AIG, Congress, and ex-post-facto taxes
I'm less surprised than I should be to find that Congress is seriously considering an after-the-fact tax to punish the AIG bonus recipients.
Now, I'm not really happy about AIG handing out millions of dollars in bonuses to the people who are largely responsible for the problem, but the time to fix compensation issues is before people are paid. Ideally bonuses should be delayed compensation, based on something like company earnings the five years after the bonus is "earned".
There's a prohibition in the Constitution about passing laws after-the-fact, laws that change the consequences of an action. The point is that people should be able to make plans while aware of the legal consequences of their actions.
To my surprise and dismay, however, the Supreme Court apparently thinks differently, at least as far as tax law is concerned. (Example: United States v. Carlton)
But there really has to be a better way to fix the situation than to establish the precedent that Congress can take money away from anyone they don't like, without warning.
Now, I'm not really happy about AIG handing out millions of dollars in bonuses to the people who are largely responsible for the problem, but the time to fix compensation issues is before people are paid. Ideally bonuses should be delayed compensation, based on something like company earnings the five years after the bonus is "earned".
There's a prohibition in the Constitution about passing laws after-the-fact, laws that change the consequences of an action. The point is that people should be able to make plans while aware of the legal consequences of their actions.
To my surprise and dismay, however, the Supreme Court apparently thinks differently, at least as far as tax law is concerned. (Example: United States v. Carlton)
But there really has to be a better way to fix the situation than to establish the precedent that Congress can take money away from anyone they don't like, without warning.