Amidst the fury of the late-2008 banking panic, Congress created a special bank bailout program called the Transaction Account Guarantee, or TAG for short. In brief, it extends a taxpayer guarantee on all deposits, without any limit — in contrast to FDIC insurance, which covers only the first $250,000 of any person’s deposits, and which banks cover (theoretically, at least) through fees.
The 2010 Dodd-Frank bill, which Obama claims was a broadside to the banks, extended TAG for two years.
So, in 20 days, TAG expires. As you would expect, the American Bankers Association is lobbying hard to extend it for another two years — who wouldn’t want taxpayers bearing their risk?
The administration isn’t gung-ho on the extension, but Senate Democrats are. Harry Reid is holding a vote today on extending TAG. A bunch of free-market and conservative groups have joined a coalition opposing TAG extension.
Watch the vote this afternoon — currently scheduled around 2 pm. You’ll see most Democrats don’t really mind bank bailouts. You’ll also see how Republicans vote when given a choice between free markets and big banks.