Sins of the Fatcat
March 20, 2014
Bob Ivry’s guide for tracking down the live villains and unburied bodies of the 2008 crash
By Andrew Cockburn
Back in February, Congressman David Camp (R., Mich.), chairman of the tax-writing House Ways and Means Committee, unveiled a plan to reform the U.S. tax code, clarifying and simplifying its infinite and tortuous provisions. One of his proposals was to levy a tax of .035 percent on assets exceeding $500 billion held by U.S. megabanks and insurance companies. This, he explained, would offset the advantage big banks enjoy in borrowing costs thanks to their implicit government-bailout guarantee as too-big-to-fail institutions.
It was a laudable enough idea, in a modest kind of way. Coming from a House Republican it certainly had the merit of novelty. But no one among the massed ranks of financial-industry hirelings on K Street and Capitol Hill took it seriously enough to plan a vigorous counterattack. Camp is due to step down from his chairmanship soon, and everyone in Washington is well aware of the banks’ invulnerability to attempts at prizing away even a sliver of their hoards. “Dead on arrival” was the common verdict.
That wasn’t the way JPMorgan Chase CEO Jamie Dimon, Wall Street’s capo di tutti frutti, saw things, though. “He was calling everyone, from the Speaker on down,” one lobbyist reported to me in amazement. “He was frantic about the threat of Camp, as if anything was ever going to come out of that.”
The only interpretation the D.C. financial lobbying community could make of Dimon’s hysterical behavior was that they had done their work too well. “The banks have gotten absolutely everything they wanted, post-crash,” my lobbyist friend explained. The 2010 SAFE bill, through which Senators Sherrod Brown and Ted Kaufman attempted to break up the too-big-to-fails? Crushed like a bug in the Senate, 60–31. The Volcker Rule restricting banks from trading on their own account? Riddled with more loopholes than a yard of chicken wire. The Lincoln Amendment barring institutions from gambling with taxpayer-insured money? On its way out the door. “There really are no outstanding issues left for them to fight over,” my friend said, “so now even the semblance of defiance from any quarter is taken as a personal affront, and they move to crush it.”
in full: http://harpers.org/blog/2014/03/sins-of-the-fatcat/
