Wednesday, March 18, 2009

Worse than AIG

Let's begin by stipulating for the sake of argument that everything about AIG and these bonuses is as bad as their critics are stating. In this post or elsewhere, I am holding no brief for AIG. Nonetheless, the most disconcerting thing about this entire mess is the way that U.S. lawmakers and government officials have responded to it. Those responses should give every American -- left, right, and center -- pause. Consider:

In his opening statement to Edward Liddy at today's House Finance Committee subcommittee, Chairman Paul Kanjorski (D-PA) sternly told Mr. Liddy that he should have committed a civil tort. Making reference to a practice that Mr. Liddy's previous employer, Allstate, has often been accused of, Chairman Kanjorski told the witness that even if he and his legal team believed the contractual obligation to pay bonuses to be airtight, they should have still refused to pay the bonuses and forced the employees to take them to court. For a lawmaker publicly to advise a private citizen to commit a tortious act is amazing, indeed.

Of course, this follows the threats of Sen. Charles Schumer (D-NY), Sen. Dianne Feinstein (D-CA), and others, who advised the AIG executives that they faced the choice of either returning the bonuses voluntarily or paying them as taxes under legislation that they promised to get passed. This threat has not gotten the attention it should. Sen. Schumer is contemplating using the tax code as a means of retroactively targeting specific individuals from a specific company in order to confiscate monies that they received legally. This is fascism pure and simple.

Of course, making sure that deplorable behavior by congressional leaders is a bipartisan affair, Sen. Charles Grassley (R-IA) urged the same executives to either resign or commit suicide. He has since apologized, but, really, what decent person says this kind of stuff?

They really are worse than AIG

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