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Correction. The tax is on bonuses of any employee of a bank that received over $5B in TARP funds if that employee has family income over $250k. Recall, that not all banks receiving TARP funds needed them and were asked to take funds so that good banks and bad banks were on the list. The idea was to obscure who was really in trouble for fear that a list of only bad banks would create a run on those banks that had just received tax payer money.

So, presumably, there are people who have done a good job, kept their institutions strong during this difficult time, and will be thanked by having their bonus taxed away.

Change we can believe in!

Oh, and Barak is on Jay tonight! So exciting! So historic!

As distasteful as the AIG bonuses are, I think you've got this right. Bad precedent!

Would one of the regulars with greater financial acumen please explain to me why every AIG bonus either promised or implied wasn't suspended the minute the government assumed receivership?

Because the government didn't assume receivership. AIG isn't bankrupt. Bankruptcy would have allowed the court to negate any existing contract.

Instead, the government invested in AIG by buying preferred stock. Depending on the voting rights, we may be able to eliminate or modify future bonuses, but we can't go in and change existing contracts.

The government assumed receivership in all but name only and the only reason they haven't is that a "formal" receivership would trigger legal steps that has the Helicopter Commander terrified. Liddy serves in the role as trustee in his attempt to break up AIG and sell those units that might fetch some return. That's bankruptcy!

AIG retains the facade of a viable business while they harvest the organs! The corpse is still hooked to the machines but with no hope of recovery.

Also please remember that the government reserves the right to abrogate contracts. Roosevelt voided gold clause contracts and was supported by the courts. Even though this is a mere side show these bonuses should not be paid. What the hell is the fed doing giving money to an insurance company anyway! There are no provisions in the fed charter for that except for this except for the "extraordinary circumstances" clause and if that's the case whats stopping them from using that to do everything including screwing your wife and stealing the silverware?

I've got canned goods and ammunition! Let AIG burn!

I think that you and Tom agree on this one. The thing I would like you to look for as this administration progresses is dissent from Obama's biggest supporters. Because government involves both politics and humans, bad decisions will be made just as bad decisions were made during the Bush administration. I believe that rather than cheerleading those decisions you will see vocal dissent. Geithner has tried to sell us shareholder bailout in at least 6 different color schemes and each time it has been the Democratic base, not the conservatives that have decried the transfer of wealth from taxpayer to shareholder. I think that this is where the Republican Party failed during the Bush years. When bad ideas were proposed and put in action they rallied around the President and even the Democrats got on board for fear of appearing unpatriotic. Obama is a smart man and he does not have a secret agenda to destroy the country as we know it. His attempts to avoid nationalizing all these zombie institutions should be proof enough of that. Throughout the campaign he always said that everyone would have a place at the negotiating table. Big Oil, Labor, The Insurance Industry, whatever groups played an important role would have to be part of the solution. I think he is taking that approach with Big Finance. The key is that he also said that the American people would have a seat at the table, too (unlike Cheney's Energy Commission). It is up to us make our voices heard.
You and some others keep saying that Tom and the rest of us Barak supporters believe he can do no wrong. It is time for you to realize that we are as critical of him as we were of Bush, it just that we actually agree with him on a lot more points.

I didn't understand, when I wrote this, the aspect of the law that Pursuit brought up, but he's right. This is a bad law, as most highly popular laws passed in the heat of the moment are bad. (Did I mention the Patriot Act?)

It's bad in a way that exemplifies what's bad about the rash urges of the Democratic Party -- the same urges that I think Obama has been so good at resisting. That he didn't resist this time -- that he, in fact, was in the lead of the angry mob -- is disappointing. But, contrary to the assertions of several of my regulars, I've never seen Obama as a perfect savior. I expect he'll do other things I don't like too, some of them purely by mistake and others out of craven political self-interest.

The only way to get my version of absolute perfection into office would be to elect me, and you'll have to do that without my support. I mean, I know that guy, and he'd be a crappy President.

The only way to get my version of absolute perfection into office would be to elect me, and you'll have to do that without my support. I mean, I know that guy, and he'd be a crappy President.

I'm not sure that you would be any less competent than....oh, say the last 43! I still have my doubts about George Washington!

I think that, the scary thing is that the AIG bonus guys are the boogeymen... of the present.

And this Liddy guy, he was pulled out of retirement to work for $1 a year as a philanthropic favor to salvage whatever may be salvaged, only to get grilled and scapegoated by a bunch of preening legislating assholes who actually need him much more than he needs them?


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