Everyone likes to dump on Congress because it’s full of idiots, but there are some pretty smart folks up there. Representative Brad Sherman (D-California) squared off against some CNBC blowhard named Mark Haines and kicked his ass all over the place. Watch and enjoy.
I trust in the president, but I don’t share his confidence in Treasury Secretary Tim Geithner. Geithner seems to be like Indiana Jones and making this up as he goes along.
Geithner may be a smart guy, but he’s lousy at conveying confidence that he knows what he’s doing. The Secretary of the Treasury isn’t usually as prominent as the Secretary of State or Attorney General, but in a time of financial crisis, the importance of the position becomes magnified. Simply put, Geithner isn’t inspiring confidence on Main Street or Wall Street.
Come on, Mr. President. Fire Geithner and hire Brad “The Sherminator” Sherman. He seems to get it the best way to handle these bums and thieves at AIG is to grab ’em by the collar and smack ’em around a little instead of Geithner’s approach of throwing billions of dollars at Wall Street and hoping they’ll play nice with taxpayer money.
While I’m always in favor of giving it to greedy and stupid CEOs and corporations good and hard, it looks to me that Congress is engaging in one of their favorite pasttimes: covering their own sorry butts.
Politicians are nearly always in reelection mode and both parties are trying to figure out how best to pimp this issue to their own advantage. This 90% percent tax seems to be like like purchasing an expensive security system the same day your car is stolen. I don’t think Congress can do anything more than ask the AIG officials to return their bonuses, though if I were one of them I’d probably tell ’em to stick it.
Congress, The Bush and Obama Administrations all blew this one big time. With the talk shows phone lines glowing, the coffeehouses chattering and dinner tables dissing on AIG (Arrogance Incompetence Greed) everyone is looking to appeal to populist anger and that’s probably politically the smart move, but it absolves Congress and both the current and former Administrations from their negligence in providing oversight.
I’ve never bought into the suggestion that applying conditions to the bailout bucks would result in an exodus of talent from AIG and other institutions. To suggest only the arsonist that burnt your house to the ground is the only guy qualified to rebuild it is a specious argument. If all of that “talent” decides to boogie over to India for jobs there, give a bunch of work visas to some financial wizards from India and call it a even swap.
But I agree with Talking Points Memo writer Joshua Marshall Mitchell that the heavy-handed method Congress is employing a “kill ’em all and let God sort ’em out” approach.
If you have a household income over $250,000, and you receive a bonus, 90% of that bonus would be taken back in taxes — through a mix of income and excise taxes.TPM
This strikes me as pretty ill-advised on a couple levels.
First, what’s to stop the companies from just folding the ‘bonuses’ into straight salary income? In which case, the whole thing goes out the window?
Second, this cuts a pretty broad swathe. You don’t want CEOs who drove their companies into the ground pulling down multi-million dollar bonuses from companies that wouldn’t even exist any more without big taxpayer handouts. And the folks at AIGFP who played a big part in driving the whole economy into the ditch with their reckless and possibly criminal behavior shouldn’t be reaping big rewards of taxpayer money.
But it’s not clear to me why a couple, both of whom work in the financial services industry, and make $150,000 each should essentially have their entire bonuses taken back in taxes.
If Congress wants to punish AIG they should have written the provisions doing so into the original bailout and not try to try impose them retroactively. Doing it now only indicates how sloppily they did their jobs back when Henry Paulson came calling warning of the apocalypse if AIG were allowed to fail.
Oh, and Timothy Geithner? You are so out of here.