Tuesday, December 15, 2009

The Hits Just Keep Coming - One Set of Rules for You Another for the Banks

In the latest abomination the Obama administration has changed tax law for Citibank. Not to belabor the technicalities, but US tax law generally limits a taxpayer's ability to utilize operating losses to offset prior or future income. The limitation is operational where there is a change in control. The disposal of the federal government stake of approximately 34 percent of Citi combined with the equity offering runs into this problem. But as if by a king's decree the Obama administration is pretending as though the limitation doesn't exist in Citi's case. The impact is only $38 billion, yes $38 BILLION. This is beyond obscene, I think it's illegal. Now mind you I just learned this so I need to investigate it further, but I can't imagine how else it could work (I am a tax attorney). Essentially, US taxpayers have just bailed out Citi to the tune of another $38 BILLION, and no one's the wiser. Are you kidding me. This is beyond the pale.

Wednesday, December 09, 2009

The Mess That is Our Government

I am beyond disgust. What has happened the last week. Obama finally talks about jobs and then sources say he'll fund it with TARP funds. The knucklehead Harry Reid gets some semblance of a health care bill through (although it's ultimate prospects remain unclear). All this followed by the EPA's display of hubris, by saying if Congress didn't act that they'd put forward their own onerous version of cap and trade (put aside the ridiculously long amount of time that would take). This idiocy is only rivaled by the inanity of the loyal opposition. The Republicans say nothing meaningful.

The only conclusion I can draw is that they are completely out of touch with reality. It is shocking, simply shocking that all these idiots can do is either try to shout the other side down or trying to push forward a laundry list of political priorities irrespective of the economic reality we find ourselves in now. I have always been a political afficiando, but never have I felt so entirely voiceless. The situation is glum indeed.