Martin Wolf: Tax Windfall Bonuses

Martin Wolf wants to take bankers who are living large on the taxpayer dole, and tax them, big and hard. He gives 6 reasons:

1) Some institutions that are “making exceptional profits because they are beneficiaries of unlimited state insurance for themselves and their counter-parties.” These largest business subsidies ever deserve to be taxed.

2) “Profits being made today are in large part the fruit of the free money provided by the central bank, an arm of the state.” It is not the role of the state to give banks a “license to print money.”

3) Generous bailouts were “to restore the financial system and the economy, not to enrich bankers.”

4) Risk takers deserve huge rewards — but not those who risked and lost and were rescued by the state.

5) Exceptional interventions in times of crisis also mean exceptional interventions to recoup costs when the crisis is past.

6) These enormo bonuses are “Hidden gifts” from the state. What the state gives, the state is entitled to take back.

Can’t say i find much to disagree with there . . .


Tax the windfall banking bonuses
Martin Wolf
FT, November 19 2009 22

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