White House: AIG Bonus Tax May Be ‘Dangerous’

“ANTI-FREE MARKET” COMMENT BY REP. MIKE PENSE!
Pense refered to the attempts to tax the bonus money paid out of taxpayer funds as “anti-free market” — DUH!!
We–THE TAXPAYERS–have footed two bailouts of more than 700 BILLION to keep these businesses THAT WERE GOING TO FAIL IN A FREE MARKET.
Get OUR MONEY back from these GREEDY you-know-whats!
7,000 FAMILIES could have $24,000 to live on this year with the AIG bonus ripoff.

We want money back from AIG. We want auto workers to give up their benefits. When is FSGU (Federal & State Government Union) going to give up something? How about their perks? Health benefits…why should we have to pay for their health benefits? President Obama needs to hit his own home with cuts. His wife made $300,000 last year. Why are we paying for their health care?I would like for someone to do the math of how much money do the american people pay for State and Federal Health Benefits for our Elected officials.

Watch everything George writes he likes to twist the news a lot

what a joke.
in all other industries (aside from finance apparently), if a company does poorly, it affects the entire company’s merit increases and bonuses. these banks should be no different. we should absolutely be going after ALL the bonuses given to employees of firms that received TARP money.
the argument that only divisions that were responsible for the mess should be penalized is a farce. firms have multiple divisions and products to diversify risk for the ENTIRE company. if not, the “profitable” divisions should have been spun out or should have existed as separate companies.
furthermore, it would be a great thing if smaller banks do not take TARP money if they don’t need it. think about that. what is anyone worried about that?

I suppose we could just deposit our paychecks directly into AIG’s account…

Ex post facto. They can’t pass a law then expect to punish people for breaking that law before it was even passed! Obama should know that.

The AIG bonus tax may be dangerous? HELLO! This whole Administration is the clear and present danger!!!

IF YOU’RE LOOKING FOR REAL JOURNALISM,YOU SHOULD LOG ONTO MEDIA MATTERS AND NEVER READ ANY OF THESE STUPID BLOGS AGAIN! THE REAL CULPRET IN THIS AIG MESS IS THE BUSH ADMINISTRATION; THEY WERE THE ONES WHO APPROVED THE FIRST BAILOUT OF AIG WHICH CONTAINED THESE EMPLOYEE BOUNUSES. BUT THE MAIN STREAM MEDIA INCLUDING ABC IS NOT INTERESTED IN REPORTING THOSE FACTS!

The bonuses are less than 1% of the bailout money. The big story should be where is the other 99%. Yes, I’m outraged about the bonuses, but I’m more outrage about the other 99%.

Excuse me JILL, but I think that the Democrats had already gotten their majority when that passed. Everyone came to the dance on this thing and we just need to realize that we screwed it up. Get on with it — we elected Obama because he said 1. he could do more than one thing at a time, 2. he could fix the mess, 3. he was bringing change. Now, JUST DO IT! Stop spending money you have to print because we are broke. Democrats rule now, so forget Bush – he’s gone, you won, and it is your game. So play it right or Obama will wish W were back in DC to punch around some more.

What? Where was all the concern about singling out a segment of the population for higher taxation when it was tobacco and alcohol that were and are being taxed? It’s nothing new. These bonuses are a kind of thievery called “unjustifiable compensation” under the law. It is illegal. TAKE IT BACK–IT IS OUR MONEY!
Regards, The Old Prospector

I think Obama, Todd and Barney Frank are the 3 biggest political recepients of AIG bailout money.
Will that get taxed at 90% too.

I don’t like that the government bailed out AIG. I don’t like that the people who ran AIG into the ground get millions in bonuses. However, the congress cannot single out a group and instill punishment on that group by taxing any of their money at 90%. That is unconstitutional. People need to be more concerned that CONgress is blatantly thumbing their noses at the constitution!!!!! Their job is to uphold the constitution! If they are allowed to do this, what is to stop them from taxing every American at 90%. They can’t do this!!!!!

All these politicians should give their AIG contributions back to the taxpayers before expecting employee’s to give back their bonuses.

Everyone is in an uproar about how bad of a job the government is doing yet we do nothing about it. Its time to go back to our roots where violence solved problems. Congressmen arent going to do anything for the American people unless they know their lives depended on it.

The Federal Government is the number one employer who does not provide medical insurance to some of its employees. The departments get around paying by using temps as employees. They do this by calming the job will last no longer than two to three years. The employee after this time will be terminated, wait for three months and hire another person as a temp.

It might be the “in thing” to jump all over executive pay right now….but what a slippery slope this is…..and how far are we going to move away from capitalism? What is next?…we think that baseball players make too much money….as a result I can’t get front row seats at a ball games because ticket prices are too high — that isn’t fair…..they shouldn’t be making millions — they should make less than $250,000 because we don’t want them being wealthy. And how about movie stars — come on $20 million for one movie — its hard to get to the movies every day with those ticket prices…..Of course I’m being SARCASTIC!!! No one has to like the crazy salaries or bonus payments that have been going out the door — but that doesn’t mean we should be throwing the baby out with the bathwater! Capitalism has many more pros than cons — but we shouldn’t and can’t let government get involved in the private sector because we are all pissed off at a FEW companies that behaved poorly. And in the grand scheme of things only a FEW people walked away with large sums of money. These quickly made laws will penalize thousands of GOOD people. We need to let the free market be FREE. So before you jump on this bandwagon — realize that it could be my pay or yours that the government targets next — no thank you!…………these bonus are crazy and shameful — but lets be legal about how we fix this problem and lets spend our time learning where the rest of the money we gave AIG has gone because we’re wasting time worrying about a small percentage instead of using our time learning what AIG is doing with a large percet of our money.

I have wondered often why these executives, who knew their company took bailout monies, simply did not say “no” to the bonuses, retention plan or not? Would that not have been the moral thing to do? I also wonder why it is that hard working everyday citizens must work harder and receive no bonuses for their sacrifice? Actually, that is a rhetorical question since the answer is most obvious. Incompetence is rewarded while hardwork…just gets harder.

I am a Obama voter and may have missed something on this whole bonus mess? Sen Dodd on CNN said he had nothing to to with the legislation on bonuses to be paid out. 24 ours later he came out on CNN and said he had written it into the legislation at a recommendation of the Treasury Dept. Ok Dodd lied and its hard to call it anything else. Treasury Secretary Geithner may not have lied but certainly should have know about the legislation since it was recommended by his dept. I do not think Obama lied. My point is the American public is outraged at AIG and those employees that received the bonuses. Isnt the anger being misdirected instead of holding Dodd and the Treasury Dept at fault and the anger should be pointed at them. Why hold the AIG employees at fault. Maybe I am missing some newer news or somthing?

CAW, I agree with everything you just posted. I didn’t vote for Obama (didn’t vote for McCain either — I always vote Libertarian). This is a mess made by both parties. They are both the same with the same goal: money and power.

tax them until they have to live like rest of us…hand to mouth…pay check to pay check…then maybe they will stop being so greedy when they see how hard it is to be the real americans the working class americans.

And the corporate shill media will just let them get away with it.

No one is talking about the basic compensation problem created in the area of executive compensation, a problem that began early in the Reagan administration. At that time the average CEO of a small to medium size bank or company (if not the owner) was never paid more than 30 times the lowest pay grade in the company. In large companies that figure hovered around 50 to 1. On Wall Street (not including partners)and in largest corporations the figure was about 80 to 1. Those ratios had been fairly stable prior to that time.
During the Reagan years, partly in response to the greater emphasis on greed, those ratios began to favor the boss over his employees by a larger and larger margin. Today they have reached astronomical figures. In small to medium size companies it has reached as high as 100 to 1. In large banks and companies it is now as high as 200 to 1 and the the very largest banks and in Wall Street firms in has reached over 300 to 1. That means that the average CEO of a bank like Bank of America is paid $ 1,500,000 a year (base pay)and the lowest paid bank employee gets $5000 per year. All of this, in the case of CEOs, is just base pay, not counting bonuses, stock options and a variety of expensive perks.
Managers used to believe that they owed a duty to their community and especially to their employees, but no longer. The era of greed has come upon us!!!!!

Who is the bigger of the crooks? Those percieved to have not earned their salary from a private company when it was earned or all those covering their butts in the senate/house/administration for really NOT doing their jobs and stealing from the taxpayers all the time?

Isn’t it interesting that (proposed Commerce Secretary) Senator Gregg was working with Geithner when the legislation was being worked on.
Now, Gregg says we shouldn’t tax these guys and Gregg blames Obama for this.
Why was Senator Gregg was so against the bailout bonus being part of the bailout legislation earlier this year?
There are Democrats and Republicans taking this money. Everyone of them is corrupt. Republican Cantor is leading all politicians in campaign contributions from executives at companies that benefited from the bailout money.

Blah. Blah. Blah. The DANGER is the FISCAL DISASTER caused by these BAILOUTS. A $2 TRILLION deficit and a national DEBT beyond repair.

I hear repeatedly that AIG is too big to fail. Any company that is that big & involved in too much of the same industry could be broken up like AT&T was in the 80′s. AIG & the SEC know what divisions of AIG are successful & what aren’t. Separate the good from the bad; feed the bailout money, our money, only to what’s worth saving. Perhaps a bit simplistic but . . .

This is all BS. In March 2008 AIG renegotiated the contracts of the employees in the Financial Services Division (located in Connecticut) guaranteeing them the same compensation for 2008 as they received in 2009. This was done to keep the people in place who knew what was going on in place rather than bring in new people and have to wait until they learned where everything was and how it was put together. Sometime after this Liddy was brought in as the CEO, he did not negotiate the contracts in question. AIG received TARP funds and the second round which was doled out under the Obama administration had a bill associated with it which put limits on what could/could not be done by the recipients. Most Senators were concerned about such a situation as what is now happening and wanted to have words to address the potential problem. In all of his wisdom Chris Dodd (from Connecticut and the recipient of over $100k from AIG) inserted an amendment which stated that contracts prior to the bailout had to be honored. This was in the final legislation sent to Obama (also received over $100k from AIG) who signed it into law. Under Connecticut law for AIG not to pay the compensation agreed to in the contracts could subject AIG (now also the US Government) to double the cost of the agreed upon compensation, hence AIG’s payment of the retention bonus to the employees. Now Chris Dodd is talking about a special tax to get the money back from these employees, this would be in direct violation of Article 1, Section 9, Paragraph 3 of the Constitution. Another idea is to sue to get the money back which will cost the taxpayers even more money. Currently everything which has been done is legal although we the taxpayer may not like it, if Chris Dodds amendment had not been signed into law it may have been easy to stop these payments. Let Chris Dodd and the others who changed the legislation which made the payments legal pay the $160M to the taxpayer.

Spartan Phoenix777 – If term limits were in place (two terms [12 years] for a Senator and three terms [6 years] for a Representative were in place then think of how the taxpayer would save on the retirement of these elected officials. Here is how their retirement would be affected using the Civil Service Reform Act of 1984. Members elected since 1984 are covered by the Federal Employees’ Retirement System (FERS). Those elected prior to 1984 were covered by the Civil Service Retirement System (CSRS). In 1984 all members were given the option of remaining with CSRS or switching to FERS. As it is for all other federal employees, congressional retirement is funded through taxes and the participants’ contributions. Members of Congress under FERS contribute 1.3 percent of their salary into the FERS retirement plan and pay 6.2 percent of their salary in Social Security taxes. Members of Congress are not eligible for a pension until they reach the age of 50, but only if they’ve completed 20 years of service. Members are eligible at any age after completing 25 years of service or after they reach the age of 62. Please also note that Members of Congress have to serve at least 5 years to even receive a pension. The amount of a Congressperson’s pension depends on the years of service and the average of the highest 3 years of his or her salary. By law, the starting amount of a Member’s retirement annuity may not exceed 80% of his or her final salary. Reference is http://usgovinfo.about.com/library/weekly/aa031200a.htm . Even though they would have the minimum time to collect retirement if they served the maximum term they could not begin collecting until they attained the age of 62 as they would meet none of the other requirements listed. I like this one even better as it get rid of most of those who are the real problem as they have been in place forever and think they can do no wrong as they are in charge.

Excerpt from The Case for Paying Out Bonuses at A.I.G.
By ANDREW ROSS SORKIN
“So as unpalatable as it seems, taxpayers need to keep some of these brainiacs in their seats, if only to prevent them from turning against the company. In the end, we may actually be better off if they can figure out how to unwind these tricky investments.
Not that any of this takes the bite out of paying these bonuses. For better or worse — in this case, worse — someone at A.I.G. decided this company needed to sign bonus agreements last year to keep people before the full extent of its problems became clear……But another possible explanation is that A.I.G. knew it needed to keep its people.”
NOTE: “someone at AIG decided … to sign bonus agreements last year …” This came from inside AIG, was approved by the Bush administration last year. When it became known this year some in Congress tried to stop it, but Treasury disagreed, fearing it would fuel a meltdown if this unit isn’t unwound properly. There is still $1.6B they are trying to settle out and that’s not happening in a couple of days. Google aig retention plan and get some facts.

All of the manufactured hype about the AIG bonuses is much like the magician drawing attention to the BRIGHT SHINY OBJECT! BRIGHT SHINY OBJECT! while doing something underhanded behind his back. In point of fact, the bonuses were part of a legal contract that long predated the bailout – and the claim that Congress and the President did not know about them (or at least the possibility that such bonus contracts were already in place at some firms) does not pass the smell test: Otherwise, why remove the provision from the final bill that would have allowed such contracts to be set aside for companies receiving bailout money? Such a provision would have been entirely appropriate, since the alternative for many companies would have been bankruptcy which would most definitely have allowed all of their contracts to be reviewed and possibly set aside by the bankruptcy courts.
So what, exactly, is Congress planning to do that requires such a distraction? Perhaps it’s that they are now planning to put in across-the-board wage and price controls; there are already rumors of something like that being proposed within the next few weeks. This will hurt FAR MORE people than are affected by the AIG affair, but if they can put up enough of a distraction there’s a real possibility that they can slip it in under the radar, or at the very least put enough lipstick on the pig that people’s anger over AIG can be channeled into at least grudging support for the effective nationalization of our entire economy.
Or perhaps what they’re trying to hide is that because of all of this recent government intervention in the economy, our money supply has apparently been growing at a frightening pace over the past few months. (It’s hard to come up with exact figures since the Treasury no longer publishes official figures, but recent statistics published by prominent financial publications show the money supply drifting slowly upward over the past few years and then suddenly spiking since the bailout). Unless this is brought under control it will almost certainly cause runaway inflation – and in fact Bernanke has said that he thinks that “some inflation” would probably be a good thing at this point, essentially telegraphing what’s in store. It wouldn’t be too surprising if within a year or two we have double or even triple digit inflation. This would allow the effective massive tax increase that would be necessary to finance all of this new spending: it will all be paid back with inflated (cheaper) dollars, and we will all find ourselves in much higher tax brackets. Obama may be exactly right that he won’t increase taxes for those making under $250,000 a year, but if at that point the poverty level is about $150,000 a year, with bread costing $20 a loaf or more, that will be small comfort.
One thing we can be sure about: Congress has something nefarious up their sleeves. It’s very easy to tell when politicians are lying: There lips are moving. Hold onto your wallets, this is going go be a wild ride.

I find it interesting how easily my fellow citizens can be distracted and manipulated by politicians and the media. What happened at AIG is angering and frustrating. However, this is only one small part of a worldwide crisis. Even if the bonuses were returned, the economy would still be in miserable shape. There are much more important issues to be discussing right now. Unfortunately, they are too complex and seemingly dull for most people right now . . . more’s the pity.

The House this past week passing the tax on AIG reminds me of the story about when you’re up to your butt in aligators, it’s hard to remember that the initial objective is to drain the swamp.
I do not agree with what AIG did with the bonuses, but $165m is “peanuts” compared to the entire bailout bucks expended. I think Congress ought to get on with “draining the swamp” so we won’t have aligators to contend with in the future!!

Jared Bernstein, you’re hot. Marry me!

Collins et al can shove it! As pissed as I am about the bailouts to begin with; their pious bleating now does not cover the fact that they passed legislation without reading it. They want to nail AIG for their incompetence. Well, one hell of a lot of Congress people should be cutting their own bellies right now!

Bailing-out corporate Behemoths is the strategy you can Believe in.

Let’s see $165,000,000 which is already going to be taxed to the hilt or the real story of a $2,000,000,000,000 pork bill with no guaranteed return. Which is more outrageous.

when aig made a contract with its employies, and if they knew that they were not in a position to honor it with there own money, then the contract was a fraud. they shoud go straight to jail and the money must be returned.

As much as I dislike AIG and blame the company for much of our woes, the punitive bill passed by congress was bad legislation. I doubt it would hold up in court if challenged

no more money for these rich republican scum bags….

The founders of this great nation of ours warned the young country then about mob rule! That warning resonates high today. The framework of our Constitution is meant to protect us from this. Unfortunately, the idiots running our government today could care less about the piece of paper they so swore to protect. The knee jerk reaction shown this last week is just that. The jerks in Washington are trying to save their own political skin now. Indeed, their reaction is dangerous and unprecedented. What is to keep government from going after you and me using tax law to punish those that oppose their views or get in their way. For being a student of Constitutional Law, Obama is sure an idiot if he signs the bill into law. Obama knows better. So we’d think, eh?

mike—i dont fear that as much as the bush law of tapping my phone…

I don’t think Obama has any clue what his doing here, so sad to see America is heading toward bankruptcy, we go this miracle kid jumping up and down, opening your wallets, spend spend and spend, God save this piece of land

Republicans need to get THEIR act together and quit the slander and constant Obama bashing. Just look at its recent campaine and past. The Republican Party shamelessly abandoned its values. Not only did Republicans disavow their leader (George W. Bush), they pressured presidential candidate John McCain into supporting far-right positions he had previously opposed, thereby destroying his political integrity. Meanwhile, the win-at-all-costs mentality of Republican strategists led to the adoption of an overridingly negative and cynical campaign strategy—one that attempted to demonize Barack Obama by portraying him as a terrorist and someone without a U.S. birth certificate. Even more shameful is that McCain and his campaign (with a handful of exceptions) tacitly endorsed calls for violence against Obama by failing to discourage rally goers who shouted “off with his head” and the like. However, the most irresponsible decision of the year was McCain’s choice of running mate, Sarah Palin, who was painfully unqualified and neither the reformer nor maverick she purported to be. From her very first public appearance it was clear the self-proclaimed “hockey mom” was in over her head, and although handlers bent over backwards to hide her intellectual shortcomings from the American people, she was ultimately exposed as being totally unprepared to be vice-president. Before pointing your fingers at Obama or anyone else, try looking at yourself and what you need to do. I am so tired of the Republicans BS. THEY OFFER NOTHING but slander and offer no solutions for anything and feel their gift is to spend every waking moment slamming Obama and everything he does. Dont hand me that “you did it to Bush” either. I voted Rep 32 years all the way until Bush’s second term and praised Bush when deserved and didnt have a problem with him until he lied about Iraq and through Rove at us.

165 million is a distraction by the government controlled media. I would like to know like the WSJ wants to know were the 9.7 trillion went and why a private bank ( federal reserve ) refuses to answer the question. Why are the american people not outraged about this. These members of congress pass bills without reading the bills is insane also. This is just back peddling so they get elected again. Both democrats and republicans work for themselves and their parties. They pass bills that effect what they are invested in, that will benefit them not the american people. end the fed. no to the new world order.

I do not think Obama is a liar but his credit went down a notch or two this week. As a Obama supporter I am very upset at the way he handled this AIG mess. I knew that having a Dem Congress/Senate and Dem President left no check and balance. I still like Obama and feel he should have handled this better with accountability as he promised. Now Dodd and some in the treasry Dept are liars!!Dodd said he didnt know anything about it and 24 hrs later said he did. Dodd and the Treasury Dept are at fault for the legislation on the AIG bonuses, but the Obama administration deverted blame and anger from the Congress and Treasury Dept where that blame should go to AIG and its employees. This was wrong and typical old school politics and dishonest at best. Obama promised honesty and accountability and he isnt holding those accountable responsible but deverting it elseware. I am not sorry I didnt vote for McCain and am still ok with Obama but not happy with his decisions this week. We will see.

When I first heard this reported as taxing the AIG bonuses I thought that was wrong, but now it is clear that the tax is applied to the bonuses of all financial institutions that receive federal bail-out money. That makes more sense. At least our legislatures are finally getting the troubled financial industry to scale back it’s expenses the same way asked the troubled automotive industry to, by going after worker compensation at companies that receive great loans in taxpayer’s dollars for the specific purpose of preventing them from collapse.

On the issue of $165 Million in bonuses:
Libby explained that the retention bonuses were exactly that, designed to retain the talent of specific individuals. Each of these execs were handed a set of toxic AIG Books to be worked down to non threatening assets. As each of the execs finished their job, cleaning up the books to the satisfaction of Liddy, they were given their bonus. The execs were retained until they completed their task, then granted their bonus. Libby emphasized that no merit bonuses have been paid.
Eleven of the execs left after receiving their bonus. So the Congress and the Media blathered through foaming anger that the execs were paid and not retained. Again, Liddy explained that these people finished their task – then received their reward.

YOU THINK THIS IS DANGEROUS? NO CRAP!!!! THIS IS NOTHING BUT A SMOKE SCENCE AND THEY WANY US PISSED OFF ABOUT THIS. THERE IS GOING TO BE A REVOLUTION AND IT IS TIME TO STAND UP FOR AMERICA. THE PRESIDENT NEEDS TO BE IMPEACHED.

Obama’s teleprompter is changing his/her mind … yet again. Perhaps the leak that Senator Chris Dodd had snuck a provision into the pork-us-all bill that allowed the bonuses, then perhaps after Dodd reluctantly admits that he did it at the request of “Administration staffers”, Obama’s teleprompter had no choice but to change his boss’ tune … once again. I hope this bipolar government is exactly what their voters wanted.

Dangerous my *#¤!!!
Eight Dems wanted to be president in that first television debate and only one of them did not have a plan for universal health-care? Guess who won. Obama is in the pocket of the insurance industry as he has been from day one. The biggest corporate fundraiser in history got only 25% of the money from small donors. Same number for Bush was 24%.
The numbers don’t lie: Obama the same old politics, a hypocrite and USA is screwed!

Harvard law professor Laurence Tribe says a high tax on bonuses paid to executives by companies receiving bailout funds could likely be structured in a way to avoid constitutional problems.
Some proposals are circulating to tax bonuses at rates varying from 70 percent to 100 percent as a way to recoup the $165 million paid to executives at AIG, the Wall Street Journal (sub. req.) reports.
One issue is whether such a bill violates the Constitution’s ban on Bills of Attainder that punish a person or group without a trial. Tribe told the Wall Street Journal that Congress could avoid that constitutional problem with a broad bill that doesn’t target “a closed class of named executives.” Also blunting any Bill of Attainder challenge would be the fact that the aim of the tax is fiscal rather than punitive, and it would apply in the future as well as retroactively, Tribe wrote in a summary posted at the Atlantic.
Another issue is whether retroactive taxes violate the ex post facto clause. Actually, it’s a nonissue, Tribe says. “The ex post facto clause applies exclusively to criminal punishment and poses no difficulty here,” Tribe told the Wall Street Journal Law Blog.
Tribe also addressed whether the law would violate the contracts clause, the takings clause and the due process clause in the Wall Street Journal Law Blog interview. He saw no problem. Many courts have ruled requirements for substantive due process are not violated if the legislation has a rational legislative purpose, “something nobody could deny in this instance,” according to Tribe.
The Wall Street Journal also points out that a tax rate approaching 100 percent is not unprecedented. The top federal income-tax rate was once 90 percent, and some excise taxes on specific transactions have hit 100 percent.

AIG Bonus/retention pay approval as permissible last fall under Paulsen and Bush Administration to wind company down and break. Paulsen recommended Liddy to come in to take over AIG for no pay. Liddy accepted and as brought in. AIG payouts this March are result of government/AIG agreements last fall. Second stimulus law passed had some limits for salary/retention pay/bonus after February 9, 2009.
Present anger should actually be directed at Bush administration. Obama administration recommended new restrictions that were fair and legal- all new negotiations. Second stimulus bill was passed.

If Congress would have read the stimulus bill, they would have known about the bonuses. Instead Congress rushed the bill thru and then went on vacation. We get who we vote for!!!

Carisoprodol.

Carisoprodol fedex cod. Carisoprodol mg. Carisoprodol. Buying carisoprodol.