Monday, February 9, 2009

Fuzzy Math strikes again

There is the most absurd piece of information reported in the NY Times today.

It's about the unexpected impact of establishing salary caps on executives at firms receiving TARP funds:

"According to the latest cost estimate of the economic stimulus bill by the Congressional Budget Office, Uncle Sam will lose $10.8 billion in tax revenue that otherwise would have been paid by high-rolling Wall Street executives."

I'd really like to know how the CBO determined that figure. The assertion that the Wall Street bigwigs were handing over 10 bil to the feds in income tax prior to the crash seems absurd.

And it's also a ridiculous figure to toss around because the money they would have been using to pay themselves the salaries need to pony up such astronomical taxes actually would have come from tax revenues.

So heads they win, tails we lose.

I'll take the caps on salaries paid to federally funded CEOs over the income tax received on those same federally funded salaries any day.

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