The tax law is very clear. These tax benefits are illegal. The only tax lawyers who think otherwise are those who represent the big banks taking advantage of the overthrow of this law by executive fiat.

What this has meant is that in recent takeovers, the purchaser has been able to buy their target bank for free; the tax benefits come out to equal the stock or cash the bank is using to purchase their competitor. Which means, of course, that you and I are paying for these purchases as the Treasury is now $140 billion poorer by this giveaway.

Your link, by the way, does not go back to the original Washington Post article, but to the Agonist front page. There is a delicious quote at the end of the article by a tax lawyer who decries the Democrats with spines of "spaghetti", and points out this is just like 9/11 where a crisis was used to roll over Congress.

To complete its transition to a rubber-stamping puppet show, I propose that all Congressmen be required to wear togas. They might as well be seen for the tools they really are under the imperial presidency.

The Wall Street bailout looks a lot like Iraq — a "free-fraud zone" where private contractors cash in on the mess they helped create.

Rolling Stone, By Naomi Klein, Nov 13

On October 13th, when the U.S. Treasury Department announced the team of "seasoned financial veterans" that will be handling the $700 billion bailout of Wall Street, one name jumped out: Reuben Jeffery III, who was initially tapped to serve as chief investment officer for the massive new program.

On the surface, Jeffery looks like a classic Bush appointment. Like Treasury Secretary Henry Paulson, he's an alum of Goldman Sachs, having worked on Wall Street for 18 years. And as chairman of the Commodity Futures Trading Commission from 2005 to 2007, he proudly advocated "flexibility" in regulation — a laissez-faire approach that failed to rein in the high-risk trading at the heart of the meltdown.

Bankers watching bankers, regulators who don't believe in regulating — that's all standard fare for the Bush crew. What's most striking about Jeffery's résumé, however, is an item omitted when his new job was announced: He served as executive director of Paul Bremer's infamous Coalition Provisional Authority in Baghdad, during the early days of the Iraq War. Part of his job was to hire civilian staff, which made him an integral part of the partisan machine that filled the Green Zone with Young Republicans, investment bankers and Dick Cheney interns. Qualifications weren't a big issue back then, because the staff's main function was to hand over stacks of taxpayer money to private contractors, who were the ones actually running the occupation. It was this nonstop cash conveyor belt that earned the Green Zone a reputation, in the words of one CPA official, as "a free-fraud zone." During Senate hearings last year, when Jeffery was asked what he had learned from his experience at the CPA, he said he thought that contracts should be handed out with more "speed and flexibility" — the same philosophy he cited back when he was in charge of regulating Wall Street traders.

The Bush Administration has since reversed the Jeffery appointment, perhaps thinking better of giving a CPA alum such a central role in the Wall Street bailout...