The Mythical FDIC Fund

Just like most government funds (ie. Social Security), the FDIC "fund," which has charged banks billions of dollars in premiums over the past decade to insure against a possible downturn, is not a fund at all. As explained by former FDIC chairman William Isaac, the FDIC gives its reserve fund to the Treasury each year, which is then used for general government funds.

What this means is that the FDIC holds only an IOU from the government - and therefore taxes ( and/or premiums charged to banks) need to be raised dramatically in order to cover the actual funds that need to be paid to insured depositors.