Conservative coalition urges killing ‘TAG’ bank bailout
WASHINGTON (Dec. 10, 2012) – In a letter to Sens. Harry Reid, D-Nev., and Mitch McConnell, R-Ky., representatives of 14 conservative, libertarian and free-market groups call on the Senate leaders to allow the Transaction Account Guarantee program, better known as TAG, to expire as scheduled on Dec. 31.
Created at the height of the financial crisis in October 2008, TAG offers unlimited Federal Deposit Insurance Corporation coverage to noninterest-bearing transaction accounts. The majority leader has scheduled a cloture vote for 5:30 p.m. today on S. 3637, a bill that would extend TAG’s unlimited guarantees through 2014.
If TAG is allowed to expire at the end of this year, the FDIC’s guarantees on checking accounts and many other transaction accounts would revert to the ordinary $250,000 limit that covered such accounts before the Wall Street bailouts of 2008.
“It is especially ironic that Congress is contemplating raising tax rates for those making above $250,000, and TAG further encourages the wealthy to sit on their money, rather than invest in job-creating new businesses,” the groups wrote to Reid and McConnell. “Many wealthy people will choose the security of a 100-percent guaranteed bank account rather than taking a risk with an entrepreneur.”
The groups added that Congress should look instead to offer regulatory relief to banks, credit unions and other financial institutions, rather than “extending this unprecedented, unproductive, and regressive bailout.”
In addition to R Street, the letter was signed by representatives of the Competitive Enterprise Institute, Blue Ridge Forum, American Commitment, the Republican National Policy Committee, the 60 Plus Association, Tea Party WDC, Less Government, the Center for Freedom & Prosperity, National Center for Public Policy Research, National Taxpayers Union National Tax Limitation Committee, American Enterprise Institute and Human Events.
For a copy of the full letter, please visit here.
