AIG BONUS TAX UN-CONSTITUTIONAL

It’s about time someone stood up for the Constitution. The wisdom of our Founding Fathers and the government abuse they could foresee continues to amaze me in its prescience and as a source of stability and comfort for all Americans.

From NBC’s Ken Strickland
While the House acted at warp speed yesterday to pass a tax bill designed to recoup most of the bonus money given to AIG executives, expect the Senate Republicans to slow up the process next week — some by echoing the Founding Fathers and the U.S. Constitution.

While there was strong bipartisan support in House-passed version, it’s unclear where most Senate Republicans stand. The Senate version on the tax bill would impose a 70% excise tax on all retention bonuses given since the beginning of this year. It would apply to companies that received federal bailout money, including AIG.

But is such a dramatic tax on a niche segment of the population constitutional?

“It is wrong,” said Republican Judd Gregg in a statement today, “to propose to use the taxing authority of the government in a manner that is arbitrary, punitive, and targeted on a single group of people who they have deemed as having acted improperly.” While not calling it “unconstitutional,” Gregg’s words seem to align with the sentiments in the Constitution. Addressing Congress directly it says, “No Bill of Attainder or ex post facto Law shall be passed.” (Article 1, Sec 9.)

In the simplest terms, that article prohibits legislation punishing or penalizing a specific person or group without trial. In the Federalist Papers #44, James Madison wrote in 1788, “Bills of attainder, ex-post-facto laws, and laws impairing the obligation of contracts, are contrary to the first principles of the social compact, and to every principle of sound legislation.”

Gregg said Congress’ authority to tax, “is one of the most powerful and important roles of a democratic government, and that power should not be used in a way that undermines its credibility and creates precedents that could lead to significant abuse.” When Senate Finance Committee Chairman Max Baucus and Republican Chuck Grassley first outlined their bill, they signaled legal challenges would await. But Baucus said, “we think this will pass muster” with the courts.