How Can They Do That?
Thursday, March 26, 2009
Those AIG bonuses really tick me off. Not that the employees are receiving them, but the overly dramatic wringing of hands that is going on in Washington.

Sen. Chris Dodd specifically allowed the bonuses. The Obama administration knew about them. Now, all of the sudden, they are outraged? People are threatening AIG employees with piano wire, and Sen. Barney Frank refuses to keep the names of bonus recipients confidential for their own safety?

Here's the thing.

Those employees of AIG? They have an employment contract. If they do XYZ, they'll get a bonus. They did XYZ. They get a bonus.

Can you imagine if you opened your check on payday, and found you were paid minimum wage instead of your usual salary - the salary negotiated and agreeed upon in your employment contract?

What if people in the oil industry, for example, are suddenly targeted as being undeserving of the money their employer agreed to pay them in a private contract? What if Texas decided to enact a 90% income tax on all moneys paid by oil companies?

What if it was you? What if you agreed to stay with AIG to try to steer them through the crisis, even though other companies offered you good jobs, waiting for the payout at the end?
What really stinks is that it is our money being spent - but it's legal.

I heard that it is unconstitutional, prohibited by the Bill of Attainder. Believe it or not, we did not study the Constitution in my Civics or American History class (Malcolm X - totally covered, though).

I had to look it up.

It's in Article 1, Section IX of the Bill of Rights.

Section 9: The migration or importation of such persons as any of the states now existing shall think proper to admit, shall not be prohibited by the Congress prior to the year one thousand eight hundred and eight, but a tax or duty may be imposed on such importation, not exceeding ten dollars for each person.
The privilege of the writ of habeas corpus shall not be suspended, unless when in cases of rebellion or invasion the public safety may require it.
No bill of attainder or ex post facto Law shall be passed.
No capitation, or other direct, tax shall be laid, unless in proportion to the census or enumeration herein before directed to be taken.
No tax or duty shall be laid on articles exported from any state.
No preference shall be given by any regulation of commerce or revenue to the ports of one state over those of another: nor shall vessels bound to, or from, one state, be obliged to enter, clear or pay duties in another.
No money shall be drawn from the treasury, but in consequence of appropriations made by law; and a regular statement and account of receipts and expenditures of all public money shall be published from time to time.
No title of nobility shall be granted by the United States: and no person holding any office of profit or trust under them, shall, without the consent of the Congress, accept of any present, emolument, office, or title, of any kind whatever, from any king, prince, or foreign state.

Let's look again.
No bill of attainder or ex post facto Law shall be passed.
Bill of attainder = A bill of attainder, is a legislative act which inflicts punishment without judicial trial and includes any legislative act which takes away the life, liberty or property of a particular named or easily ascertainable person or group of persons because the legislature thinks them guilty of conduct which deserves punishment.

It's supposed to keep the legislature from doing the Justice Department's job.

The real problem is that the taxpayers own 80% (I heard) of AIG - but are not doing what normal stockholders do. Normally, if someone owns 80% of the stock in a company, they hire and fire the board of directors. The Board appoints the CEO. If things don't go well, a new board and a new CEO might be in order.

The Federal government can't really (or won't) do that. No one's minding the AIG store, but we're outraged when they don't do what we think they should do. Our government instead tries to meddle in private contracts, making them null and void.

Bad, bad idea.

I think that AIG should honor their contracts. Our whole economic system, government, and the American way of life rests on the notion that contracts are binding.

Hmmm, I saw something else very interesting ...
a regular statement and account of receipts and expenditures of all public money shall be published from time to time.
Can't wait to see that report on the stimulus bill. We can't even keep track of the spending of one bailout of one company (AIG) - how on earth can all of those trillions be accounted for?


posted by Milehimama @ Mama Says at 3/26/2009 08:13:00 AM | Permalink | |