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Sup with Kissell?

From Nate Silver:

Six Democrats, meanwhile, voted against the bill: Melissa Bean, Larry Kissell, Michael McMahon, Walt Minnick, Harry Mitchell, and Vic Snyder.

Of course this is the bill to tax the AIG bonuses at 90%, rendering them virtually moot.

Personally I'm all over the place on these bonuses.

Shouldn't a de facto nationalized institution defer to its new majority holder, the US government?

Is it really worth fussing over 146 million dollars out of a 144 billion dollare package?

If the bonuses are paid, the liklihood of future funds, even if desperately needed, is minimal at best.

Are these particular bonuses not bonuses at all but rather salary, as Nate suggests?

All of this aside, I'm really having a hard time seeing why Kissell, or any Democrat, would vote against the bill.

On top of his vote against HR1106, call me less-than-enthused about my previous support for Kissell.

Kissell press release

Kissell demands AIG pay back 100 percent of bonuses

Washington, D.C.—Today, Congressman Larry Kissell demanded that American Insurance Group (AIG) pay back to the American taxpayers all of its obscene bonus payments as he voted against a measure that allows the government to enact retroactive taxes of up to 90 percent on businesses and individuals.

“Tax penalties should be used to go after those who violate tax laws,” Kissell said. “AIG and its executives should be severely penalized, but arbitrary and retroactive manipulation of the tax code is not the right way to do it. Rather than be taxed at 90 percent, AIG executives-- in America and abroad-- should be forced to repay at 100 percent the money they received as part of this bonus package. The American taxpayer is the majority owner of AIG, and we demand a 100 percent refund of these shameful and ridiculous bonuses. That is why I signed on to the bi-partisan Paulsen bill.”

Many of those who received bonuses from AIG work in the company’s London branch, and therefore are not subject to American taxation at any rate at any time. Therefore this legislation will not recoup any of that money, even if the measure stands up to likely legal challenges. The measure’s assertion that government has the right to retroactively tax certain individuals as well as to essentially dissolve legal contracts between employers and employees will no doubt place application of the measure in serious jeopardy. The Bi-Partisan Paulsen Bill, HR 1577, puts a two-week deadline on the U.S. Treasury Department to formulate a plan to recoup 100 percent of the AIG bonuses.

“Passing a 90 percent, retroactive tax sets a dangerous precedent from which no industry, business or person may be safe in the future,” said Kissell, a Democrat who represents North Carolina’s 8th District. “Egregious taxation is not the answer to our nation's ills, even those as blatant and shameful as the ones committed by AIG. The department of the Treasury has the responsibility to regulate these matters and they should do so. We must not always turn to tax hikes to solve every problem presented to us in Congress. ”

Sounds like a punt to me

First, I'm not sure that this is a tax penalty so much as a tax. Last I checked Congress had the right to levy taxes, and top Constitutional scholar Larry Tribe seems to think this tax passes muster.

Second, the London argument doesn't impress me either. Let's say that "many" of these execs are exempt from US tax laws. Many is not all. So why not get as much as we can from those who are subject to our tax code?

Third, if these London employees are not subject to US tax law, why would they be liable to a mandate from the US Treasury?

Fourth, contracts are renegotiated all the time in business. Not to mention there are questions as to the validity of these contracts in the first place (see: fraud).

Finally I want to set a precedent that says that if an industry, business or person acts irresponsibly to the detriment of the country then neither they or their employees will profit without reprecussion.

It is a silly argument Kissell is making, that since we can't get 100% we shouldn't go for as much of 90% as possible because Treasury may or may not be able to recoup 100% sometimes later.

Beam Backs Me Up

From Slate:

Unlike the Democrats' solution, which would recoup only 90 percent of the bonuses in a year's time, Boehner says the Republican alternative would get the entire sum in two weeks. But when I asked a Republican leadership spokesman how the bill would accomplish this, the answer was simple: Tell Treasury to get the money back. No matter that Treasury had already determined it could not legally recoup the bonuses once they were paid out. It needs to try harder. For evidence that recoupment by force is possible, the spokesman pointed to a quote from Sen. Chris Dodd, who said the stimulus legislation allowed Treasury to "reach back to these bonuses or compensation packages when they're inconsistent with the TARP legislation or in contrary to public interest." Yet if this were feasible, it's hard to see why the Treasury Department wouldn't have done it by now.

Note that the Republican alternative mentioned here was the one that Kissell supported.

Sorry

I did not know that another thread was up on thin.

no problem

n/t