Tax on Banks?

I read today that Obama “unveiled a new tax on banks.” From a brief skim my take is it is retribution for the bonuses paid out by the large bank corporations after the bailout money was given to them.

This, quite simply, is ridiculous rhetoric that does nothing to help the economy, but may curry favor with voters come next election.

Quite simply put, the banks are partly to blame, but most of the blame should be sent to Ben Bernanke, Time’s Man of the Year and head of the Federal Reserve Bank and his predecessor, Alan Greenspan. This is what happens when you have a central bank that has the power to create money and artificially control interest rates. The recent housing bubble was the result of artificially fixing the interest rates at like 1% for many years, followed by the eventual rise, which popped the bubble. Until the Federal Reserve Bank is gone, we will not have a free market economy.

The way that the taxpayer (read “Middle Class”) will pay in the end s that the existence of all of the money that was created out of thin air to bail out these banks will dilute the value of the dollar, internationally. It’s not that we’ll pay more taxes, nor should we: The government already spends far more than they levy in income taxes, so taxing banks will not make a dent in the deficit, nor will it do anything to help the economy. As we are teetering on the edge of some hard times (rampant inflation), I would hope our President could come up with something more legitimate. I’m sure Joe Average will say “That’s right…stick it to them banks!” But really, it is not going to do anything, IMHO.