James, if these people are good at what they do, maybe they figure they'll take a sack on first and ten to be within field goal range on the next play.

You know, power players have always had the option (pardon the pun) of locking in for long-term capital gains.

It's been one theory that encouraging management to take that path, among other things, led to more stable institutions.

As we move forward, to what is necessary, let's think about the incentives, and how much "bonuses" need to be protected.

Frankly, I’m astounded that someone would return a bonus of $6.4 million rather than take a permanent vacation to Aruba or somewhere else outside the taxing jurisdiction of Congress.

Having been pretty hard on those guys meownself, I'm perfectly prepared to eat a large helping of crow--I 'd like to think they're putting patriotism above profit.

Call me a cynic, but I'd guess someone who gives back $6M probably has $100M he's hoping to keep quiet.

I don't know that the people returning the bonus money is all that astounding.

After all, over the past week, they've dealt with the AIG rage, the confiscatory tax passed by the House, and people taking bus tours of the neighborhoods where these people live.

Is it really all that surprising that they'd just give up ?

Professor Tribe, of late, would differ:

Tribe says the main problem is that it’s hard to make the case that the law isn’t “punitive.”

“Its punitive intent is increasingly transparent,” Tribe says. “when you have Chuck Grassley calling on [executives] to commit suicide, and people responding to pitch fork sentiment, it’s hard to argue that this isn’t an attempt to punish an identifiable set of individuals who are the subject of understandable outrage.”

The whole point of opposing bills of attainder, Tribe says, is to prevent what some have called “trial by legislature.” Tribe concludes: “That’s the primary vulnerability.”

LINK

One thing that might be crossing Obama's mind right now, is how great of a case study that a court decision would be for a Constiutional Law textbook. He could also predict that the tone of discussion would not be respectful towards him.

Call me a cynic, but I'd guess someone who gives back $6M probably has $100M he's hoping to keep quiet.

You can tell what kind of fish a man has caught and kept by what he throws back.

Pete Burgess is exactly right. There are sums being thrown around now that make $160 million look like chicken feed and these guys want to be first in line for the golden crumbs that fall off the golden cakes.

Who do you think is going to be on the front lines of the taxpayer giveaway that Geithner revealed yesterday? Fees, glorious fees. If not via AIG, then these guys will move to some company handling the fire sale.

Long term impact is what matters. Short-sighted Dems are seeing cash today but not seeing the impact on tomorrow. Right now, many of these financial companies are making plans to move more of their operations to London or Dubai. NYC will be the big loser here as they feed off the taxes on financial types.

Not to mention, this is advantage foreign financier, disadvantage US citizen financier. And these guys really can move to France.

One question that I haven't seen addressed here with anything other than thoughtless derision, is what do these people have that makes them so highly-priced? Two things: specialized knowledge, and personal relationships with the other players in the game. Intellectual capital is extremely portable, and its fungibility depends on institutional measures that I'd be willing to bet are lacking at many of these firms. Personal relationships are highly portable, and not fungible at all except at the entire discretion of the specific individual with the relationship.

Financial firms are built entirely on three pillars. The two mentioned above, plus financial strength. American financial firms have already lost that pillar, and it's going to be hard enough to prop it up without yanking the other two out from under.

Bad policy? It would take a great deal of improvement for this to even rise to the level of short-sighted.

And immediately after posting my last comment, I see this:

The Obama administration is considering asking Congress to give the Treasury secretary unprecedented powers to initiate the seizure of non-bank financial companies, such as large insurers, investment firms and hedge funds, whose collapse would damage the broader economy, according to an administration document. The government at present has the authority to seize only banks.

Giving the Treasury secretary authority over a broader range of companies would mark a significant shift from the existing model of financial regulation, which relies on independent agencies that are shielded from the political process. The Treasury secretary, a member of the president's Cabinet, would exercise the new powers in consultation with the White House, the Federal Reserve and other regulators, according to the document.

I am looking forward to the contortions certain parties are going to go through to explain how this is a wonderful thing, not really nationalization, not really a naked political power grab, and Timmy will do a heckuva job with it.

Any talk of the politicians giving back campaign contributions? Or is that just their way of supporting public funding of elections?[lol]

Not to mention, this is advantage foreign financier, disadvantage US citizen financier. And these guys really can move to France.

Because French taxes are so much lower?

The slaughtering of one's own children is constitutional too. Evil people can find pennumbras and emminations anywhere they want.

Jack Balkin has spoken, his words reverberate around the mountain tops of timeless wisdom, wise men drop to their knees, arguments cease, debate ends.
However; "A bill of attainder was a legislative act that singled out one or more persons" etc. Justice Reinquest. What was Balkin saying about one person only?
"Bills of attainder, ex post facto laws, and LAWS IMPAIRING THE OBLIGATIONS OF CONTRACT are contrary to first principles", etc. James Madison
I would say that like it or not there has definitely been some contract impairment here.
Though the quicker you dismiss something the less time you have to consider the weakness of your argument.

johnt,

What's your point ?

All the relevant case law indicates that Balkin is right about the Bill of Attainder issue.

And the bar against laws impairing contractual obligations only applies to the states.

Next time, read the Constitution before you type.

Doug Mataconis, thanks for the tip.
"No Bill of Attainder or ex post factor law shall be passed"
There, I've read the Constitution as you advised, what next? Oh yeah, case law. Maybe I'll try United States v Brown or ex parte Garland, maybe you will also. Maybe there's a few others as well.
And I just know you're not going to tell me that impairing contracts is prohibited only to states, wonder what federal case law is on that, wonder for that matter what the Constitution and it's ratification would be considered?

Frankly, I’m astounded that someone would return a bonus of $6.4 million rather than take a permanent vacation to Aruba or somewhere else outside the taxing jurisdiction of Congress.

A friend asked me that 2 days ago. Why don't these crooks flee the country? I don't really have a good answer for that.

Johnt,

To answer your last question first -- Article I, Section 10 of the Constitution says as follows:

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.

There is no comparable provision that applies to Congress. Therefore, the Constitutional provision barring laws impairing contractual obligations does not apply in this context.

As to your second point, the legislation being considered by Congress would apply to anyone who receives a bonus from any entity that received more than $ 5 billion in TARP funds and isn’t just limited to recipients of bonuses from AIG, it is likely general enough to get past any question that it is an unconstitutional Bill of Attainder.

Doug -
Don't the 9th and 10th amendments come into play here? The lack of enumeration of a right does not deny or disparage it; the rights not granted to the US are reserved to the states or the people. Thoughts?

Phil,

Sadly, the 9th and 10th Amendments are largely irrelevant in modern Constitutional jurisprudence.

Even if they weren't I don't think they'd apply in a case like this.

All the relevant case law indicates that Balkin is right about the Bill of Attainder issue.

And we know this because Prof. Balkin cited all of the relevant caselaw? Professor Tribe has argued at least one bill of attainder case (they are not common) and supposes differently.

I wish that Prof. Balkin would show his work on the due process and takings clause issues, because it appears clear to me that property is being taken (although not real property) and that even interpreted as a regulatory taking (and not a punitive matter), the taking is confiscatory, particularly coupled with other taxes bringing the confiscation to over 100%.

The case law is easy enough to find for yourself.

And Tribe's recent comments don't say that he definitely believes there are attainder problems here, by the way.

Also, it's worth noting that this entire conversation is likely academic --- it's fairly clear that the 90% tax that passed the House will not make it through the Senate and the bill the Senate is considering is far less punitive.

And if that's the bill that ends up becoming law, then there will be no possibility of a Constitutional objection.

PD,

It's also worth noting that the whole "regulatory taking" argument is interesting from an academic point of view but has never found any support in the Supreme Court.

Doug, almost a nice try, almost. If however I need someone to read the constitution to me be assured I'll e mail you.
To repeat and expand, I know that your position on contract is not such as to prohibit impairment to the states but allow it for the federal government. And if you don't allow it then on what basis is it there also prohibited. You do leave that unfortunate thought open. I will hold reasons and examples in reserve.
Doug, your 2nd para, as with Balkin's approach, is shall we say, wrong. To claim an exception based on a "abstract" group is too slick by half. Try "ascertainable" rather than abstract, why not, that's the phrase the Supreme Court uses.
Bills of attainder may or may not name specific individuals, abstract or ascertainable will do just fine.
Belkin's claims of impartiality and regulative purpose is, sorry, crap, and no reflection on you Doug. Put it to you this way, were I an attorney responding in a court case and to Belkin's argument the first thing I'd do is ask for a change of venue, maybe Bolivia or Gabon. If denied I would cite the Congressional Record, various and unnumbered media sources, the use of federally funded advocacy groups for purposes of harassment and intimidation, the wish and threat to publish AIG employee's name in tha papers, and other examples of nascent Hitlerism to counter Belkin's what, fantasy.
Then again the Congressional record might be just enough.
I've gone on too long, my apologies.

To repeat and expand, I know that your position on contract is not such as to prohibit impairment to the states but allow it for the federal government. And if you don't allow it then on what basis is it there also prohibited. You do leave that unfortunate thought open.

No, I am simply telling you what the Constitution says. There is one clause that forbids laws impairing contractual obligations. It is in Article I, Section Ten. And it clearly only applies to the states.

What's your point ?

Doug, right! see you around.