{"id":1775,"date":"2009-03-23T17:55:03","date_gmt":"2009-03-23T21:55:03","guid":{"rendered":"http:\/\/www.jasetaro.com\/blog\/?p=1775"},"modified":"2009-03-23T17:56:07","modified_gmt":"2009-03-23T21:56:07","slug":"unintended-consequences-aig-bonus-tax-could-have-painful-side-effects","status":"publish","type":"post","link":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/23\/unintended-consequences-aig-bonus-tax-could-have-painful-side-effects\/","title":{"rendered":"Unintended Consequences: AIG Bonus Tax Could Have Painful Side Effects"},"content":{"rendered":"

Haste makes waste my grandmother used to say… When it comes to legislation haste often leads to unintended consequences. Take for example congresses rush to pass a 90 percent tax<\/a> on the retention bonuses paid to executives at AIG (emphasis mine):<\/p>\n

Lawmakers bellowed with outrage last week following revelations that AIG was paying millions in bonuses to employees at a rogue division based in suburban Connecticut.<\/p>\n

But the bonus restrictions House members prescribed in response — a 90 percent tax on those bonuses — could have painful side effects for the subsidiaries of other bailed-out financial companies, including one located just a few miles away from the troubled AIG unit.<\/p>\n

Phibro, a commodities trading company located in Westport, Conn., potentially could be hit with the 90 percent tax on bonuses since its parent company, Citigroup, has received $45 billion in bailout money.<\/p>\n

Phibro, though, has not actually taken federal rescue funds and is considered a relatively stable and profitable subsidiary of Citigroup.<\/p>\n

The subsidiary side effect is just one example of the complications the House-passed bill could create if such a measure clears the Senate and heads to President Obama’s desk.<\/p>\n

U.S. Rep. Jim Himes, D-Conn., who represents the district where Phibro is based, said the bill is “undoubtedly replete with unintended consequences” — the product of what he called “hasty work.”<\/p>\n

~ ~ ~<\/h3>\n

But the Connecticut Democrat said he expects the Senate to work up an entirely different bill to address excessive bonuses. He said the House version was a “signal” to taxpayers that Congress is paying attention to the issue<\/em><\/strong>, but not a final product.<\/p>\n<\/blockquote>\n

Excuse me??? With all due respect Congressman, we expect our elected leaders to act like adults. Not to run off half cocked and rush to pass a hastily crafted, unconstitutional Bill of Attainder to send a signal.<\/p>\n","protected":false},"excerpt":{"rendered":"

Haste makes waste my grandmother used to say… When it comes to legislation haste often leads to unintended consequences. Take for example congresses rush to pass a 90 percent tax on the retention bonuses paid to executives at AIG (emphasis mine): Lawmakers bellowed with outrage last week following revelations that AIG was paying millions in […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","advanced_seo_description":"","jetpack_seo_html_title":"","jetpack_seo_noindex":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[26,7],"tags":[128,521,536,1365],"class_list":{"0":"post-1775","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-economy","7":"category-politics","8":"tag-aig","9":"tag-bonuses","10":"tag-jim-himes","11":"tag-taxes","12":"entry"},"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/pfpI7-sD","jetpack_sharing_enabled":true,"jetpack-related-posts":[{"id":1730,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/20\/the-last-grownup-john-kyl-puts-the-breaks-on-rush-to-tax-aig-bonuses\/","url_meta":{"origin":1775,"position":0},"title":"The last Grownup: John Kyl Puts the Breaks on Rush to Tax AIG Bonuses","author":"Jeff","date":"March 20, 2009","format":false,"excerpt":"We got into this mess because Congress and the administration rushed through the Stimulus bill without sufficient time for legislators to review and debate the bill. Now Congress is trying to compound one set of mistakes with another by rushing through a bill to tax the retention bonuses paid to\u2026","rel":"","context":"In "Politics"","block_context":{"text":"Politics","link":"https:\/\/www.jasetaro.com\/blog\/category\/politics\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1695,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/17\/the-hits-keep-coming-chris-dodd-was-for-aig-bonuses-before-we-was-against-them\/","url_meta":{"origin":1775,"position":1},"title":"The Hits Keep Coming: Chris Dodd Was For AIG Bonuses Before He Was Against Them","author":"Jeff","date":"March 17, 2009","format":false,"excerpt":"From Fox Business (emphasis mine): Senator Chris Dodd (D-Conn.) on Monday night floated the idea of taxing American International Group (AIG: 0.9194, 0.1393, 17.86%) bonus recipients so the government could recoup some or all of the $450 million the company is paying to employees in its financial products unit. Within\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1708,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/19\/congressman-mccotter-slams-stimulus-yes-voters-for-protecting-aig-executive-bonuses\/","url_meta":{"origin":1775,"position":2},"title":"Congressman McCotter Slams Stimulus “Yes” Voters for Protecting AIG Executive Bonuses","author":"Jeff","date":"March 19, 2009","format":false,"excerpt":"I'm about ready to make Rep. Thaddeus McCotter of Michigan my adopted Congressman: \"Facts are hard things to disprove.\u00a0 Every single Democrat in this House that voted for that bill voted to approve and protect those AIG bonuses.\u00a0 Every single Democrat in the Senate that voted for that stimulus bill,\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1700,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/19\/chris-dodd-was-against-aigs-bonuses-before-he-was-for-them\/","url_meta":{"origin":1775,"position":3},"title":"Chris Dodd Was Against AIG’s Bonuses Before He Was For Them???","author":"Jeff","date":"March 19, 2009","format":false,"excerpt":"It's getting so you can't follow the twist and turns in the AIG retantion bonus kerfufle without a map... It now looks like Chris Dodd was against the bonuses before he was for them but now he's against them: For a while, the disappearance of an executive bonus restriction from\u2026","rel":"","context":"In "Politics"","block_context":{"text":"Politics","link":"https:\/\/www.jasetaro.com\/blog\/category\/politics\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1811,"url":"https:\/\/www.jasetaro.com\/blog\/2009\/03\/26\/let-the-exodus-begin\/","url_meta":{"origin":1775,"position":4},"title":"Let the Exodus Begin…","author":"Jeff","date":"March 26, 2009","format":false,"excerpt":"Jake DeSantis may have been the most public buts he's not the only one at AIG Finacial Products who's cleaning out his desk: NEW YORK (Reuters) - Several more employees are leaving the controversial financial products unit that brought American International Group Inc to its knees last year, according to\u2026","rel":"","context":"In "Economy"","block_context":{"text":"Economy","link":"https:\/\/www.jasetaro.com\/blog\/category\/economy\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3151,"url":"https:\/\/www.jasetaro.com\/blog\/2010\/01\/07\/bloomberg-geithners-fed-told-aig-to-limit-swaps-disclosure\/","url_meta":{"origin":1775,"position":5},"title":"Bloomberg: Geithner’s Fed Told AIG to Limit Swaps Disclosure","author":"Jeff","date":"January 7, 2010","format":false,"excerpt":"In a sane world Tim Geithner's tax troubles would have kept him from being confirmed as Treasury Secretary. Unfortunately, we don't live sane and those tax troubles pale in comparison to what we're learning about the Geithner led Federal Reserve Bank of New York's role in the AIG bailout: The\u2026","rel":"","context":"In "Culture of Corruption"","block_context":{"text":"Culture of Corruption","link":"https:\/\/www.jasetaro.com\/blog\/category\/culture-of-corruption\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"jetpack_likes_enabled":true,"_links":{"self":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/1775","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/comments?post=1775"}],"version-history":[{"count":0,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/posts\/1775\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/media?parent=1775"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/categories?post=1775"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.jasetaro.com\/blog\/wp-json\/wp\/v2\/tags?post=1775"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}