How big is the Fed seigniorage tax?

It is going to be about 100 billion, the amount returned to treasury from the banker network.  Consider 20,000 small bank ranches and that comes to about 40,000 per small bank. So we can see the banking roll up as we speak.

But isn't there some magic of low rates?

No, the issue is excess reserves compared to treasuries held, the sets the seigiorage tax. That difference is determined by the number of small retail banks which would not be profitable, and the regulated bankers will pay the tax for others.

Flat earthers will lie about the effect, do not listen. Powell's plot is to sacrifice the retail banking system in favor of Treasury, and he will succeed. What Powell is clueless about is the time needed to reconstruct the banking network, there is no time. The last recession cycle never completely solved the problem and it has reared its ugly head way before covid in the repo madness episode. We had about two years of normalcy in the previous cycle.

Krugman manages tiny clue:

Small-business lending is a mess. But Congress did much more than people realize to help the unemployed, which is something those agitating for early opening should acknowledge

Right. The Fed tax harms retail banking. It is not going to recover in two years, retail banking is tied to sales taxes and sales taxes are tied to local municipal income. Local municipal income is tied to California pension payments and obviously this is going to take years to sort out. It took us four years to restore the California public sector, and it was only really stable for two years before service cuts began, well before covid.. We will need at least seven years this time around.

And, of course, when retail banking rolls up savers put money into long term, large corporations for safe keeping, so wealth concentrates and stock markets become less liquid.

Notice me doing Bar Delong's job?  Newsom is frigged and Delong refuses to do any research that might help.  I say give his department another 10% cut.