Dems Want to Tax Bonuses and State Blah, Blah, & blah

Enough with the AIG shit

The AIG bonuses outrage has Congress moving at warp-speed.

House Democratic leaders announced that a bill designed to tax the bonuses out of existence will come to the House floor Thursday, mere days after the news of the $165 million payout to employees of the embattled American International Group.

The legislation would levy a stiff 90 percent tax on bonuses paid by any financial firm receiving more than $5 billion in federal funds from the Troubled Asset Relief Fund.

“What happened with these bonuses was a mugging on Wall Street,” said Rep. Steve Israel (D-N.Y.), who worked on the legislation. “When you get mugged you want two things to happen. You want justice and you want your money back.”

“We’re just not going to say that we’re not going to anything” about irresponsible Wall Street executives getting bonuses with taxpayer money, said House Ways and Means Chairman Charles B. Rangel.

The $5 billion bar set by the legislation is not very high considering the piles of cash the government has poured into financial institutions since the fall. Indeed, it would hit banks such as J.P. Morgan Chase, which took the TARP money only at the insistence of then-Treasury Secretary Henry Paulson to ensure that the bank rescue plan would work.

The legislation would only affect employees whose total family income exceeds $250,000 per year, and would cover all bonuses received after Jan. 1, 2009.

Asked why they didn’t impose a full 100 percent tax on the bonuses, Rangel said he “figured that the local and state officials would take care of the other 10 percent.”

House Majority Leader Steny Hoyer (D-Md.) said he expected the bill to pass with overwhelming bipartisan support. He and Pelosi also said they’re working on additional legislative responses to the executive compensation issue.