Can this really be constitutional? Can you write a tax law so narrowly defined that it singles out a handful of people? The article mentions ‘greenmail’ taxes, but that’s applied against a certain behavior, and applies across the economy. This seems to be much more narrowly targeted:
First, for the bill to stop these bonuses, which are for actions taken in 2008, it would have to be a retroactive tax. Is that fair? Is it legal? I know very little about U.S. tax law, but if I were a regional sales manager for AIG, and most of my income came from bonuses, and I planned my life around them and then because my bosses took a bailout these yahoos decided that my own money was forfeit, I’d be hopping mad.
If this is constitutional, what’s to stop Congress from passing a 100% tax, say, on the incomes of people who make more than 5 million dollars per year from talk-radio advertising revenue and who also weigh more than 250 pounds?
Larry Tribe seems to think so: http://business.theatlantic.com/2009/03/laurence_tribe_is_taxing_aig_legal.php. As long as it’s non-punitive and not “political retribution” the legislature can be pretty narrow in defining tax policy. I’m pretty sure that the initial top income tax bracket only applied to a handful of people.
Well, a talk-radio tax would seem to fall afoul of the “political retribution” aspect that Tribe mentions (since your example targets only one political ideology). I don’t think we can make the same blanket political claim about all AIG bonus-getters.
None of this is to say it’s a particularly good idea. In fact, I tend to think these sorts of knee-jerk populism are bad ideas. But, the mob has spoken…
The talk radio analogy is flawed because that does not involve people who received their income from the taxpayers in the first place. The bill in question only involves companies that are paying bonuses with taxpayer money.
I don’t think it’s ex-post-facto because it’s a tax, not a criminal law. It’s also something that’s been done before. I say good. I’m not crying in my beer for these cocksuckers.
Ex post facto means that if you declare something illegal today, you can’t prosecute someone for doing that illegal thing before it was made illegal. Not much there relevant to tax policy.
That refers to making something a crime retroactively. They are not creating a crime they are simply implementing tax policy. Personally I think it should be 110% just because they had the balls to try to rip off more taxpayer money. Maybe someday we will get the message out that there will be costs for getting caught with your snout in the public trough. I don’t give two shits about preexisting contracts. They are in bankruptcy in all but name and bankruptcy court would have laughed at requests for bonuses.
Man, whether it’s constitutional or not, it is an incredibly bad idea, even from the standpoint of the Democrats trying to achieve their own goals. If they are trying to get banks and other companies to come forward and seek government help if they are failing, this is almost guaranteed to put an end to that.
And with the attacks Liddy at Treasury is taking from these clowns, is it any wonder that Geithner can’t find quality people to fill his vacancies?
No wonder Congress has a 19% approval rating. These idiots aren’t fit to govern a dog show let alone a country.
And in the credit where credit is due dept: Charles Rangel came out against this, saying it smacks too much of political retribution. Good for him.
I think we’re seeing just the start of this nonsense. Wait until the bidding scandals and corruption scandals start flying due to the hastily-written stimulus package. There are already controversies brewing - cities are trading away their stimulus for hard cash at steep discount rates - a side effect the administration never counted on. It’s going to get worse.
Read the bit that James Madison wrote that I quoted. Certainly seemed their intention was to cover contracts as well and this tax explicitly seeks to undo a legally formed (if shitty) contract.
Do you really think Americans are sympathetic to these AIG scumbags. This is a GREAT political move. Fuck those assholes. It should be 100%. It’s easy for you to be flip about it, you’re not a US taxpayer.
I agree it will put a chill on the banks having themselves saved. On the other hand, logically, you don’t want them to do it if they don’t need to, and you don’t want the persons who made the bad decisions to actually profit personally from their foolishness. It’s a bad law, but the bailout was given in good faith with the assumption that .the parties receiving the money would understand that having a job after what has happened is what they should shoot for. Getting a bonus would be out of the question. In retrospect, the bailout money should have had TONS of restrictions coming with it. It’s too late for that, so what you get is this.