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Kucinich Panel to Investigate Citigroup Tax Ruling
Rep. Dennis J. Kucinich (D-Ohio) called Treasury's action a "farce" and an "outrage" during a hearing Thursday of the domestic policy subcommittee of the House Committee on Oversight and Government Reform. Kucinich, the subcommittee chairman, said that he would demand an explanation from Treasury officials.
Rep. Dennis Kucinich (D-Ohio), chairman of a subcommittee on domestic policy, called the ruling a "farce" and an "outrage." (Joshua Roberts/bloomberg News) "This committee is not going to rest until we've examined this last deal threadbare, until we have spoken to every individual associated with it, examined every communication related to it, with every person that may have had an interest in it, or who may have had some kind of a channel of influence," Kucinich said.
The Internal Revenue Service, an arm of Treasury, ruled last Friday that Citigroup could keep $38 billion in tax breaks that otherwise would decline in value as the government sells its stake in the company. Federal law lets companies shelter profits from taxes in good years based on the amount of losses in previous bad years. But the law restricts the use of past losses if a company changes hands, to discourage profitable companies from buying unprofitable firms to avoid paying taxes.
Treasury's plan to sell its $25 billion stake in Citigroup would have qualified as a change of ownership under the law. The sale was postponed Wednesday after Citigroup's stock plunged in value, but Treasury officials said they still planned to sell the government's shares over the next year.
Treasury officials said the government needed to grant the tax break in order to sell its shares in Citigroup because the company could not afford the loss. Officials also said that preserving the tax break would help the government sell its shares at a higher price. And they said the law was never intended to apply to deals involving the government.
Kucinich tore into that logic Thursday, questioning why the government needed to sell its shares immediately. He said that the government was inherently conflicted by its roles as a tax collector and as a shareholder in the company. He said it appeared that the shareholders had gotten the upper hand.
"This does a disservice to the taxpayers, it does not help the taxpayers recover the value of their investment and it raises troubling questions about how the administration is negotiating its role," Kucinich said in an interview Thursday.
Kucinich also said that he planned to investigate whether the IRS had the legal authority to issue the ruling that benefited Citigroup.
"The idea that the government is using its authority to pick winners and losers is very dangerous," Kucinich said.
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27 Comments so far
Show AllGood step.
Now leave the Democratic Party.
I'm also waiting for a Kucinich or a Bernie Sanders to state plainly that the federal government is awash in fraud and that massive non-compliance and civil disobedience would be well justified.
Why should the rest of us pay our taxes if the fix is in?
DON'T PAY! It IS that simple. However as someone once commentsd: They will just print MORE useless green paper as they need it.
There should be NO DOUBT who TRUE Progressives must get behind for Prez next go 'round. Follow that up with some SERIOUS voting for Progressives during mid-term elections and we MAY stand a shot!
Think of D.K. as OUR "insider".
nonsense. Perhaps you'd care to share your math? How do you know how much value shares will lose because the company's tax liability increases somewhat? You're simply guessing without a shred of evidence that share price will plummet catasrophically just because they have to pay their fair share of taxes like everyone else. You're full of it.
Then they should go down the plughole. Fair's fair. 85% of their stock, approximately, is owned by the über-wealthy, who can damned well afford to take the hit.
Of course, the fact that 85% of their stock is owned by the über-wealthy is the reason why they *won't* have to take the hit, tho of course that won't be mentioned and will be denied if mooted.
Not even slightly.
jm, it comes to a point where the %25 need to cash their chips and get out the casino. This means no longer investing in stocks through your 401k, or IRA. Maybe invest in gold, instead. We have to cease giving the bankers leverage against us. Sometimes, you have to be willing to give up in order to gain. I believe this is one of those instances.
burn the stocks and disband the corporations
better in long run
workers get paid for their labor
save your nose
damn right revo. so many people here think that they are
taking a stand against something when in fact they are
agreeing with the ruling elite. they say pink so these
folks say blue but blue was the color intended. hope
these bastards end up in the pokey with as frank
zappa once said plenty of meat in the seat!
it's not a racket science
if the shares loosing the values, the market gains the same amount, along the government that should uses those billions instead, to buy the rest of the gang posesion
edweg
If Kucinich comes close to threatening citigroup, won't they simply cite "executive privilege"? After all, aren't many of them current or former Obama/Clinton advisors and cabinet members?
If that fails they can fall back on the "state secrets" defence(You don't want Al Queda learning the inner workings of wall street). LOL
If on the slim chance evidence isn't lost like the 22 million Bush emails, and an honest judge can be found who doesn't just dismiss the case on the president's say-so, and someone at citigroup is convicted, won't the Democrats simply parden them?
It'll never happen until Americans revolt against this system and find a better way that is based on equality and justice--and before that will happen there needs to be peace. It could take some time and lots of dedicated anger against the wicked that rule presently.
you have it backwards
peace will come after
"Kucinich also said that he planned to investigate whether the IRS had the legal authority to issue the ruling that benefited Citigroup."
Go Dennis!
Dennis Kucinich always takes the side of the weak against the strong.
He can be depended upon to expose the truth and hold the powerful responsible for stealing from the people.
Support Dennis now, do not wait for a declaration to run for President.
Support him now.
Who the hell is the Treasury to change a law? It is written in the Constitution of the United States of America that "Congress" writes the laws - not the effing Treasury!
".....the tumbling of the Glass Steagal laws (separating banking, insurance and investment companies) that were repealed when Citigroup merged with Travelers Insurance in the late 90’s have really shown the wisdom in those lessons from the great depression. The financial industry today threatens the banking industry as it did then.
Merrill Lynch, Citibank and their brethren around the world are going hat in hand around the globe looking for cash infusions to avoid insolvency and bolster their tissue paper reserves." ....this quote is from 2 years ago! Do you think anything has changed?
“Those candidates who actually challenge the corrupt system which now masquerades as a representative democracy have been marginalized. Ron Paul on the right and Dennis Kucinich on the left represent the best of the two opposing political polarities.” - Daryl Schoon
http://news.goldseek.com/GoldSeek/1217430000.php
Bureaucrats love to fix problems they can't fix and make promises they can't keep.
This country is morally and financially bankrupt!
I recently got an email from a conservative website about a 2nd Revolution. I guess some are gearing-up for it since our "representatives" are not representing us.
jm:
Please explain "administrative law".
I don't know the specifics regarding the Treasury that the writer alludes to, but "administrative law" emerges because legislators creating and funding government agencies delegate authority to the agencies' administrators to develop rules, policies, processes, etc.
That is, legislators don't spell out in detail exactly how day-to-day operations will be run; instead, the agency administrators have independent authority and discretion to establish and modify legal standards and requirements in accordance with the spirit and intent of the enabling legislation.
There are feedback loops: egregiously unfair or oppressive policies can generate negative feedback to the legislature that results in revised and amended law correcting the problematic policy; more commonly, agencies are taken to court by aggrieved parties to test the legality and constitutionality of the disputed law.
Courts may overrule administrators-- or perhaps it's better to say that administrators (e.g. Secretaries) are bound to respect court decisions requiring abolition or modification to administrative law deemed legally unjustified or unconstitutional.
But betwixt and between, there are vast numbers of laws, or at least legally enforceable restrictions and allowances, that are not written by legislators or duly voted upon.
· Yr Obd't Servant
Thanks for explaining that, OS. The term now makes sense.
"Treasury's plan to sell its $25 billion stake in Citigroup would have qualified as a change of ownership under the law."
According to Inner City Press http://www.innercitypress.org/citi.html, the government has a stake of $45 billion in Citigroup. Did they already sell off $20 billion?
What's the deal?
Gotta love a guy with guts. Contrast to BO whose self-conscious seriousness, artificial ease, and ersatz air of authority do not ring true. To me he seems unsure and afraid underneath. Dennis has courage. AND he shares the same reality and values I do. {hugs to DK}
Taxation without representation! If congress doesn't respect the wishes of the (majority)
electorate, and responds mainly to corporate interests, then they should be fired.
Elections are clearly ineffective as a means of change (lesser of 2 evils) the only non-
violent way to effect change is to not pay taxes, in a real sense you are telling
congress that they are fired.
Unless we can get proportional representation, instant run off voting, and/or "non of
the above" on the ballot, or public financing of elections, we will have the more
of the same (excepting DK, Bernie Sanders, and a few others).
Democracy can only function with the consent of the governed, but how can the governed
remove their consent non-violently ?
One cannot "remove" consent, violently or non-violently. This is why it is so important to be well-informed prior to giving consent in the first place. A lack of confidence in the reasoning skills and logistic means to voice their will were prime motives for the "founding fathers" (I grow weary of that term...) to devise the electoral college.
Given the willingness of today's mindless masses to be duped and doped by the media, I often wonder if they were right.
Nevertheless, your question does raise an interesting issue: I firmly believe the public needs at its disposal more--and stronger, legitimate, legal--means by which to express disapproval of the actions of their elected officials. They do work for us, after all: why can't we more easily fire them when they screw up, or exert pressure to "promote" them to higher responsibilities in the cases of "DK, Bernie Sanders, and a few others"?
For example: I'm from Wisconsin (although currently living as an ex-pat) so I'd love to be able to rally NATIONAL support around Feingold to give him more say in things: I genuinely think he's been an exemplary "employee" of mine. Conversely, Lieberman (I-Insurance) has made a total rectum of himself on behalf of not only the people of his state, but our nation as a whole. Why can't a Wisconsinite do something to get his professional (as in..."the oldest profession") backside properly booted out of power?
Oh yeah...we're a federation. I forgot. Seemed more like an empire of late. How about a non-violent war against the voters of Montana and Connecticut?
If you don't ask yourself why, you know nothing.
Even good ole Dennis needs to have a hobby like, say, investigating Citigroup's tax ruling