Don't usualy post Political issues, but this one concerns me...

[TrepMan]

OK the house just passed a bill (HR 1586) that slaps " punishing taxes on big employee bonuses at firms bailed out by taxpayers. The bill would impose a 90 percent tax on bonuses given to employees with family incomes above $250,000 at American International Group and other companies that have received at least $5 billion in government bailout money."



What causes me concern is not the concept (though personally i'd like to see the Fair Tax instead of any progressive income tax, but thats a different discussion), what concerns me is this example I quickly came up with, tell me if I am right:



1. Husband and Wife are both college educated, live in a major city (NY, Chicago...) and both are middle managers at some company, say making $100k salary each per year, and have a couple of kids. Mom and Dad both work.

2. Mom's company starts to go under, she's been there 25 years working her way up to manager, and the company ends up recieiving bailout money.

3. Mom's income each year has included a bonus based on her personal performance (think sales, finance, operations...) and same with dad, so each year as they are their late 40's or early 50's, they have been getting $20-30k each in bonus every few years when they do really well.

4. Now they make over $250k combined family income, and in a city like NY or Chicago, where housing costs and living costs are huge, Mom will now lose her $20-30k yearly bonus (well get it and be taxed 90%+. That actualy takes $$ away from her for working so hard for 20+ years in the company.



Am I thinking right? So I realize the "outrage" on AIG bonuses are on multi-million $$ payouts to execs in a company going down the toilets, but I would have thought they would have our goverment might have tried something like "90% tax on any bonus for a company taking bailout money, if the bonus is over $20k or the salary of the employee is over $500k" as an example.



I realize in a bad economy ANY company can cut salaries, cut bonus, and as a tax payer I don't want my $$ going to idiots or overpaid paper pushers, but for the government to set a family salary threshold for bonus's instead of a bonus threashold, scares me.



Thoughts? (and this is not aimed at any party, as both Democrats and a lot of Republicans voted FOR this one)

 

[Texas Transplant]

Probably only going to take about 10 minutes to be challenged in Federal Court, I suspect - as being un-constitutional. Just because the idot's in Congress passed it, doesn't mean that it will sick.



Hopefully so.



This is nothing more than a 'penalty' on a targeted group.



Tex

 

[Brian Ingersoll]

What scares me is they are using the tax system to punish employees of certain companies. This could be the first step to set a precedent for other enequitable taxes.

 

[Rick Cohoon2]

Mr. Obama and his thugs are defelcting attention with this outrage. They knew about the bonus' and thought no one would care, then they got caught. So out comes th4e rightious indignation. I do not think the law will stand or hold up.

 

[Rick Weinberg]

I see one flaw in your theory, you assume the Company is as loyal as the employee.

25 years and middle management your the first to go, to much in salary,benefits, and bonus.

 

[Berry Lindley]

I'm pretty conservative, but I'm with them on this one. I think I might could squeeze by on 250K. Once the bailout loan is paid back the sky's the limit again.

 

[Rich Stern]

Trep, this is why government sucks at this kind of stuff. They see a penny nail sticking up, they hit it with a sledgehemmer. And never mind the consequences.



Did you catch the hearings with the CEO of AIG? He tells the house committee that some of the execs and managers are getting death threats, and he'd prefer not to name them on national television. What does Barney Frank do? Threaten him with a subpoena to force him to say the names.



The first mission of government is to protect citizens.



Another critical mission of government is NOT to interfere with private agreements (like employee contracts) except to resolve disputes between the parties in a civil court.



These guys are so far off course, they have no chance of ever getting back.

 

[Edward Lea.]

The bill is unconstitutional and will fail when challenged in the supreme court. But they already know that they are hoping the public will not pay any attention when that happens. Right now the house and congress is running for re-election in 2010. This whole fake outrage by everyone in washington is such a disgrace and I hope the public remembers when they vote. Yeah the bonuses are shamefull but so is what congress did with the loop hole and this stupid tax bill. I hope Dodd's people back east remember his lying when they vote next year.



Can Anyone out in Conn. give us an idea of how public sentiment is blowing on Dodd? We can't really trust what the media reports any more.

 

[Marty Klein]

It's hard to fully understand what's going on simply because our distance from ground zero prevents us from knowing all the facts. However, I believe Congress's intent is not really to target folks like you exemplify. Rather, they want to target the head of that penny nail who, while responsible for the debacle and massive losses, get excessively high performance bonuses. I think that is a lofty goal and side with Congress in their effort.

 

[Tim Koepp]

I see both sides. however, there is a key driving factor. My own company pays performance bonuses, driven by a calculation of company Profit attainment repeat PROFIT not gross revenues etc, times a % for personal performance appraisal. Net result, top performers are able to participate in the PROFITABILITY of the company.. no profit? no bonus. Problem solved.

 

[Bill McElroy]

Totally agree with Rich.......this Admin is beyond F'd up!! Barney Frank is a complete and total POS!! :angry:

 

[TOMMY RICH]

They're trying to backpeddle...

If they'd look at this crap BEFORE giving them "bailout" money...there wouldn't be a problem!

And yes...what a bunch of morons in the house:wacko:

 

[TrepMan]

Marty - I can agree with the "they want to target the head of that penny nail who", which is why I can't understand (other then Obmama specifically said he' raise taxes on those families making over $250k/year) why they didn't write the bill better (or republicans pushed for better wording).



Trep

 

[Dan J.]

Trep - The Republican party (in its majority) tried like Hell to get this bailout debacle killed before all of this recent mess raised its head. They were ignored and publicly chastised for their lack of "bi-partisanship" for NOT rolling over and letting the bailout go unchallenged. (Remember the, "We have to do this now - <i.e: don't look through the bill and see all the self-serving, liberal unrestraint of additional crushing debt> - or the world will come to an end!!" LOL!! WHAT A LOAD OF CRAP!!!!) Personally, I feel the three so-called Republicans that sided with the Devilcrats and pushed this down all our throats should be removed from the party and left to fend as independents or join their liberal simpleton buddies across the aisle! Pelosi, Dodd and Frank are the new Axis of Evil in D.C. working the strings on their Pinnochi-Obama puppet. (Watch his nose! :lol: ) They brought change alright. The past two plus years of Dem control has created untold opportunities and wealth for the poor, unprivileged, uneducated and most ne'er do wells. Crime is on a drastic rise and taxes are coming along for the ride!! :angry::angry:

 

[Jody Woodruff]

Doesn't surprise me considering the Democrats have been waging war on taxpayers for 30 years. I know a lot of people that make 250K+ and they worked their butts off to get to that level and it makes me sick knowing people are fine with taxing them more "because they can afford it". If people in this Country would spend more time worrying about taking care of their own business and less on what the other guy is making we would be better off. Don't get me wrong, I am pissed too with the AIG mess but using the IRS as a weapon is a dangerous road to go down. This current bill is nothing more than a ploy of the idiots in D.C. to get the people of their backs and save their seat. They know full well it's unconstitutional but it provides cover for them to hide behind. We need term limits!!

 

[Berry Lindley]

Whoa, Now. The segment of AIG that caused this debacle is the arm with executives, individually, getting over a million. And they are still in the red. If they get back in the black, that is their business. I am not talking about taxes going up, that is another story, and I vigorously protest.

 

[TOMMY RICH]

Hmmmmmm...going down the tubes and bonuses go hand in hand?

 

[TrepMan]

Berry - I agree 100% on 'executives, individually, getting over a million', BUT thats not what the law they passed said! it specifically called out families making over $250k bonuses from companies recieving bailouts getting hit with a 90% tax on the bonus (basically nullifying the bonus, and in this case nullifying legally binding contracts). So what if they decide to lower the bar to $200k? Families making $100k? you ok with the government deciding the legal contract between you and your employer is null and void?



Which is why I suggested - "90% tax on any bonus for a company taking bailout money, if the bonus is over $20k or the salary of the employee is over $500k" as an example.



As an example. Heck make it if the salary of an employee is over $250k NOT the family income.



Let me add one more example that concerns me:



1. Employee A makes $225k/year in AIG, Employee B makes $75k/year in AIG

2. Employee A's wife does NOT work, thus his family income is $225k

3. Employee B's wife DOES work, and happens to own a small business and makes $200k/year



Given the current law, Employee A DOES get to keep his bonus but Employee B does not! I'm with ya on all or nothing on bonus's at a failing company (though don't we want to incent leaders/inovators/change agents who take a company that is loosing $10m a year and bring it to only loosing $5m a bonus? That would be a $5m increase in the company!).

 

[Gene B]

Don't rely on the supreme court to overturn this because it's unconstitutional. They let the McCain-Feingold bill stand when it clearly impeded our free speech rights.



Gene

 

[Texas Transplant]

Now we find that our President, has now stated he thinks it's a bad idea. Mark this, as his first real situation, where he is changing direction based upon public opinion and polls.





Tex

 

[Bill McElroy]

TT,..his change in attitude is probably based a LOT more on legality issues vs. public opinion. But he better get use to "change"......he's going to find out real quick that most people don't want the kind of CHANGE he's proposing!!