For Release: March 20, 2009
Contact: David Almasi at (202) 543-4110 x11 or
Congress Betrays Ideals of America's Founding
New York, NY - Legislation to specifically target AIG employees with a 90 percent tax on retention bonuses directly conflicts with the founding principles of the United States, Project 21 Fellow Deneen Borelli charged today on the Fox News program "Strategy Room."
Saying Article I, Section 10 of the U.S. Constitution prohibits the government from passing laws "impairing the obligation of contracts," Borelli says the AIG bonus controversy is a creation of the lawmakers who rushed bailout legislation earlier this year without due consideration. These are the same lawmakers who now seek to hide their mistakes by pushing this new and selective tax.
"Politicians need to be reminded that we are a nation of laws. To impose a hastily-concocted tax as a means of rectifying a problem that the government itself created and mismanaged calls their ability to lead into question," says Borelli. "To suddenly enact a new tax to punish a few dozen people for something that was legal at the time is ludicrous, and it smacks of the British treatment of the colonists that provoked the revolt that created the United States. Have we come full circle already?"
Borelli says the selective and punitive tax proposed for these AIG executives harkens back to taxes imposed on the American colonies under British rule during the 1700s.
The Stamp Act of 1765 required all legal documents, newspapers and even playing cards to carry a tax stamp. The tax, levied to pay for British troops stationed in the colonies, brought about the argument of "taxation without representation" and led to the organization of resistance groups such as the Sons of Liberty.
Similar British taxes specifically targeting the colonies included the Townshend Act to tax import of glass, lead, paint, paper and tea and the Tea Act, which cut colonial tea merchants out of the market and led to the Boston Tea Party.
Borelli also noted on Fox News today that it was an amendment pushed by Senate Banking Committee Chairman Chris Dodd (D-CT), apparently at the behest of the Obama White House, to February's rushed $787,000,000,000 "stimulus" bill that ultimately allowed the AIG retention bonuses to be paid.
"Americans have every right to be angry that their tax dollars are paying for these bonuses, but the blame should start with Congress," she said. "Retention bonuses such as AIG's are commonplace, and apply to more than just executives. Senator Dodd and the Obama Administration must have known this when they pushed the amendment that allowed the bonuses to be paid. Now, lawmakers including Dodd are trying to play a game of bait-and-switch. They are trying to draw attention away from themselves and onto AIG. AIG CEO Edward Liddy and others at the company were playing by the rules that were given to them by Washington. A special tax for these few, while possibly making people feel better, is akin to tyranny."Borelli added: "If this government is unable to provide simple oversight on the bailouts they approved for a few banks, how can they effectively manage health care for hundreds of millions of Americans?"
Project 21, a nonprofit and nonpartisan organization sponsored by the National Center for Public Policy Research, has been a leading voice of the African-American community since 1992. For more information, contact David Almasi at (202) 543-4110 x11 or [email protected], or visit Project 21's website at www.project21.org/P21Index.html.