The House of Representatives just passed a bill that would basically recoup the AIG bonuses by just taxing the hell out of them. Introduced by New York’s Charles Rangel, the bill targets AIG but would affect the bonuses of employees making $250,000 from any company that received at least $5 billion in government bailout money. Sounds like a pretty clever way to get back that vile bonus money without breaking AIG’s sacred contracts, right? Well, it’s not quite that simple.
First, there doesn’t seem to be a clear consensus on whether this is actually even constitutional. Harvard’s celebrated constitutional scholar Laurence Tribe thinks it is, but others believe it could “trigger years of litigation” anyway — which is actually why the bonuses weren’t blocked in the first place. But Democrats are more concerned right now with getting this monkey off their backs, and quick.
Meanwhile, Republicans have had a hell of a good time shouting about the outrages of these bonuses, but many would much rather keep the Democrats in hot water than actually resolve the issue. Plus the phrase “90 percent tax” alone makes them light-headed. So the debate on the House floor basically consisted of everyone yelling at each other about various things, and it was actually pretty riveting television. Ultimately though, enough Republicans probably didn’t want to appear to “side” with the AIG fat cats, and the measure passed. Phew. If we never hear the word “bonuses” again, it’ll be too soon. Of course, we will — the Senate will take up a similar bill next week.