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House Approves 90% Tax On Bonuses
March 19, 2009WASHINGTON -- Acting with lightning speed, the Democratic-led House on Thursday approved a bill to slap punishing taxes on big employee bonuses from firms bailed out by taxpayers.
The vote was 328-93.
Said House Speaker Nancy Pelosi: "We want our money back and we want our money back now for the taxpayers."
Republicans called it a legally questionable ploy to paper over Obama administration missteps.
Minority Leader John Boehner, R-Ohio, said the bill was "a political circus" diverting attention from why the administration hadn't done more to block the bonuses before they were paid.
The bonuses, totaling $165 million, were paid to employees of troubled insurer American International Group, including to traders in the unit that nearly brought about the company's collapse.
The bill would levy a 90 percent tax on bonuses paid to employees with family incomes above $250,000. The measure would apply to companies that have received at least $5 billion in government bailout money.
New York Democrat Charles Rangel, chairman of the tax-writing House Ways and Means Committee, said earlier that sponsors "figured that the local and state governments would take care of the other 10 percent."
The Senate has announced its own bill.
Dodd: Executive Pay Provision Diluted
Meanwhile, Sen. Chris Dodd, D-Conn., said he was "completely unaware" of American International Group Inc.'s plans to award $165 million in bonuses.
But he did acknowledge that his staff agreed to dilute the executive pay provision in the economic stimulus bill passed last month.
Had the provision survived, it would have applied retroactively to recipients of federal aid and prevented AIG from making the payments.
Saying he's "the one who has led the fight against excessive executive compensation," Dodd said he did not want to make the changes, but did so at the request of Obama administration officials.
The Senate Banking Committee chairman said those officials, who he did not name, gave him "no indication that this was in any way related to AIG."
Dodd's statement Wednesday came a day after he told CNN that he had nothing to do with the change in the provision.
Over the years, Dodd has been the top recipient of campaign contributions from AIG employees. The Center for Responsive Politics said he received more than $100,000 during 2007 and 2008, when he ran for president.
Thousands Expected To Protest Corporate Excess
Protests scheduled across the country will take aim at banks and executives.
The Partnership for Working Families, Catholics United, Jobs with Justice, United Students Against Sweatshops and political advocacy groups like MoveOn.org called for a day of nationwide protests.
Organizers said thousands of Americans are expected to answer the call and hold demonstrations in front of major banks whose behavior epitomizes an era of CEO and corporate excess at the expense of broader prosperity.
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