Yor Doin It Wrong

Chuck Schumer is not happy about the AIG bonuses. Neither am I, but I don't command a bully pulpit and, perhaps if I did I wouldn't use it to make threats. On the senate floor today he invited AIG bonus recipients to return the money, adding, "If you don't return it on your own we will do it for you." How? Taxes:

Rep. Gary Peters (D-Michigan) submitted a bill yesterday which would implement a
60% tax rate on all bonuses about $10 thousand, targeting employees of firms in
which the U.S. government holds an equity stake greater than 79 percent. The
bill is clearly aimed at the excesses of AIG, but is believed to avoid rejection
as a “bill of attainder” since the bill covers any firm in which the government
may hold nearly 80 percent or more ownership stake. Given the current conditions
within the financial industry, it’s not a stretch to imagine other large banks
fitting similar conditions if their liquidity does not improve.

I mean, sure it covers *all* companies in which the government holds an over 80% stake. All one of them. Does that really get you around equal protection?


bachrach44 said...

It is a little unfair to target AIG that way (I mean, why not make the bill apply to any company who name is a three letter acronym at that rate). The solution is to make it more expansive - any company that takes bailout money should have all their bonuses in excess of 5K taxed at 95%. You want our money, you take our conditions. If you don't like them, go bankrupt.

David said...

This is of course a great example of why some of us have been against all of these bailouts and other stimuli from the beginning. "Moral hazzard" doesn't begin to cover the concept of where we find ourselves here. Heck, we've got more hazzard than Bo and Luke Duke...