Tuesday, September 22, 2009

BABs take from you and subsidize states

Fifty billion more U. S. taxpayer dollars thrown out to control states.  Build America Bonds, ("BABs") from the Obama administration's toothless "stimulus" shuts U. S. municipalities from the tax-free bond markets, but hands them subsidies on their interest rates.  And obligates the central government and gives it more and more power.  Mandates will be coming, mark my words.  But for now capital improvements ("earmarks?") subsidize state and local governments through a 35% federal tax subsidy, transferring their interest payments in part to taxpayers all over the country.  $27 billion had been sold by the first of September, with Texas and California accounting for just under half the issuances.  Democratic-controlled California desperately needs the help.  More to come for the unexpected consequences of another wild idea from Franklin Delano Obama.

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