Let's get something straight: a 90% tax on a reward that nobody else gets is NOT a punishment.

[closeupready]

Forget that many of those who were supposed to receive it haven't earned it.

If the original bonus amount amounts to (as I've read) your 2007 salary, and their salaries are $250,000, that's still a $25,000 bonus - likely $25,000 MORE than the taxpayer (who is financing this bonus) next door received as a bonus.

Fails the bill of attainder test.

[angstlessk]

1. not only that, if they are hedge fund traiders they get a TAX BREAK

for the rest of their salary, claiming it is capital gains when NONE, ZERO, ZILCH of their income is at risk!

[closeupready]

4. It's outrageous the games they get away with.

We should go back to Eisenhower era marginal tax rates.

[Raskolnik]

2. Yes, it is. It may be morally justifiable, but it is likely unconstitutional.

Just because it is a popular punishment doesn't make it constitutional.

[closeupready]

6. No, it is not.

It reduces the reward they are receiving, rather than harms them, which is what a true punishment does.

It's a fine distinction but this legislation is NOT punishment.

[Raskolnik]

8. Reducing a reward is a punishment. A popular punishment, and perhaps a fair punishment, but

a punishment nonetheless.

Perhaps this hypothetical will help: Let's say a convicted sex offender won a ten million dollar prize in the lottery. Congress doesn't like the idea of a convicted sex offender reaping the rewards of a public lottery, so they pass a 99% tax on this individual's winnings. Under your standards, this could not be considered a "punishment" because the individual is only having a reward reduced. However, this would unquestionably be considered a bill of attainder and be unconstitutional.

[closeupready]

12. Bad analogy; it's unclear that AIG people committed crimes, and that's

not why people are complaining anyway.

But let's go with this crime analogy: better way of looking at it would be say a group of people rob a bank. They are caught. Demanding that they give 90% of their take back is not in any way a punishment. In fact, it is a reward.

[Oregone]

3. Yes, thats why I say tax waitresses tips 90%

[girl gone mad]

19. If the waitresses were being paid big bonus tips from public funds,

after having served poisoned food to their clientele, driving all of their business away... then you might have something with that goofy analogy.

[Dreamer Tatum]

5. That is not at all "straight"

The tax is clearly, absolutely, and unambiguously a punishment, as it was done in response to something
that is merely UNPOPULAR.

I'm not sure who you intended to "straighten out," but I think the wrinkled one might be you.

[terisan]

7. Obama is opposed to the 90% tax and Congress is grandstanding-so it will be modified.

The Obama-Geithner Wall Street/BigBank Bailout Plan means that the Budget Plan is going to Fail until it is greatly modified.

Until the wrath of the people is directed at the the politicians in power-Obama and the Democratic Congress we will not prevail in economic reform and the Bush administration will get away without prosecution.

The reality is that the Dems control the white House and the Congress and if we are unwilling to hold them accountable, we have abdicated the power of the people.

[closeupready]

9. Here's an excellent comment to a blog which discussed this legislation:

>>A failure to allow an act to happen is not a punishment. This is not punitive taxation, it is prophylactic taxation.

It's a Republican spin thing that has you even thinking it might be punitive.

This is about how a desperate effort to act quickly to avoid our country melting down led to a situation where these people should not have been allowed this money in the first place, and recovering from that. When these people were allowed money they never should have had for reasons that were unconscionable in a situation that was a de facto bankruptcy (as I've recently discussed on my blog), they didn't respond politely to a request to just give it back. The response is not punitive, it is remedial. There is a difference. Punitive would be to take the suggestion made by someone and take 1000% of what was paid. Any number less than 100% is, by my definition anyway, not punitive. If someone robs a bank and we tell them to give 90% back, that's not punitive.<<

http://open.salon.com/blog/saturn_smith/2009/03/19/taxation_as_punishment

[Raskolnik]

10. This comment just re-states the faulty logic that anything less than 100% confiscation

cannot be a "punishment." That is not a supportable position.

[closeupready]

14. It's true. How is the truth 'not supportable'?

??

[county worker]

11. The whole system is set up for those at the top to increase their wealth at the expense of the rest

of us.

AIG insured things that they had no ability to insure. Now we are the insurers of last resort. The managers got a bonus to insure things that they knew they could not insure. They gamed the system and lost yet they have no intention of sharing in the loss that their risk taking has caused. We now share in the loss through the recession, job losses, wealth losses and we are going to use our tax dollars to make AIG whole along with the managers. That will be at the expense of social programs if the right has it's way and the increase in debt will be put on the backs of our kids.

So to make a long story short, we are asked to take it on the chin, not to improve our conditions and be ready to take it on the chin the next time this happens.

I say that the managers are guilty of fraud for saying they could insure something that they could not and we should not be rewarding them but investigating them for fraud. Let them use their bonuses for court costs and legal fees.

[rollingrock]

13. A $100,000 bonus isn't chump change

It's amazing to me how anyone in congress can think a tax of 90% hurts them in anyway.

90% of an average $1 million bonus still leaves these crooks with a very large payout.
That 100k on TOP of their regular salary. Hell, the average American doesn't even make anywhere near that much in salary.

A tax of 99.9-100% on these bonuses would have made far more sense.

[stillcool]

15. AIG should give back the bonuses..

and be done with it. If Congress decides the last minimum wage hike they passed was too high, can they tax me on the difference?

[angstlessk]

16. why is it we can specifically target tax breaks but not taxes???

if ONE is illegal both should be illegal!!!!

[chill_wind]

17. In the meantime, seems 13 of the top 23 bailout recipients owe more than $220 mil in unpaid taxes.

http://www.mcclatchydc.com/politics/story/64504.html

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=5313853&mesg_id=5315089

[JDPriestly]

18. I suspect that the objection to the bill to tax the bonuses is

based on the idea that the tax is not on a particular class of income, but on a particular class of people -- the people who earned that income. I disagree. The tax is on a particular class of income, not on a class of people. And it is not a punishment. Is it a punishment on smokers or drinkers if we tax the purchase of alcohol or cigarettes more than the purchase of chewing gum or milk.

Is it a tax on a particular class of people if we tax the purchase of luxury items or plane tickets or gasoline at the pump? Of course, Scalia would disagree with me. No doubt one or more of his children has a cushy job on Wall Street or for a Wall Street law firm.