Thomas Oatley is an is an associate professor of political science at the University of North Carolina, Chapel Hill. He wrote an article in the Washington Post. Oatley made this chart that shows the flow of American investment money heading to the tax haven of the Cayman Islands.
President Barack Obama signed the Foreign Account Tax Compliance Act (FATCA) into law in 2010. The United States and the Cayman Islands reached an agreement. Cayman banks must notify the IRA of any U.S. account with more than $50,000. The law won't officially take effect until 2014.
Banks, funds and other financial institutions that fail to comply with FATCA face a 30-percent withholding tax on their U.S. source income, a penalty that could effectively freeze them out of U.S. financial markets.
Investment bankers have an army of tax attorneys. I'm sure they will find a way around FATCA.
President Barack Obama needs 60 votes to get anything done in the Senate. Sen. Bernie Sanders is on record as saying he will not vote to confirm Jack Lew to be the next Treasury Secretary.
“We don't need a treasury secretary who thinks that Wall Street deregulation was not esponsible for the financial crisis. We need a treasury secretary who will work hard to break up too-big-to-fail financial institutions so that Wall Street cannot cause another massive financial crisis.
“We don’t need another treasury secretary who believes in ‘deficit neutral’ corporate tax reform. We need a treasury secretary willing to fight to make sure that large, profitable corporations pay their fair share in taxes to reduce the deficit and create jobs.
“We don't need a treasury secretary who will advise the president that he should negotiate with the Republicans to cut Social Security, Medicare, and Medicaid benefits. We need someone who is going to strengthen these programs.
Another big problem with Jack Lew is he doesn't know shit about economics. Just ask Jack Lew.
SENATOR SANDERS: We are in the midst of a horrendous recession right now; 16 percent of our people are unemployed or underemployed. Clearly the immediate precipitating factor was the collapse on Wall Street. Do you believe that the deregulation of Wall Street pushed by people like Alan Greenspan and Robert Rubin contributed significantly to the disaster we saw on Wall Street several years ago?
MR. LEW: Senator, when we discussed it, as I mentioned to you, I do not consider myself an expert in some of these aspects of the financial industry. My experience in the financial industry has been as a manager, not as an investment adviser.
My sense, as someone who has generally been familiar with these trends, is that the problems in the financial industry preceded deregulation. There was an increasing emphasis on highly abstract leveraged derivative products that got us to the point that in the period of time leading up to the financial crisis risks were taken. They were not fully embraced. They were not well understood.
I do not personally know the extent to which deregulation drove it, but I do not believe that deregulation was the proximate cause. I would defer to others who are more expert about the industry to try and parse it better than that.
America is in trouble if we have another crash. Whatever misgivings I have about Tim Geithner, he at least spent his adult life working on economic policy. Lew is a smart Guy who is not qualified to handle an economy going through an L shaped recovery.
The stupidity of CNBC columnist John Carney is beyond words. Carney believes that 234 million shares of AIG stock to avoid paying a higher capital gains tax next tax year.
One question that comes to mind is whether the timing of this sale of the last of the Treasury's stake in AIG allowed the Treasury to avoid rising capital gains taxes in 2013. In 2013, when the law that temporarily lowered capital gains rates expires, the rates on long term capital gains are set to rise from 15 percent 20 percent. Lots of investors are attempting lock-in gains now to avoid paying the higher rate. Did the Treasury just do the same thing?
Carney then goes on to cry about the Treasury Department being tax exempt. The harsh injustice of it all. What Carney fails to realize that on the AIG share sale the point is moot. The IRS is part of the Treasury Department. Carney cries about Treasury not paying capital gains taxes on the AIG sale. If Treasury did pay taxes on the AIG sale it would just collect the money back through the IRS.
The stupidity of the people that work at CNBC amazes me.
The Treasury Department announced that the federal deficit for 2012 is $1.089 trillion. The federal budget shortfall for last year was $1.297 trillion. You can see by the chart made by Steve Benen that the deficit has gone down under President Barack Obama.
The Republicans cry about the stimulus. There were massive layoffs across the country. The Congressional Budget Office reports that the stimulus created 3.3 million full-time jobs. The stimulus was a one-time spending package. The Bush tax cuts, TARP bailout, Iraq war, and Bush's refusal to fight with his own party on yearly pork spending have had long-term effects on the deficit.
Paul Ryan wasn't crying about deficit reduction during the Bush years. Ryan was helping craft these massive spending bills in the Budget and Ways and Means committees.
I like to hear Litbrit's thought on this. She knows Klein. I can't anyone seriously as a Democrat policy wonk when he ask questions like this on Twitter
Are there any Republicans who would a) serve as Obama's Treasury Sec., B) support some tax hikes, and c) Republicans still like?
The answer to that Klein's question is Bruce Bartnett. I appreciate David Stockman's honesty but he would push for cuts that would hurt growth.
Klein doesn't ask who is the best candidate for Treasury Secretary. Joseph Stiglitz is smart enough. It would be hard for a Treasury Secretary that calls the banks corrupt to work with the banks. That is part of the Treasury Secretary's job discription. Gene Sperling as an economic adviser to Geithner. Geithner later was appointed to the Director of the National Economic Council. Sperling held the same position in the Clinton administration. Obama is comfortable with Sperling. This is about as close to a progressive that Obama would appoint to Treasury.
Open thread: who would you like to see as the next Treasury Secretary? Word is Tim Geithner is quitting soon. The Treasury Department needs a person extraordinary talent. Geithner was not that person. I'm sure you can think of someone better than Klein's Republican suggestion.
Neil Barofsky was the inspector general of the Troubled Asset Relief Program from 2008 until March 30, 2011. Barofsky declared TARP a "failure." Barofsky accused Sec. of Treasury Tim Geithner of refusing to protect homeowners and reform financial institutions. These accusations are coming from someone who was in charge of oversight of TARP.
Treasury Secretary Timothy Geithner has acknowledged that the program "won't come close" to fulfilling its original expectations, that its incentives are not "powerful enough" and that the mortgage servicers are "still doing a terribly inadequate job." But Treasury officials refuse to address these shortfalls. Instead they continue to stubbornly maintain that the program is a success and needs no material change, effectively assuring that Treasury's most specific Main Street promise will not be honored.
The "Main Street" promise is to keep Americans from losing their homes. Geithner and President Obama won't lift a finger to help homeowners. They will support the Federal Reserve buy toxic mortgages from banks. Americans are being forced into homelessness by banks setting up rocket docket courts around the country.
Geithner has also allowed banks to repay meney owed to TARP by tapping into the small bussiness fund. Banks are repaying money owed with taxpayer money meant to be used to give loans to small businesses. Small businesses end up not getting the loans they desperately need.
The Obama administration is a DINO administration. Americans are suffering and their only priority is protecting financial institutions responsible for the 2008 crash.
I blogged about the "rocket docket" foreclosure courts in Florida. There is good indication that the David J. Stern law firm forged foreclosure documents. Judges in Florida foreclosure courts have been known not to review foreclosure documentation before evicting a homeowner. The problem became public thanks to Matt Taibbi's reporting in Rolling Stone.
Apparently, the problem has garnered the attention of the Treasury Department. Phyllis Caldwell, Chief of Homeownership Preservation Office, testified before the Senate Finance Committee.
The reports of "robo-signing", faulty documentation and other improper foreclosure practices by mortgage servicers are unacceptable. If servicers have failed to comply with the law, they should be held accountable. The Administration is leading a coordinated interagency effort to investigate misconduct, protect homeowners and mitigate any long-term effects on the housing market. While Treasury does not have the authority to regulate the foreclosure practices of financial institutions, nor to ensure that those practices conform to the law, it is working closely with agencies that do have such authority.
The Financial Fraud Enforcement Task Force, a broad coalition of law enforcement, investigatory, and regulatory agencies that brings together more than 20 federal agencies, 94 U.S. Attorneys Offices, and dozens of state and local partners, is working to ensure that foreclosure practices are thoroughly investigated and any criminal behavior is prosecuted. The Federal Housing Administration (FHA) has been reviewing servicers of loans it insures for compliance with loss mitigation requirements. Additionally, the Office of the Comptroller of the Currency has directed all large national bank servicers to review their foreclosure management processes – including file reviews, affidavit processing, and signatures – to ensure that the processes are fully compliant with all applicable state laws. The other independent banking regulatory agencies are doing similar reviews of institutions under their jurisdiction. Attached to my testimony is a fact sheet providing more detail concerning the activities of the coordinated interagency effort.
I hope Caldwell cracks down on these bogus foreclosures. We could be talking about millions who were thrown out of their homes because of shady legal practices.
President Barack Obama is proposing to extend the research and development tax credit. The problem is the tax credit for R&D would cost an estimated $100 billion in tax revenue. Obama is hoping the R&D tax credit will spur development. The President will have to figure what he will have to cut to help reduce the deficit. The White House is also considering infrastructure spending and to free up credit for small businesses.
Elizabeth Warren, chair of the Congressional Oversight Panel explained to Steve Chiotakis why there is such difficulty for small businesses to get loans.
Chiotakis: So Professor, if small businesses generate, what, two of three jobs in this economy, doesn't this fly in the face of the necessity of bailing out the banks in the first place?
Warren: Well you know, that's really the irony here isn't it? Remember, in the fall of 2008, Secretary Paulson went to Congress and the American people and said, we need this $700 billion bailout, because if we put the money into the banks, that's how it will make it on into the real economy. And the evidence shows that simply didn't happen; we put the money into big Wall Street banks and that's where it stayed.
Treasury Sec. Tim Geithner extended TARP until October of 2010. However, small businesses are still having a tough time getting loans. Geithner has not been able to get small banks to paticipate. The Independent Community Bankers of America gave Geithner a list of demands that must be meant before these banks will paticipate. Why doesn't Geithner just set up a temporary loan guarantee funds for small businesses? The small banks don't want to take the financial risk. Small businesses can get loans through the federal government to expand and hiring extra labor.
Duncan Black and Mike Konczal question how much job creation and economic growth will come from R&D tax credits. The H. Lee Moffitt Cancer Center & Research Institute in Tampa received $20 million in stimulus money. Director Thomas Sellers told TBO.com that the stimulus money is helping Moffitt produce fifty patent a year and five start-up companies.
As a longterm policy, helping spur research is smart. It isn't going to turn the economy around. What this tells me is Geithner and Obama's economic team has run out of ideas.
I wrote this post on Twitter about John Boehner calling for President Barack Obama to fire Tim Geithner and Lawrence Summers.
@thereidreport Boehner asking for Geithner to be fired would have progressives press for a more Left-leaning Sec o Treasury.
Geithner backed executive bonuses for AIG bonuses. AIG CEO Edward Liddy told Congress Geithner knew about the bonus money executives were going to reward themselves. Time reported the New York Federal Reserve informed Geithner of the bonuses before the March 10, 2009 date Geithner gave Congress.
Although Treasury Secretary Timothy Geithner told congressional leaders on Tuesday that he learned of AIG's impending $160 million bonus payments to members of its troubled financial-products unit on March 10, sources tell TIME that the New York Federal Reserve informed Treasury staff that the payments were imminent on Feb. 28. That is 10 days before Treasury staffers say they first learned "full details" of the bonus plan, and three days before the Administration launched a new $30 billion infusion of cash for AIG.
Dodd tells CNN that the Treasury Department told him to take out amendment limiting executive bonuses.
As head of the New York Federal Reserve, records show Geither told AIG to take out references to key deals from regulatory filings. This is extremely unethical for a public servant to do. At the New York Federal Reserve, Geither negotiated the AIG bailout plan. Geithner is more aware than most of the financial troubles AIG is facing. Geither placed protecting AIG above the American public.
Geithner used AIG to funnel bailout money to cover Goldman Sach's naked credit default swaps losses. Goldman Sachs played a significant role in the mortgage meltdown. Goldman Sachs betted against the housing industry and attempted to collect on the CDS. AIG was too extended to pay when the 2009 Wall Street meltdown occurred. Both AIG and Goldman Sachs did a nose dive and the taxpayers were left with the bill. Geithner's response has been to protect these institutions from oversight.
Jon Walker of Firedoglake explains why firing Geithner and Summers is bad politics for the Republican Party.
House Minority Leader John Boehner (R-OH) has recently called on President Obama to fire Treasury Secretary Tim Geithner and Director of the National Economic Council Larry Summers. Now I don’t know how Boehner’s mother raised him, but where I come from, that behavior would be considered downright rude. Where is the gratitude? I think John of Orange owes them an apology. Trying to get the two individuals whose actions played a major role in assuring that Boehner will be promoted (to the position of Speaker of the House after Republicans win big this November) fired is just bad manners in my book. If it weren’t for Summers’ terrible economic projections and horrible advice, combined with Geithner’s equally bad counsel, consistently putting the prosperity of Wall Street over main street while horribly mismanaging the HAMP program, Boehner would not be close to measuring the drapes for the Speaker’s office.
Summers favors the current banking monopoly and urged Bill Clinton to sign the Gramm-Leach-Bliley Act. As President of Harvard, Summers made the sexist statement that women do not have the same "aptitude" as men to succeed.
Unfortunately, Geithner and Summers hold too much sway over the President. It is ashame because this maybe the only time I will ever agree with Boehner.
"You cut taxes and the tax revenues increase," President bush told the American people. The Congressional Budget Office found the President's tax cuts did not create the promise budget surplus. In 2006, Bush's Treasury Department correctly predicted that the Bush tax cuts would create less revenue growth than the 1980s and 1990s.
This lack of Republican economic ignorance makes Congressional candidate David Rivera's tweet all the more troublesome.
FL’s unemployment rate reached a record 12.3%. In Congress I'll work to pass tax cuts & incentives to spur job creation & econ growth.
This is why I tell people members of Congress should be forced to take an economics class.
Speculation has also begun about potential employment for Dodd in the Obama administration.
For instance, several Democratic Senate aides noted that Treasury Secretary Timothy Geithner is an extremely unpopular figure in the Senate. Geithner has also taken the brunt of the criticism for the administration’s handling of the economy and, these sources speculated, if the country’s financial picture does not brighten before Election Day, he could be the first secretary to leave the administration.
Although Dodd would appear to be well-situated to take control of Treasury if the position were to open, it may not be smooth sailing for his nomination.
Dodd has been a recipient of the financial industry's generousity. Below is a list of the twenty organizations that been given the most money to Dodd's campaign. ActBlue is the only group that can be described as liberal. If Dodd does become Sec. of Treasury at least he will know all the lobbyists from the major banks.
1 Citigroup Inc 2 SAC Capital Partners 3 United Technologies 4 Royal Bank of Scotland 5 ActBlue $209,000 $209,000 $0 6 Bear Stearns 7 American International Group 8 Merrill Lynch 9 Goldman Sachs 10 Credit Suisse Group 11 Morgan Stanley 12 Travelers Companies 13 JPMorgan Chase & Co 14 The Hartford 15 Hartford Financial Services 16 St Paul Travelers Companies 17 General Electric 18 FMR Corp 19 Ernst & Young 20 Bank of America
Tresury Sec. Tim Geithner told the House Appropriations subcommittee money lending institutions pay back to the Treasury Department will be used to bail out other companies.
"We're still in a very challenging economic and financial situation," Geithner said.
Geithner sends a message to Governors, such as Mark Sanford, whom want to use TARP money to pay down their state deficits.
Treasury Secretary Timothy Geithner said the U.S.’s $700 billion financial rescue package can’t be used to aid cities and states facing budget crises.
The law “does not appear to us to provide a viable way of responding to that challenge,” Geithner told a House Appropriations subcommittee in Washington today. Among the hurdles: Money from the Troubled Asset Relief Program is reserved for financial companies, he said.
Geithner left open the possibility of a federal response to California's deficit.
“There are important indications that our financial system is starting to heal,” Mr. Geithner told lawmakers, though he cautioned that it was still too early to talk about an “exit strategy” for the government.
I have several questions. When will the lending institutions be financially solvent enough to stand on their own? How much money being repaid to the Treasury Department? Is the Obama administration willing to reform banks are does it want to maintain the status quo? This is a lot of money we are dealing with and Geithner does not project confidence. Overly-dramatic hand gentures don't count.
ABC News reports consumer confidence dropped 3 points this week. The national unemployment rate in April increased to 8.9 percent. The unemployment numbers are effecting the stock market. The Republican response of tax cuts and spending freeze are not backed by economists. Talking points aren't the answer. Geithner needs to explain what that answer is.
President Barack Obama signed the Foreign Account Tax Compliance Act (FATCA) into law in 2010. The United States and the Cayman Islands reached an agreement. Cayman banks must notify the IRA of any U.S. account with more than $50,000. The law won't officially take effect until 2014.
