Morning Bell: Bank Tax Misses the Real Bailout Deadbeats in Detroit and DC

Conn Carroll / January 15, 2010

Facing rising populist anger over his administration’s billion-dollar bailouts, President Barack Obama proposed a $117 billion tax over the next 12 years on financial companies with assets of more than $50 billion. “We want our money back, and we’re going to get it,” the President said. The President is half right. Taxpayers are going to get their money back from the banks that received bailout money … but don’t expect to see any of the money the Obama administration poured into General Motors and Chrysler at the behest of their union allies. That is where the real losses are coming from.

The TARP program has so far distributed $247 billion to more than 700 banks. Of that, $162 billion in principal and $11 billion in interest and dividends have already been repaid. Except for AIG, almost all banks that received taxpayer money are expected to pay back the American taxpayers in full. As The New York Times reports: “The losses from the bailout fund are expected from money paid to rescue Chrysler and General Motors and the insurance giant American International Group, and from a program to help homeowners avert foreclosures.” (more…)