Lawmakers Tax Bonuses, Point Fingers at Each Other
The partisan blame game over bonuses paid to employees of American International Group ramped up Thursday even as the House voted 328-93 to tax compensation at a 90 percent rate.
The tax measure, which affects employees of companies that have accepted more than $5 billion in federal bailout money, split Republican leadership and rank and file down the middle. Minority Leader John Boehner (R-Ohio) ripped the bill as a coverup for Democrats and voted “no,— while Minority Whip Eric Cantor (R-Va.) voted “yes.—
Republicans were in a tenuous position no matter how they voted. Some of those who supported the bill were violating pledges not to back tax increases. And those who voted against it opened themselves up to Democratic charges that they were blocking punishment of AIG derivatives traders.
Republicans instead sought to pin the blame on the Obama administration, Treasury Secretary Timothy Geithner and Democratic leaders who included a provision in the $787 billion stimulus package that provided a loophole for already-existing bonus contracts like those at AIG.
“This bill is nothing more than an attempt for everybody to cover their butt up here on Capitol Hill,— Boehner said. “It’s full of loopholes. A lot of these people who are getting these bonuses likely live in London — it’s not clear how raising this tax is going to recover that money.—
Some Republicans also charged that the bill was an unconstitutional “bill of attainder— by singling out a small group of individuals for confiscatory taxes.
“I’m voting no,’— House Republican Policy Committee Chairman Thaddeus McCotter (R-Mich.) said. “I took an oath to uphold the Constitution.—
McCotter said Democrats voted to protect AIG bonuses, and “now they are putting up this fig leaf.—
Democrats, for their part, pointed the finger at the Bush administration and the Federal Reserve, which initiated the AIG bailout last year when Geithner was at the New York Federal Reserve. Democrats accused Republicans of suddenly manufacturing outrage about bonuses for executives.
Speaker Nancy Pelosi (D-Calif.) sought to absolve herself of any responsibility for the language in the stimulus package that exempted the AIG bonuses from new restrictions on executive compensation. Instead, she blamed the Senate and the White House for the loophole in the bill.
“This never came to the House side,— she said. “You can talk to any of our conferees. It is a matter of absolute fact and record. … If you want to talk about what happened on the Senate, go on the Senate side and talk to them.—
Pelosi’s comments sparked an outcry from the GOP.
“The Speaker is responsible,— Boehner spokesman Michael Steel said. “The buck stops with her. Her Democratic Members signed the Conference report that contained the bonus language, though it now seems that they never read it. The Speaker chose to bring the bill to the House floor so quickly that no other Member had a chance to read it.—
But Pelosi said the larger issue is that there has been a “lack of regulation, supervision, any discipline— at the financial institutions that caused the crisis.
Jackie Kucinich contributed to this report.