I think this is a bad idea. I’m as disgusted with what’s gone on with these bailout companies as anyone (I actually worked at AIG briefly on a computer contract several years ago, incidentally). But to pass arbitrary laws like this because the mob is shouting for them doesn’t sit well with me. Having said that, voiding the bonuses completely would have been an even worse move.
This is a horrible idea. If the government doesnt respect a contract (whether you disagree or agree), what good is a contract anymore? Jeez… unbelievable.
The way I see this, if the government does not step in, AIG goes bust and there aren’t any bonuses paid and the executives are unemployed.
If a new suitor (U.S. Government) steps in to save them. As with any takeover, they go by the rules of the new suitor.
So why if we are bailing them out, thus salvaging their jobs, should a bonus be paid? They are lucky to be keeping their jobs and I am sure that their current compensation is much higher than yours and mine.
This isn’t about contracts. I believe in the sanctity of contracts. It is about performance. If Bonuses are performance based and they fail to perform, then their performance or lack there of voided them.
Just my 2 cents.
This is all a dog and pony show to get the general public into hating capitalism so that the new radical democratic group can further their agenda. It should be obvious to anyone with intelligence that BO and his administration knew about these bonuses almost a year ago.
Don’t fall for this.
100% agreed. I dont know if any of you watch Glenn Beck, but it is amazing how much tax dollar money AIG has sent to other countries. The politicians would rather have us argue over 160 million than the 45 BILLION of our tax dollars that were sent to other countries. Its all a game, thats all it is, and I am getting P@&@(*SSED
How many people at AIG got these bonuses? SEVENTY THREE got multi-million dollar bonuses. What I find particularly disturbing about the government’s action is that our federal government is targeting only a few undesireable people for oppressive taxation. When the federal government is allowed to target these few undesireables, who is next? Maybe next they will decide to target those rich landlords!
The tax code should not be used as a punishment for individuals! This is a VERY DANGEROUS precedent!
Mike
It is constitutionally illegal for Congress to tax those bonuses arbitrarily. I can’t remember the section. Also, Congress was totally aware and signed off on these retention bonuses when they passed the bailout bill. Socialists do not care about contracts. It falls under their whole view of moral relativism. They are throwing a fit over these bonuses to distract from the fact that Barry’s approval ratings are plummeting, now that people are seeing that he isn’t going to govern from the center and that he is in fact a Marxist. hopefully 2010 will serve as a stop loss.
I don’t think this has anything to do with socialism. It’s just congress pandering to public outrage and making a (bad) snap decision to make themselves look better. Business as usual.
To be devil’s advocate for a quick second here-
Most people on this forum are against the AIG bailout and bailouts in general, at least that is the impression I get. What’s worse than giving AIG money to keep the company afloat? Giving the people that ran it into the ground bonuses for their catostrophic failures. Not only that these are RETENTION bonuses to keep these people at AIG, a good portion of them don’t even work there anymore so why should they be subject to a retention bonus if they weren’t retained? I am very much against these people getting bonuses of any kind but it is a rather dangerous precedent to allow the gov’t to randomly levy taxes against specific groups or individuals. Of course there really is no other way to prevent them from getting their bonuses due to the damn contracts. Its really hard to imagine a retention contract wouldn’t be dependant on performance, why would a company wish to retain/give bonuses to a dismal performer? I really hope they rethink how they word their contracts in the future.
Pass the Fair Tax and then it won’t be an issue.
I agree. The solution is in changing how these contracts are done in the future, not meddling with taxes after the fact.
I believe these contracts were written over a yr. ago. “Tiny Tim” knew about these bonuses and asked them to be put into the stimulus bill. He was afraid of legal action against the govt. The govt. then entered this contract with AIG with these bonuses INCLUDED. It wasn’t caught or was ignored because nobody bothered to read the 1200 page bill. In less than 48 hrs. the bill wqs passed without any discussion, debate or analysis because the sky was falling and something had to be done ASAP :shocked. Now that this public outrage is running rampant, the govt. has egg on their face and is trying cover their A*%. As much as I hate the idea of these bonuses, the govt. committed to this and has to honor it. Not weasle out the back door by unjustified taxation.
This is all completley unconstitutional.
Totally aware?
They passed it without reading it remember? The democrats pushed it through so fast that no one could have a chance to read the whole thing. I wonder why?
This is just sickening. We gave total power in our government to a radically extreme group and they are doing what they have always done with power.
DB
Anybody think Obama would possibly lose the re-election in 2012?!? He certainly wont get my vote.(Even though the problem is obviously not only him)
This is why I was confused why anyone would vote for this guy…Even people on this forum…Isnt real estate investing a form of capitalism?..After all dont we all get into this business to make money??..Why would any of you have voted for this guy?..Bush was no prize but I would gladly take him and the Republicans over this socialist…Not looking to stir the pot here just want some opinions…Taxing AIG bonuses at %90 is insane…Never mind taxing Wall street bonuses at the same level…There is already talk over creative accounting to get around these issues…Obama will be a one term President…No doubt in my mind…
Also the passing of this bill will surely send alot of corporate talent abroad…I hope you all enjoy this recession…Its going to stay like that for a while…Europe and Asia will gladly take all the American talent that will run away from this tax crazed country…
What's worse than giving AIG money to keep the company afloat? Giving the people that ran it into the ground bonuses for their catostrophic failures.
Failures? I don’t think so. These are some of the smartest people on the planet! How many other people do you know of that have created a business that can make outrageous profits when things are good and then have the government bail them out when there business fails?
While we’re talking about failures, if we were really interested in punishing the failures, it certainly wouldn’t be these guys. Chris Dodd, Barney Frank, Bill Clinton, George Bush, and the members of the Congressional Black Caucus would all be in jail if there was any justice!
Mike
This is the part that totally blows me away… we the people have been whipped into a frenzy over AIG “wasting” $165 million (or 0.0009375 % of the money we gave them) on bonuses they were CONTRACTUALY obligated to pay, and the Obama administration and it’s treasury secretary TOLD them to keep in the legislation, yet there is no outrage at not only the Congress voting to give themselves pay increases during a recession, when they waster FAR MORE ($450+ BILLION in interest alone last year on the National Debt or 16.3% of the entire budget), but them voting for legislation they NEVER EVEN READ FULL of wasteful spending, and getting ready to spend us into deficits to the tune of TRILLIONS dollars PER YEAR for the next decade DESPITE the fact that the CBO has already said it is UNSUSTAINABLE! But don’t let that stop them…
Absolute insanity!.. and this is the same government, who people seem to think is capable of running the entire healthcare system. What do you base this on? What track record do they have that even remotely makes you think they are capable of this?
Or are you just going to go along off the cliff because you think you will get “free” healthcare?..
I agree with everything you just posted, except this. We the people have not gave them this money yet. This is money that is going to be taxed through inflation. This is money younger people (me) are going to be paying for for a long time, in the form of suffering.
Another point, outrage is excatly what the powers to be want. Not the powers to be we know about, but the people behind the scenes that control our money. More specifically, the people who control and reap the rewards of the federal reserve. They hire people like turbo tax cheat to make baffons of themselves, so that attention is divererted from the real problem, of a failed monetary system. Very few people will talk about this, when they have people to point fingers at. Don’t fall for it!
As long as we never doubt the system, the powers to be have us by a string.
The only thing I can come up with, is a revolution, a leader like Ron Paul. Someone who hasn’t let political power and wealth corrupt them. A rare find.
I recently saw a news article in which Obama is asking congress for the power to step in and take control of these companies before the companies can fail. The way I see it, this is basically giving the government the ability to step in, take over, and run any company that they see might be a threat to the economy. This is no longer a socialist campaign, it’s downright communist.
Our fearless leader will continue to follow in the footsteps of Hugo Chavez: http://www.csmonitor.com/2009/0217/p06s01-woam.html
This new party in power scares the hell out of me, and the way the media and the masses bow to their whim is further proof that this country needs someone to step up and end this downward spiral. Hopefully 2012 isn’t too late.