It was always going to be a seamless transition from John Boehner to Paul Ryan. These men are cut from the exact same cloth, which is worshipping at the altar of crony capitalism. They talk a good game about about “free markets” and “entrepreneurship,” but at the end of the day, are both staunch defenders of statist, centrally planned economies, as long as the subsidies go to mega-corporations.
David Dayan, who’s excellent work I’ve covered many times here at Liberty Blitzkrieg, just published an article at the Fiscal Times outlining the plethora or Wall Street giveaways recently added onto the “Highway Bill.” One of these relates to something I’ve covered previously, the 6% annual dividend paid by the Federal Reserve to its member banks. Here’s some background from a previous post, Banks Squirm as Congress Moves to Cut the 6% Dividend Paid to Them by the Federal Reserve:
Have you looked at your checking or money market bank statement lately from JPMorgan Chase or Citibank? How about the statement showing the interest you’re earning on your mortgage escrow account with the big banks? While the country suffers through the lingering effects of the Great Recession caused by the biggest Wall Street banks, the public typically receives less than 1 percent on their deposits at the big banks, while the government has legislated a permanent, risk-free 6 percent guarantee to the Wall Street banks for their capital on deposit at the Fed. Now that’s an entitlement program that needs to die!
This corporate welfare program gets even better: if the shares of stock were acquired prior to March 28, 1942, the 6 percent risk-free dividend is tax exempt and the bank doesn’t have to pay corporate taxes on it.
There had been a Senate proposal in the Highway Bill to reduce this payout to 1.5% for all banks with more than $1 billion in assets. Naturally, the Republicans in the House, led by Paul Ryan, killed it. Wall Street always gets it way in Congress. Always.
From the Fiscal Times:
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