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Via America’s Lawyer: Mike Papantonio and Farron Cousins explain how the Treasury Department is working on reclassifying banks in America to allow them access to additional corporate tax cuts that would Net them nearly $2.5 billion dollars.
Mike Papantonio: The Treasury Department is working on reclassifying banks in America to allow access to additional corporate tax cuts. That would net these people about $2.5 billion. Now, here it is. In order for this to happen, you have to say that a bank is not involved in financial transactions. That’s where they had to go. Am I making that up, first of all?
Farron Cousins: No.
Mike Papantonio: Okay. Second of all, this is something that is being pushed by Mnuchin. I call him Mnuchin the Munchkin. Now, to know who Mnuchin the Munchkin is, this is a guy that if you’ll recall, in foreclosures became a gazillionaire foreclosing on people and working every kind of scam imaginable on poor people. Right? So now we have Trump is backing this bill that says, “Well, you know … ”
They call it the Corker Kickback because it’s also originating from Senator Bob Corker. It’s the Corker Kickback Bill, but it says in order to give banks a bigger tax break, we had to classify them as being an entity that’s not involved in financial transactions. Take it from there.
Farron Cousins: Well this started with the Republican tax cut package that they drafted and passed the end of last year. There’s a thing called pass-through income. They created this little loophole to where if you’re an LLC or and S Corp, you can have what’s called pass-through income. You get an additional tax break because of that, on top of everything else you’ve already got.
Well, banks wanted that. They’re classified as such. So in order to give the appearance that they weren’t giving kickbacks to their buddies, they said, “Okay, banks, if you provide financial services, you don’t get this loophole.” So Mnuchin came out about a week or so ago, and he says, “Hey, banks don’t provide financial services. I’m going to draft a rule through the Department of the Treasury, which does not have to go through Congress, does not have to be approved by anybody but me, Steve Mnuchin, and I am telling you that banks do not provide financial services and therefore they should get that $2.5 billion tax break.”
Mike Papantonio: Okay, I looked through this like I always do, and I try to find, is there any rational basis for saying that a bank is not involved in financial transactions? I looked, and I read, and I reread this bill. Take a look. Did you see any way to justify that a bank is not involved in financial transactions, therefore we can give them a higher income tax break? If they’re an S Corporation, if they’re an LLC, or if they’re a partnership, this pass-through income is going to benefit them. Did you see any indication at all that says, “We’re changing the definition of a financial institution because … ”
Farron Cousins: No. And David Sirota, who actually wrote the story, uncovered it, he had gone through all of the fine print of this new Treasury rule, and he could not come up with anything that would indicate that banks aren’t engaged in financial services. And what Mnuchin is trying to say is that, “No, no, no. Financial services just means if you’re some kind of financial advisor, you tell people what to do with their money. Banks, even though you give them your money, you get money from them, that would be technically a financial service, but it’s not the kind of financial services that the tax bill talked about.”
Mike Papantonio: Most interesting about this, there were no hearings on it.
Farron Cousins: Right.
Mike Papantonio: You understand, there were no public hearings. This took place literally in shady back rooms with lobbyists and people like Corker and Trump’s advisors. This is another Trump relief bill, you understand?
Thanks for joining me. These stories every week, they get crazier by the minute. Thanks for being here.