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Want a Tax Break like Citigroup, Send the President 20 Bucks

Prof. Peter Morici - 12/19/2009

The Internal Revenue Service is suspending tax rules for Citigroup and other TARP recipients to permit those companies to more rapidly pay back the Treasury what they owe in TARP loans, and to their boost stock prices.

For Citigroup, that means an additional $38 billion in tax deductions to help the beleaguered company pay the Treasury the $20 billion it owes the TARP. In addition, these breaks will juice Citigroup, GM and other TARP recipients’ stock prices, and make TARP’s huge equity positions more valuable.

At General Motors, the value of Treasury stock may never equal what the TARP paid for it, and juicing stock prices in this manner serves to make the bad and ill-conceived investments at Citigroup, GM and others, approved by Treasury Secretary Timothy Geithner and President Barack Obama, look better than they are.

As the IRS and TARP both are part of the Treasury, Geithner is giving away taxpayer money to preserve his own tainted reputation, and cover up President Obama’s bad bets and payoffs to their Wall Street pals.

The president continues to talk tough about bank bonuses but at his recent meeting with the big bank CEOs he did not float the idea of taxing undeserved bank bonuses as the British Prime Minister is imposing for similar abuses across the pond.

Instead, the President encouraged bankers to better explain to the public why bank executives deserve the $140 billion in bonuses they “earned” using extraordinary government aid to dig out of a crisis they created.

Meanwhile, the President continues to aggressively fund raise on Wall Street for Democrats, and all the while he is advised by Lawrence Summers who took millions from Wall Street banks in 2008.

Don’t feel like paying all your income taxes this year? Send the president $20 to help out his Democratic congressional pals campaigning for reelection next fall, and ask for a break when you file your Form 1040 this April.

Who knows, the President says he likes small contributors, and who he likes, and who pays him, seem to get very nice bonuses and tax breaks.