Sunday, March 22, 2009

AIG...again?

It seems like President Obama doesn't agree with Larry Tribe's analysis. Although the House has already passed a bill directed at recouping the AIG taxes, the AP reports that the Obama administration has some reservations:
The White House said Sunday that using tax law to pry bonuses from bailed-out company executives is "a dangerous way to go" and a Republican senator advised against Congress "grabbing its pitchforks and charging up the hill" in pursuit of the cash.
The article goes on to explain that the concern is constitutional in nature. As Vice President Obama's economic adviser, Jared Bernstein, told the AP:
I think the president would be concerned that this bill may have some problems in going too far — the House bill may go too far in terms of some — some legal issues, constitutional validity, using the tax code to surgically punish a small group . . . [t]hat may be a dangerous way to go.
A lot of this back-and-forth may be mere (political) posturing, but it's interesting to hear these concerns--again--where the tax passed extended beyond AIG itself. Indeed, as TaxProf Blog noted, legal scholars weighing on the issue have suggested that the law would not face any constitutional infirmities. As usual, we'll continue to follow this soap opera.

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