WASHINGTON (December 10, 2012)—Four years ago Congress expanded government insurance for certain bank deposits to include totals above the usual $250,000 limit, hoping to prevent a possible run on banks at the height of the financial crisis.
That limit is about to be re-imposed, and community banks fear they'll lose their depositors to bigger banks and want Congress to come to their rescue.
Conservatives, among others, are opposed, however.
They say the Transaction Account Guarantee program is no longer needed and discourages the wealthy from investing in the economy.
The program expires at the end of this year.
Senate legislation to extend it for another two years comes up for a test vote this week, but even if it passes the Senate, the legislation faces opposition in the GOP-controlled House.