Tax Dollars Provide Most Of Big Bank Profit

A new report from Bloomberg News (a conservative, business-oriented news organization) should infuriate tax-paying Americans. We know that after being bailed out by the American taxpayers, the big Wall Street banks went right back to business as usual -- reporting huge profits and passing out obscenely large bonuses to their executives (in addition to outrageously large salaries).

But it turns out that they're not really as profitable as they claim -- at least not on their own. They depend on government subsidies (taxpayer money) for most of their profit, and without those subsidies they would be making very little in profit (and some would even be losing money).

The chart above illustrates what Bloomberg News found. Over the last 10 years, the five biggest banks (the ones we bailed out because they were "too big to fail") those banks together averaged about $68.89 billion in profit. But in that same period, they averaged about $63.51 billion in government subsidies. In other words, the government subsidies accounted for 92.19% of the profit reported by these five giant banks.

Is this what taxpayer money should be going to -- to subsidize the investor profits and pay for the enormous bonuses of Wall Street bankers? Remember, these are the same Wall Street banks that triggered the recession through their mismanagement and malfeasance. Now they are whining about government regulation while playing the same old financial games -- and doing it with taxpayer money!

Making matters even worse, these banks dole out hundreds of millions of dollars to lobby Congress to keep those government subsidies that keep them profitable, while calling for cuts to Medicare and Social Security and social programs that help hurting Americans. They have no problem with corporate welfare (and that's exactly what those subsidies are), but oppose government spending to help unemployed and poor Americans keep their heads above water -- and to honor the contract made with elderly Americans regarding Social Security and Medicare.

And the Republicans are playing their nasty game. They want to privatize Social Security and Medicare (or at least cut benefits for both), and cut funds to help hurting Americans -- while deregulating Wall Street, continuing those subsidies for the giant banks (and other corporations), and trying to give the rich even bigger tax cuts.

How much longer are we going to put up with this nonsense?