admin
Congress is now weighing the Main Street Depositor Protection Act (S.2999), a bipartisan bill introduced on November 3, 2025 by Senators Bill Hagerty and Angela Alsobrooks that would expand FDIC coverage to as much as $10 million for noninterest-bearing transaction accounts. What is being billed as a shield for small business payroll accounts is actually a sweeping change to the foundation of deposit insurance—and it deserves fierce scrutiny from anyone who cares about taxpayers and free markets.
Steve Forbes and other conservative critics are right to sound the alarm: this proposal hands an enormous subsidy to corporate treasuries and removes vital market discipline that keeps banks honest. When you guarantee multimillion-dollar accounts, sophisticated depositors stop watching the books and banks start taking outsized risks because they expect government backstops. That kind of moral hazard concentrates upside for bankers and downside for the American taxpayer.
Supporters, including the Independent Community Bankers of America, frame the bill as a way to stabilize community and regional banks and protect local lending. But that line is dangerous spin—organizations like the National Taxpayers Union warn the legislation effectively picks winners and losers in the banking sector and shifts risk onto ordinary Americans who will ultimately pay the bill. Legislating favoritism for certain banks or accounts is not conservative reform; it is Washington meddling dressed up as compassion.
The arithmetic undermines the “Main Street” sales pitch: more than 99 percent of deposit accounts are already covered by the current $250,000 FDIC cap, so a jump to $10 million scarcely helps the typical household or small business. This is plainly a transfer of federal protection toward large corporations and institutional depositors, not a safety net for ordinary Americans struggling to save. If your goal is to protect Main Street, there are better, targeted ways to do it than to foot the bill for corporate cash management.
Worse, this proposal would weaken discipline that prevents reckless banking. The memory of the 2023 failures and the emergency actions that followed should caution us, not be used as cover to expand permanent guarantees; temporary crisis interventions do not justify rewriting the rules to invite future crises. Once depositors believe the government will always step in, accountability evaporates and the taxpayer becomes the ultimate underwriter of other people’s bets.
Proponents also ignore the hidden costs: expanded guarantees will push up the FDIC’s obligations, driving higher premiums, nudging banks toward riskier balance-sheet choices, and ultimately increasing borrowing costs for consumers and small businesses. Private-sector tools—reciprocal deposit networks, sweep arrangements, and other market solutions—exist to manage large balances without socializing losses; conservatives should insist on market-based fixes, not broader federal guarantees.
Patriots who love limited government should oppose this bill in no uncertain terms. We need tougher market accountability, not a Washington-sized safety net that rewards recklessness and picks favored institutions. Tell your representatives you want policies that protect Main Street without handing corporate America a taxpayer-funded blank check.
