To­day it’s AIG … … to­mor­row Congress may come af­ter you

The Washington Times Weekly - - Editorials -

The power to tax is the power to de­stroy, and when Congress de­cides to tax 90 per­cent of any­thing, it is sow­ing the seeds of de­struc­tion. HR 1586, which passed in the House with light­ning speed and bi­par­ti­san sup­port, seeks to tax away the bonuses paid to AIG ex­ec­u­tives and oth­ers whose cor­po­ra­tions have ben­e­fited from TARP funds. The Se­nate, a more de­lib­er­a­tive body, is more san­guine on pro­ceed­ing with its ver­sion, S 651, which is broader, cov­er­ing busi­nesses that re­ceived much less gov­ern­ment cash, but at a lower 35 per­cent rate. Fi­nance Chair­man Max Bau­cus, Mon­tana Demo­crat, said the Se­nate ver­sion was on cold ice “for the time be­ing. But I don’t know how long ‘the time be­ing’ lasts,” the se­na­tor said Tues­day. “It may be a short time. Ba­si­cally, it’s be­cause there are a lot of ideas.”

The best idea would be to think about it a good bit more. The elec­torate is rightly out­raged at what ap­pears to be a loot­ing of pub­lic cof­fers, but this leg­is­la­tion has all the el­e­ments of an un­con­sti­tu­tional bill of at­tain­der, which raises an un­com­fort­able ques­tion: Who is next?

Not to be over­dra­matic, but it is rem­i­nis­cent of the fa­mous Martin Niemoller real-life poem that goes, “In Ger­many, they came first for the Com­mu­nists,/ And I didn’t speak up be­cause I wasn’t Com­mu­nist;/ And then they came for the trade union­ists,/ And I didn’t speak up be­cause I wasn’t a trade union­ist;/ And then they came for the Jews,/ And I didn’t speak up be­cause I wasn’t a Jew;/ And then ... they came for me. . . . And by that time there was no one left to speak up.”

De­fend­ers of the tax bill say that the ques­tion of con­sti­tu­tion­al­ity comes down to how the bill is writ­ten, and it can pass con­sti­tu­tional muster if it is worded vaguely, broadly, or clev­erly enough. Sen. Charles Grass­ley, Iowa Repub­li­can, who sup­ports sim­i­lar Se­nate leg­is­la­tion and fa­mously sug­gested AIG ex­ec­u­tives com- William Bren­nan, writ­ing for the ma­jor­ity, noted that ques­tions of at­tain­der arise when there are fears that Congress, “in seek­ing to pan­der to an in­flamed pop­u­lar con­stituency, will find it ex­pe­di­ent openly to as­sume the man­tle of judge — or, worse still, lynch mob.” In this Bren­nan ac­cu­rately de­scribes the cur­rent an­gry mood.

The court stated that a crit­i­cal ques­tion in de­ter­min­ing con­sti­tu­tion­al­ity is “whether the leg­isla­tive record evinces a

James Madi­son wrote of the evils of bills of at­tain­der in Fed­er­al­ist 44, call­ing them “con­trary to the first prin­ci­ples of the so­cial com­pact, and to ev­ery prin­ci­ple of sound leg­is­la­tion.” So it is with the un­tracked, un­ac­counted-for TARP funds; Congress giveth, and as hap­haz­ardly taketh away. Those with in­flu­ence in Wash­ing­ton pros­per, those without are thrown to the wolves. The real crime is not the mil­lions of dol­lars of ex­ec­u­tive bonus money but the bil­lions — even tril­lions — the gov­ern­ment is shov­el­ing out to the peo­ple who caused the fi­nan­cial melt­down in the first place.

The Amer­i­can peo­ple are ea­ger to see jus­tice done, but Congress should not com­mit a greater in­jus­tice in their name. This leg­is­la­tion sets a danger­ous prece­dent for a tax agenda that will even­tu­ally reach into ev­ery pocket in Amer­ica. The Congress that to­day can tax away the ben­e­fits of cor­po­rate ex­ec­u­tives can to­mor­row seize what it wills. We sus­pect some pro­po­nents of this “rem­edy” see a new per­ma­nent tax source.

In its hur­ried, fum­bling, ad hoc, self­serv­ing and con­tra­dic­tory re­sponse to the fi­nan­cial cri­sis, Congress must come to un­der­stand that it is at least as much the prob­lem as the so­lu­tion. We urge Congress to find an al­ter­na­tive means of rec­ti­fy­ing this sit­u­a­tion, one that re­spects the Con­sti­tu­tion and does not set a danger­ous and threat­en­ing prece­dent. Fail­ing that, Pres­i­dent Obama should ready his veto pen.

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