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| House passes bill taxing AIG and other bonuses |
| 2009-03-20 |
| Denouncing a "squandering of the people's money," lawmakers voted decisively Thursday to impose a 90 percent tax on millions of dollars in employee bonuses paid by troubled insurance giant AIG and other bailed-out companies. The House vote was 328-93. Similar legislation has been introduced in the Senate and President Barack Obama quickly signaled general support for the concept. "I look forward to receiving a final product that will serve as a strong signal to the executives who run these firms that such compensation will not be tolerated," the president said in a statement. House Speaker Nancy Pelosi, D-Calif, told colleagues, "We want our money back now for the taxpayers. It isn't that complicated." The outcome may not have been complicated. But the lopsided vote failed to reflect the contentious political battle that preceded it. Republicans took Democrats to task for rushing to tax AIG bonuses worth an estimated $165 million after the majority party stripped from last month's economic stimulus bill a provision that could have banned such payouts. "This political circus that's going on here today with this bill is not getting to the bottom of the questions of who knew what and when did they know it," said House Republican Leader John Boehner of Ohio. He voted "no," but 85 fellow Republicans joined 243 Democrats in voting "yes." It was opposed by six Democrats and 87 Republicans. The bill would impose a 90 percent tax on bonuses given to employees with family incomes above $250,000 at American International Group and other companies that have received at least $5 billion in government bailout money. It would apply to any such bonuses issued since Dec. 31. The House vote, after just 40 minutes of debate, showed how quickly Congress can act when the political will is there. It was only this past weekend that the bailed-out insurance giant paid bonuses totaling $165 million to employees, including traders in the Financial Products unit that nearly brought about AIG's collapse. AIG has received $182.5 billion in federal bailout money and is now 80 percent government-owned. Most of these firms are headquartered in New York City. 90% fed + 8.14% state + 4% city = 102.14% income tax rate My eyes are watering. Can't decide if from laughter or crying. Best Congress that money can buy? Not even close. |
| Posted by:ed |
| #16 "Washington, DC has become a Superfund Site, for toxic finances." Well, the Bambians want to reinstitute "polluter pays" laws/rules, AP. Perhaps they should start with the Congressional and Administration clowns responsible for this toxic mess.... |
| Posted by: Barbara Skolaut 2009-03-20 22:41 |
| #15 Washington, DC has become a Superfund Site, for toxic finances. so to speak, in a perverted way..... |
| Posted by: Alaska Paul 2009-03-20 22:31 |
| #14 My daughter and son-in-law have automobile insurance through AIG. Guess what? They can't find anyone to continue making payments to. The local office is closed - there's no one there. Their telephone calls go unanswered. Their letters and payments are returned to them. They finally broke down and went with someone else. All the problems with AIG are NOT in the corporate offices. All the LEGISLATIVE problems of the Obambi administration aren't necessarily in Congress, either. Washington DC needs to be declared a disaster area and totally evacuated - at rifle-point if necessary. |
| Posted by: Old Patriot 2009-03-20 20:32 |
| #13 "AIG has received $182.5 billion in federal bailout money and is now 80 percent government-owned." Hmmm . . . remember what I said about deconstructing the financial sector? Bringing all under government control? OBAMA: "I look forward to receiving a final product that will serve as a strong signal to the executives who run these firms that such compensation will not be tolerated," the president said in a statement. Not "tolerated?" Government is now setting salaries. Obama is moving in to kill the private sector, and to render helpless those who have the smarts and ability to oppose him. It is a very personal attack on private citizens, but serves to confuse the real aim by whistle-blowing against "corruption." He wants to turn most Americans against corporate business, so he can take over corporate businesses. The AIG thing is just a smoke screen for doing that--"See . . . the government HAS to take over and regulate these out of control BIG (BAD) BUSINESSES." They knew about the bonuses before because they were contracted for more than a year ago. It's a set up. And it's working. People are attacking and victimizing the people they think are responsible for the economy--just like Obama wants them to. Oh, but forgot to mention that 100% of bailouts are going to the top 1% of companies that contributed to the Obama campaign. The original AIG guys are long gone. Long before they agreed that Obama could use their company as an example. The "Chilling Effect" this taxing and demonizing of business has on people is part of the deconstructionist design. Who's going to want to go into business now? Hmmm? 90 percent tax ? After the fact? Unconstitutional. But who cares about a constitution. Barak's in charge now--Suharto style. |
| Posted by: ex-lib 2009-03-20 19:20 |
| #12 Well, the 52'ers got the government they deserve. To bad the rest of us have to suffer along with 'em. |
| Posted by: DarthVader 2009-03-20 16:19 |
| #11 The course of action this Congress needs to pursue in the best interests of the country is clear: it needs to go home. Adjourn, quit, desist. If it feels obliged to remain in session, it ought to limit its activites to things within its competence, such as naming federal buildings after Robert C. Byrd or passing resolutions observing that the sky is blue. Maybe the occasional luncheon. |
| Posted by: Matt 2009-03-20 15:06 |
| #10 That's the way to do it, SUE. |
| Posted by: Redneck Jim 2009-03-20 13:51 |
| #9 Denver Post... Legality of bailout bonus tax questioned The move in Congress to heavily tax bonus payments at companies receiving federal bailout money could face legal challenges and political fallout, experts said Thursday. Opponents of the bill could mount a fight on the grounds that the legislation violates due process and other constitutional aspects of taxation, said Denver attorney Dirk de Roos, a business and civil litigator at Faegre & Benson. "The tax lawyers will have a field day with this," he said. "It seems to me to be way off base and a questionable legal approach." The bill was approved Thursday by a wide margin in the U.S. House. It would impose a 90 percent tax on bonuses given to employees with family incomes above $250,000 at banking giant AIG and other companies that have received at least $5 billion in government bailout money. De Roos said that because the federal government now owns 80 percent of AIG, it should exert its legal rights as a shareholder by filing suit if it believes the bonus payments are improper instead of imposing a legally questionable tax. "It seems to me that Congress is posturing and playing to its audience," de Roos said. ". . . It's almost as if judgment has been suspended in Congress, and they're just rushing to do something." Legal experts are divided on whether the bill violates provisions in the Constitution that forbid laws aimed at individuals or small groups. Robert Willens, a corporate tax lawyer in New York, said there is plenty of precedent for imposing punitive taxes on behavior that lawmakers find objectionable. He cited the steep excise taxes levied on money paid to firms to keep them from launching hostile takeover bids. "You can write very narrowly tailored laws," Willens said. However, University of Denver accounting professor Richard Leaman said he believes the bill "is pretty darn close" to violating the Constitution. "High tax rates are OK, but confiscation is illegal under the Fifth Amendment," he said. University of Colorado associate law professor Michael Waggoner said the legislation could cause more problems politically than legally. "If they start using the tax code to punish people, it may look good now," he said, "but six months from now, it may not look so good." |
| Posted by: tu3031 2009-03-20 12:40 |
| #8 Mrs. Uluque6305 had to drag me out to the backyard to keep me from throwing my glass of scotch at the TV last night when they started talking about this because the hypocrisy of these congress critters is so blatant. How stupid do they think we are? Even in San Francisco, are they really so stupid that they can't see what a sham this is? |
| Posted by: Ebbang Uluque6305 2009-03-20 12:26 |
| #7 We want our money back now for the taxpayers. Aha! Pronoun trouble... |
| Posted by: mojo 2009-03-20 11:19 |
| #6 I'd like to see how they are going to enforce this tax on all the executives that are British, Belgian, French and Luxembourg's. As I understand it most of the higher bonus amounts went to the guys who worked in The City (London) not in Danbury. |
| Posted by: Jack is Back! 2009-03-20 11:04 |
| #5 From what I read earlier the people most responsible for AIG are long gone. Liddy was brought in with a new COO to try and fix the disaster that was in the Financial Products Division. The people that are getting the bonuses were the least culpable. They are the ones trying to unwind the collossal mess. Supposedly they have said, privately, that if this s**t continues they will take the money they've gotten and resign since their contracts would be voided. They could then sign on with the counter parties to all the remaining instruments and help them figure out how to screw what's left of AIG. This strikes me as similar to wanting to punish all the players on a football team after you've chased away all the bad execs and coaches. If you expect to compete at all you have to keep a few people that know where the key to the bathroom is. PS apparently some of those retention bonuses went to janitors, cafeteria and the like so that the place could at least keep running. |
| Posted by: AlanC 2009-03-20 10:13 |
| #4 May well be a Bill of Attainder. We'll see. But if I were one of those AIG people who had been persuaded to stay on and help wind the company down in an orderly way, or if I were someone brought in by the government recently to help with the same, my response would be a simple one: I quit. Today. And my last act would be this on my office PC: 'Delete C:*.*' |
| Posted by: Steve White 2009-03-20 09:02 |
| #3 ..and Congressional pay for the years 2009-10. |
| Posted by: Procopius2k 2009-03-20 08:59 |
| #2 Don't worry Congresscritters, when you lose power, the next team will pass a 95% retroactive tax on all Congressional retirements. |
| Posted by: Procopius2k 2009-03-20 08:57 |
| #1 Ex post facto taxing? What a wonderful method of encouraging folks to go out and spend what little money they do have. Wrong signal, a very wrong signal. |
| Posted by: Besoeker 2009-03-20 07:41 |