A friend of mine took me to task last week for not commenting on the House passage of a bill levying a 90% tax on bonuses granted by companies receiving the Federal banking bail-out funding. I had to admit to him that I hadn't been paying much attention to the news recently, so knew nothing about it till he grilled me about it. But I also opined that, since it was directed at those particular companies, I wasn't too torn up about it. (I've already stated I'm not particularly taken by any of their arguments justifying the massive bonuses being paid out at this time.) He argued 'slippery slope' — "give the government an inch, they'll take a mile." I told him I understood the sentiment behind the bill and, while I might not be 100% behind the idea, I wasn't ready to storm the barricades protesting it.
Then I read this in an article from Saturday's LA Times:
BONUS BACKLASH RIPS INTO WALL ST.
A bonus, by definition, is something given over and above someone's normal compensation (and I don't care how that payment is structured in your contract with your company). But if you're planning on taxing someone for their normal compensation, just because it's higher than some arbitrary limit you've set as acceptable… well frankly, suddenly those idiot arguments about "socialism" that Republicans and Neo-Cons have been throwing around for months suddenly start to sound a little less idiotic. (Let's face it, do we really want to give the moron from the House that claimed "we're running out of rich people" fodder for more such lunacy?)
But politics aside on this one, it's an absurd stand to take. Hopefully, this one will die in committee, long before it ever gets past the "House Democrat looking for media time!" status that it's currently got.
Then I read this in an article from Saturday's LA Times:
BONUS BACKLASH RIPS INTO WALL ST.
Rep. Brad Sherman (DSherman Oaks) said he was preparing legislation that would impose a 70% surtax on all pay — not just bonuses — above $500,000 a year at major companies that received bailout funds.Now I'm out. I may have been on the fence, or even in agreement with a heavy tax levied on bonuses (which, arguably shouldn't be paid out at this time), but this has nothing to do with bonuses, or a company's performance, or anything, really, having to do with the bailout. Now we're going to tax people simply because they get paid a lot of money? This starts to smack of class warfare, and falls quickly down that slippery slope my friend was concerned about.
A bonus, by definition, is something given over and above someone's normal compensation (and I don't care how that payment is structured in your contract with your company). But if you're planning on taxing someone for their normal compensation, just because it's higher than some arbitrary limit you've set as acceptable… well frankly, suddenly those idiot arguments about "socialism" that Republicans and Neo-Cons have been throwing around for months suddenly start to sound a little less idiotic. (Let's face it, do we really want to give the moron from the House that claimed "we're running out of rich people" fodder for more such lunacy?)
But politics aside on this one, it's an absurd stand to take. Hopefully, this one will die in committee, long before it ever gets past the "House Democrat looking for media time!" status that it's currently got.
Comments
Read this: http://www.nytimes.com/2009/03/25/opinion/25desantis.html
It's a resignation letter from one of the AIG execs who received a 'bonus' check for $742k AFTER taxes. A lot of money, to be sure.
You say you're not 'taken' by any of the arguments regarding the 'bonuses'. Well, this may change your mind. Sounds like it WASN'T really a 'bonus' at all. It was the guys salary. It seems a lot of these execs agreed to work for a $1 salary in order to try and pull AIG out of the pit. These were contracted payments promised to them for staying and helping. So, IF this unconstitutional 90% tax somehow gets out of the Senate and past the Supreme Court, it is tantamount to taxing labor fees.
The thing that really chafes me beyond this outrageous tax bill is the whole media circus the Congress is putting on. What the fuck is Barney Frank doing up there berating Liddy? Who does he think he is? And Dodd? Dodd is the guy who specifically ok'd the clause in the bailout to honor the 'bonuses'. This whole Congressional hearing is bullshit. It's smoke and mirrors. These guys got nasty letters and bad polling and thought "oh crap, we'd better do something!" So, they stage this 'hearing'/witch hunt. It's even lamer than congressional hearings on steroid use in baseball.
I've had it with this crap. I'm going to get active this year and push for term limits on ALL political chairs. These tired old congressmen sitting pretty in their positions for years on end because voters get lazy is killing this country. They no longer represent anyone. They just siphon off the life from our country bit by bit.
And, Obama needs to quit listening to them and quit trying to do EVERYTHING. Stand up to the dregs of Congress and come up with a realistic budget.
Christ, this is getting ugly.
And, today, this reassuring bit from our President, "We have no desire to run GM."
Meanwhile, he has fired the CEO of GM and placed 'his team' in charge of developing a business plan that will guide the 'vision and path of the future' for the company.
But, the Government is not taking it over...
Ok, we have debated on these pages and elsewhere over GWBush and his antics. But, at least when we debated over his choices, they were choices and moves that you typically see the President of the USA making.
Memo to President Obama - running companies and taking over corporations is NOT YOUR FUCKING JOB!!!!
Next thing you know, he will be appointing officers...with Union officials, no doubt. Gotta get that capitalist money into the hands of the proletariat!
This is scary shit. This guy is in WAY over his head.
So, once again, I have to acknowledge that I've been taking a vacation from the news… very restful, and great for my blood pressure, I'm sure. So your post was nearly the first I'd heard about this item as well. At first pass, I really don't have much to say here. It's a bit scary, it's definitely unexpected, and it may be overstepping the boundaries of the normal function of our government. But I don't share your contempt for unions and the proletariat (having been a member of both at one time or another in my life). And, considering the depth of this particular financial crisis, did you expect "business as usual" to work? Isn't that what got us here in the first place?
Before you jump down my throat for that, I can assure you that I don't think that our government should be in the business of business. I don't want to see Uncle Sam on the list of chief execs at any company I'm working for. And I don't expect that Obama's going to put the UAW in charge at GM.
But I'm not afraid of what Obabma's doing right now, and while I think it bears watching, I'm willing to see if his plans can get us out of this crisis. Unlike the conservative demagogues of hate radio, I can's separate Obabma's failures from the potential collapse of our economy, so I'm going to hope that all those really smart advisers he's working with are making some really smart suggestions, and we're going to find this was the right thing to do in this case.
One thought that crossed my mind today is, what if this outrage was the intended result of this announcement. What if he wanted everyone to sit up and ask "What the fuck?!?" Let's face it, Ford may have said "we don't need any bailout money" back in December, but after they saw what it's cost GM to take the bailout money, you can bet that "asking the government for help" just got taken off the table at boardrooms across the country. It may sound a bit Machiavellian, but it's got a certain appeal to it: "Head's up, everyone… there's a new sheriff in town, and he's definitely doing things differently!"
As for your previous post…
I'm not defending the 90% tax bill, I just said I understood the sympathies behind it. And if, as you're saying, the bonuses are being paid in lieu of actual salaries, then yes, this becomes an even grayer and uglier prospect than before.
But if your company is being handed billions of dollars of taxpayer money to stay afloat, I don't think it's unreasonable to expect a bit of transparency (at least between the banks and the government handing them that cash), and the banks' arrogant business-as-usual, "we're not going to discuss how the money's being spent" bullshit didn't do them, or anyone else, any favors. Sadly, they may be reaping a bit of what they sowed.
But seriously, you're upset because Congress is playing at smoke and mirrors, and attacking a problem with the bluntest instrument they can find? They're unwilling to take the blame for their f'ups and want someone — anyone — else to be the whipping boy? We're not just talking political nature here, this is human nature. Blamestorming is a tried and true human pastime, existing long before there was such a catchy name for it. The only thing that makes this even remotely memorable are the enormous amounts of money involved, and this apparent attack on 'people who make too much'. It's not right, and it's not going to fix any problems in the long run. But if you expected anything more balanced and reasonable from Congress, you're more naïve than I am… and I've been known to espouse some pretty naïve ideals.
Chris, of course.