Economic Recovery Measures
On Friday evening, the FDIC reported that it has taken over an additional bank (San Joaquin Bank) for a cost to the FDIC of around $103 million. This brings the total number of failed banks since the beginning of 2008 to 115. Total deposits of all failed banks now equal $88.3 billion for 2009 and over $322 billion since the beginning of 2008, all at an estimated cost to the FDIC of over $48 billion.
Today PERAB, otherwise known as the Tax Reform Subcommittee of the President's Economic Recovery Advisory Board, is holding a meeting focusing on tax code simplification, enforcement, and corporate tax reform. PERAB is holding a series of meetings on tax reform, and will submit a final report in December of this year that will outline a number of reform options.
Today Congressional Quarterly reported that Congress is feeling pressure to extend the tax credit for homebuyers that was included in the stimulus bill in February. The $8,000 tax break, which applies to first time homebuyers, is designed to revive the housing market. The credit ends November 30 and construction and real estate groups are lobbying politicians to extend it.
Here are the highlights from this weekend’s editorials on fiscal and budget policy:
Today, the Congressional Quarterly reported that a coalition of airport authorities, port authorities, and student loan lenders is pushing Congress to extend one of the stimulus tax breaks on “private activity” municipal bonds. The stimulus exempted these bonds from the Alternative Minimum Tax (AMT) for 2009 and 2010.
The IMF has recently released its monthly World Economic Outlook, the IMF’s premier publication on the state and health of both the global economy and member country economies.
The report states that a global recovery has taken root but that it will likely be some time before employment begins to improve.
In response to high unemployment numbers, the Obama Administration is discussing the idea of a tax credit for employers that create new jobs. House Republican whip Eric Cantor demonstrated the likely broad bipartisan appeal of this type of a tax credit by saying, “There is a lot of traction for this kind of idea.
For the U.S. taxpayer, last weekend’s International Monetary Fund (IMF) meetings in Turkey were a reminder of the importance of global cooperation to tackle the economic and financial crisis. As we (hopefully) enter a new phase of economic and financial recovery, global cooperation will continue to be critical for taxpayer interests.
Saturday marked the one-year anniversary of the Troubled Asset Relief Program (TARP), established as part of the Emergency Economic Stabilization Act of 2008. Originally intended to purchase so-called “toxic-assets” and take them off of banks’ balance sheets, the $700 billion TARP program has been used by both the Bush and Obama administrations in order to help stabilize the financial sector and the economy more broadly.