Thursday, March 19, 2009

Congressman Boccieri votes to condemn and recoup the AIG and other TARP-paid bonuses

Meanwhile, House Minority Leader John Boehner votes the opposite: he opposed a bill that passed that recaptures the money by having the federal Treasury tax it 90% (with the expectation that state and local governments will recover the rest through taxes) and opposed a sense of Congress resolution condemning such irresponsible bonuses. (Putting Boehner outside the "mainstream for even fellow Ohio Congressional Republicans like Jean Schmidt.)

So, naturally, Matt Hurley at the conservative Weapons of Mass Discussion then attacks Congressman John Boccieri for voting to "block a bill that would have helped the government recoup the taxpayer-funded bonuses AIG executives received!" Naturally, that's what makes sense. . . to nobody but partisan hacks like Matt Hurley.

What Boccieri voted to table was a toothless resolution that merely demanded that the Treasury Secretary "recoup" the bonuses somehow (the Republican resolution actually gave the Treasury no real power or authority to do so, it just mandated it). What he voted FOR, and what actually passed was a bill that gave the Treasury Department the means to forceibly recoup the money by creating a tax on the bonus.

I think Matt must have gotten his Johns confused. Naturally, there's no criticism of John Boehner who voted against giving the Treasury Department the authority to recover this money by taxing it, or condemning it. No, because although John Boehner never wore a military uniform, he's a "great American;" but John Boccieri, an Iraqi Freedom vet who served our country with honor in uniform overseas in a combat zone, he's "anti-American."

I'm starting to wonder if Matt Hurley comes from the Bizarro World. Because the truth seems to always be the opposite of what he says.


Anonymous said...

The easy vote on this was a yes. People are mad, gotta get on the right side of the people. That's the game, even though the 'stimulus' bill specifically authorized these payments and others like them.

But you're a lawyer. What are your views as to constitutionality of this stunt? I'm not a lawyer and I think it's pathetic.

Modern Esquire said...

Totally constitutional. There's actually a historical precedent for this. From the AP:
"A tax expert said there is plenty of precedent for levying punitive taxes on behavior that lawmakers find objectionable. Robert Willens, a corporate tax lawyer in New York, cited the steep excise taxes levied on money paid to firms to keep them from launching hostile takeover bids, known as "greenmail."

"You can write very narrowly tailored laws," Willens said. "And they can do it for bonuses already paid."

Bill of attainders, the constitutional prohibition some are mistakenly criticizing this as being, is a much narrower legal issue. A true bill of attainder is the seizure of property or imprisonment and death of individuals by declaring them criminals without the benefit of trial.

Congress can pass tax provisions and even make them retroactive for events that have already occurred.

Anonymous said...

what about equal protection?

Modern Esquire said...

Because AIG managers and executives are not considered a protected or quasi-protected class under equal protection jurisprudence, the Court would apply "rational basis" review to any EP challenge. To date, I'm not aware of any successful equal protection challenge where the court applied the rational basis standard of review.

Regardless, I don't the government would have trouble arguing there's a rational reason why it wants to recapture taxpayer money given to companies in bailouts to encourage the financial sector for lending but was instead used to give senior managers and executives salary bonuses instead.

Anonymous said...

I might be in over my head here, as I'm not a lawyer, but by equal protection I meant that these bonuses were legal, specifically authorized by the 'stimulus' bill and therefore fundamentally no different from any other bonus an employee of a private - in this case, 'private' - company has ever received. Congress can make a retroactive law to single these individuals out? Highly dubious, in my view...