It’s absolutely amazing to me how quickly Democrat leadership has devolved into a farce! I knew it would happen but I thought it would take a little longer. This AIG mess has demonstrated that the Democrats are the Keystone Cops when it comes to solving problems they’ve created. First, they blather on and on about how shocked they were that AIG executives were getting bonuses and went on the blathering head shows screaming about how wrong is was and promising to do something about it, fomenting hatred against these executives and trying to out them to the point that these poor people now fear for their life.
Then it turns out that Senator Dodd not only knew that they were getting bonuses, he actually put the language in the bill. And not only that, he did so because Treasury asked him to do so.
Of course Obama claims he was “stunned” by the bonuses but it turns out he wouldn’t have been if he had listened to his fellow Democrats question his Treasury Secretary, Geithner on March 3:

But yesterday, Mr. Secretary, the Treasury and the Federal Reserve announced a new fourth plan to rescue troubled financial services giant AIG. I do agree that AIG’s sustainability is the lynchpin for some of our recovery efforts, and it’s important for the federal government to work to keep it afloat. However, I must demand that AIG increase the accountability and transparency, something that was not done during the previous administration.
For example, just last month, AIG paid 343 employees of AIG FP — their Financial Products division that created the financial hole that AIG is in, and in turn a multibillion-dollar bill for American taxpayers — $56 million in bonuses and are slated to pay an additional $162 million in bonuses to 393 participants in the coming weeks. And there’s more. Further bonus payments totaling approximately 230 million (dollars) are due to 407 participants at AIG’s Financial Products division in March 2010. This makes no sense to my constituency.

So, having passed legislation to do the very thing they were complaining about, the Democrats decided not to let their duplicity stop them and they passed a onerous, unconstitutional tax on the executives who received the bonuses (even though some of them are exempt from our laws since they are foreigners).

But in their incompetence the Keystone Cops Congress is actually doing the taxpayer a huge favor. What executive would want to borrow money from the government with these types of strings attached to it? What executive would want to work at AIG or other institutions when it would mean that their bonuses would be taxed at 90%? Those companies that take TARP money will suffer from executive flight and won’t be able to attract talent. And what company would trust the federal government after this? What other laws will they pass if they feel like it? Paying back the money at 50% interest rate?
Thanks, Congress for making the TARP money so unattractive that companies will avoid it and give it back quickly. Of course if the Democrats actually thought the TARP money was necessary for opening up credit and necessary to keep these companies in business, this move wasn’t exactly helpful.