this helps at all...

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=103&topic_id=400427&mesg_id=400427

[katty]

5. not surprised

[The Traveler]

7. Commissar Paulsen

continues to seize the means of production.

:rofl:

[OneBlueSky]

8. one of the first things Obama must do is turn off the money tap . . .

that seems to have been flowing wide open and constant for the past eight years . . . he and his team have to take control of the outflow of dollars like never before, and cut off all of the illigitimate expenditures and giveaways (like this one) that are enriching the few at the expense of the rest of us . . . and of our children . . . and our grandchildren . . . etc., etc., etc. . .

[indepat]

9. 'pukes are masters at designing ways to offload the U.S. Treasury fbo of large corporations:

that's their job # one which is be expected of any corporatist (fascist) regime. :P