Research Briefing

A Look At Why American Taxpayers Want Their Money Back From Obama, While He Misleads Americans On What His Savings Tax Will Do

OBAMA CLAIMING HIS SAVINGS TAX WILL “GET YOUR MONEY BACK, EVERY DIME.” “We’re having a fight right now because I want to charge Wall Street a modest fee to repay taxpayers in full for saving their skins in a time of need. We want our money back … And we’re going to get your money back, every dime -- each and every dime.” (President Barack Obama, Remarks During Town Hall Meeting In Elyria, OH, 1/22/10)

BUT IT’S AMERICAN TAXPAYERS THAT ARE DEMANDING THEIR MONEY BACK FROM OBAMA

Americans Want $862 Billion Back After Obama’s Stimulus Failed To Prevent Double Digit Unemployment. “CBO’s current projection of ARRA’s budgetary impact over the 2009–2019 period—a total increase in deficits of $862 billion—is about $75 billion greater than the agency originally estimated.” (“The Budget And Economic Outlook: Fiscal Years 2010 To 2010,” Congressional Budget Office, 1/26/10; U.S. Bureau of Labor Statistics, www.bls.gov, Accessed 1/26/09)

Americans Want $50 Billion Back After Obama’s Takeover Of GM Led To $1.2 Billion Lost In Third Quarter Of 2009. “The government invested almost $50 billion in GM over the course of the last year, debt which was converted to equity in the automaker. The federal government maintains a 61 percent stake in the company.”; “General Motors Co. says it lost $1.2 billion from the time it left bankruptcy protection through Sept. 30 …” (Michael O’Brien, “GM Will Repay Bailout Loans By End Of June,” The Hill, 1/25/10; Tom Krisher, “GM Reports $1.2B 3Q Loss, Says It Shows Progress,” The Associated Press, 11/16/09)

Americans Want Millions Of Dollars Back From Obama’s Pay Czar, Who Allowed Some Bailed-Out Companies To Give Salaries Of Up To $1.5 Trillion After Pledging That Salaries Of Those Firms Would Be Limited to $500,000. “White House pay czar Ken Feinberg announced Friday the second round of rules governing executive compensation for bailed out companies … cash salaries would be generally limited to $500,000 a year … there will be about 12 exemptions granted to executives so their companies will be able to ‘thrive, be able to compete, and not lose key people,’ Feinberg said. Under the exemptions, one person will receive a $1.5 million salary. The remaining 11 will earn between $500,000 and $950,000. (Daniel Carty, “Pay Czar Puts $500K Limit On Executive Compensation,” ABC News, “EconWatch” Blog, 12/11/09)

That’s Why 51 Percent Of Americans Disapprove Of Obama’s Handling Of The Economy, While 42 Percent Approve. (“Few See Personal Upside To Health Care Reform,” The Pew Research Center, 1/14/10)

• And 58 Percent Of Americans Disapprove Of Obama’s Handling Of The Federal Deficit, While 32 Percent Approve. (“Few See Personal Upside To Health Care Reform,” The Pew Research Center, 1/14/10)

AS OBAMA CONTINUES TO DECEIVE AMERICANS ON TRUE PURPOSE OF HIS SAVINGS TAX …

Obama Claims Goal Of Tax On “More Than 20 Of The Nation’s Largest Banks And Other Financial Companies ... Is To Recoup The Taxpayer Cost Of TARP ...” (Mike Allen, “Politico Playbook,” Politico, 1/13/10)

But Nation’s Largest Banks Targeted By Savings Tax Have Already Repaid TARP Funds. “Wells Fargo & Co. and Citigroup Inc ... both repaid their government aid, escaping heightened regulatory and public scrutiny. ...With the actions by Wells Fargo and Citi, the nation’s four largest banks have returned their aid packages, as have several large regional banks. ...J. P. Morgan Chase & Co., Goldman Sachs Group Inc., Morgan Stanley, Capital One Financial Corp., and BB&T Corp. were among the first to repay earlier this year.” (Matthias Rieker, “UPDATE: Wells Fargo and Citi Complete TARP Repayments,” The Wall Street Journal, 12/23/09)

• And Insurance Companies That Did Not Receive TARP Funds Will Be Hit By Savings Tax. “A handful of large insurance companies, most of which turned down government bailout funds, would likely owe money under the proposed Financial Crisis Responsibility tax.” (Lavonne Kuykendall, “Insurers Would Owe Under Proposed U.S. Financial Tax,” The Wall Street Journal, 1/19/10)

Meanwhile, Automakers Who $30 Billion In Taxpayer Money Won’t Be Subject To The Tax. “The December report for the Troubled Asset Relief Program, or TARP, showed that the fiscal 2009 net loss included estimated losses of … $30.4 billion for automakers ...”;  “It’s unclear precisely who would be subject to the fee. A person familiar with the matter said it’s unlikely for now to target auto companies or American International Group Inc., all of which are still struggling. Homeowners who benefited from government-funded housing help also wouldn’t pay the fee.” (David Lawder, “AIG, Autos Offset Treasury Bank Bailout Profits,” Reuters, 1/11/10; Deborah Solomon and Damian Paletta, “Banks Brace For Bailout Fee,” The Wall Street Journal, 1/13/10)

• And Warren Buffet Points Out Fannie Mae And Freddie Mac Owe Roughly $110 Billion, And Will Be Exempt From The Tax. “‘Look at the damage Fannie and Freddie caused, and they were run by the Congress,’ said Buffett. ‘Should they have a special tax on congressmen because they let this thing happen to Freddie and Fannie? I don’t think so …’ Fannie Mae and Freddie Mac owe about $110 billion, according to Bloomberg data.” (Andrew Frye, Betty Liu and Jamie McGee, “Buffett Says He Can’t See Rationale for Bank Levy” Bloomberg 1/25/10)

Rep. Barney Frank (D-MA) Admits Revenue From Savings Tax Will Be Used For More Government Spending, Won’t Be Directly Returned To Taxpayers. “I think getting revenue from these banks is a good way to get some revenue for necessary things ...” (CNBC’s “Street Signs,” 1/14/10)

AMERICANS ARE BEGGING HIM NOT TO TAKE ANY MORE OF THEIR MONEY

Obama Continuing To Push Government-Run Health Care Experiment Paid For By $518.5 Billion In Tax Increases On Health Insurance, Small Businesses, And Medical Treatments.   (Senate Finance Committee Minority Staff Review Of JCT And CBO Cost Estimates, 12/19/09)

• That’s Why 52 Percent Of Americans Disapprove Of Obama’s Handling Of Health Care, While 38 Percent Approve. (“Few See Personal Upside To Health Care Reform,” The Pew Research Center, 1/14/10)

Obama Increasing Non-Defense Discretionary Spending By 19.5 Percent For FY 2010, The Largest One-Year Increase Since Jimmy Carter In 1976. (Office Of Management And Budget, “Table 8.7--Outlays For Discretionary Programs: 1962-2014,” Accessed 12/11/09)

• Which Doesn’t Include Plans For Stimulus II, Costing Anywhere Between $80 Billion And $174 Billion, That Looks Exactly Like Stimulus I. “Senate Democrats are considering a jobs bill in the range of $80 billion … a draft summary of proposals under discussion includes small business credits, tens of billions of dollars in infrastructure spending, energy efficiency programs, money to hire police and firefighters and billions to boost lending to small businesses … Senate Democrats have pledged to take up jobs legislation early this year, after the House passed a $174 billion bill late last year.” (Silla Brush, “Senate Democrats Consider $80B Jobs Bill,” The Hill, 1/25/10)

Obama’s Binge Spending Will Nearly Double National Debt Over 9 Years, From $11.9 Trillion To $23 Trillion. (White House Office Of Management And Budget, “Mid-Session Review: Fiscal Year 2010,” 8/25/09)