3/20: First They Came For Our Bonuses...

March 20, 2009 12:45 PM by Ian Faerstein | Permalink |

Liberal bloggers were all over the map in their reactions to the passage of yesterday's House bill, which levied a retroactive 90% tax on bonuses for executives who (a.) work at companies holding at least $5B in federal bailout funds and (b.) earn at least $250,000/year. Some liberal bloggers praised the bill and warned that the six Dems who voted against it might face primary challenges. Other liberal bloggers criticized the bill, arguing that it punishes people who don't deserve to be punished. Still others complained that the bill doesn't go far enough.

While liberal bloggers were divided in their reactions to the bill, conservative bloggers were not. They unanimously blasted the bill, calling it "a cheap PR stunt to deflect public anger" and "blatantly unconstitutional". Conservative bloggers are also criticizing the 85 GOPers (which included Minority Whip Eric Cantor) who voted in favor of the bill.

What else is happening in the blogosphere?

Liberal bloggers (Kurtz, Bowers, Sirota) are accusing senior Obama adviser David Axelrod of being out of touch after he said that "people are not sitting around their kitchen tables thinking about AIG."
Liberal bloggers (Llorens, Greenwald, Bowers, Chris in Paris) continue to criticize Obama's economic team -- especially Treasury Sec. Tim Geithner. Others (Scheiber, Klein) are offering a qualified defense of Geithner's conduct with regard to the AIG bonuses.
Conservative bloggers (Hewitt, Malkin, Morrissey, Riehl) are blasting Obama for saying "it's like the Special Olympics" while joking about his poor bowling skills on Jay Leno's show.

Finally, please check back later today for our interview with Robert Stacy McCain!

AIG BONUS TAX: The Netroots Agree To Disagree

Liberal bloggers had a variety of reactions to the passage of yesterday's House bill. Several liberal bloggers praised the bill:

Open Left's Chris Bowers: "Good news: the Wall Street bailout bonus tax just passed the House. [...] This is going to start turning things around. This is the side we need to be on. Real action is being taken to recoup the bonuses, and Republicans were the ones opposed. Six Democrats voted against the bill. It will be interesting to see who they are. No matter what district they are from, their constituents are not going to like this."
BooMan: "I am kind of enjoying the return of 90% marginal tax rates. I don't think we should go quite that high in general, but something between 50% and 70% would be reasonable, depending on the loopholes. The fewer the loopholes, the lower the rate can be. There's not much point in paying out huge bonuses if the government gets to keep 70% of the money."

Other liberal bloggers criticized the bill:

TPM's Josh Marshall: "This strikes me as pretty ill-advised on a couple levels. First, what's to stop the companies from just folding the 'bonuses' into straight salary income? In which case, the whole thing goes out the window? Second, this cuts a pretty broad swathe. You don't want CEOs who drove their companies into the ground pulling down multi-million dollar bonuses from companies that wouldn't even exist any more without big taxpayer handouts. [...] But it's not clear to me why a couple, both of whom work in the financial services industry, and make $150,000 each should essentially have their entire bonuses taken back in taxes."
FiveThirtyEight's Nate Silver: "Just think about some of the implications of this. A senior engineer at General Motors, who shepherds the production of a new hybrid vehicle that will turn out to be a best-seller, shouldn't get a bonus for that. Really? Jamie Dimon at JP Morgan, who has managed his company's assets adeptly and kept it mostly off the taxpayer's dole, is no more deserving of a bonus than an AIG crook. Really? [...] I understand why the bill was written this way -- it had to be broad enough to fend off a constitutional challenge -- but the cure is worse than the disease. Much worse. I can't imagine a credible defense of it along economic lines, and so far as I've seen nobody has even attempted one."

Still others complained that the bill doesn't go far enough:

AMERICAblog's John Aravosis: "Are they freaking insane? Why does a company that got a $4.9bn bailout, or even a $2bn bailout, get to hand out $10m bonuses to their top employees? The Democrats don't think that little story is going to infuriate the American people? And why are you and me paying, in a year in which we're not even sure if we're gonna have a job, for anyone's bonus on Wall Street? Let alone someone making $249,000 a year? Who came up with that brilliant idea?"
Firedoglake's Jane Hamsher: "As John Aravosis writes, the measure to tax these bonuses is really half-assed and doesn't get to the heart of the problem -- namely, the deal cut by Timothy Geithner calls for AIG to cut $1 billion more in bonus checks to be paid for in July and September of this year."

AIG BONUS TAX II: This Is Just Wrong

While liberal bloggers were divided in their reaction to yesterday's House bill, conservative bloggers were not. They unanimously blasted the bill:

Power Line's John Hinderaker: "[Speaker Nancy] Pelosi's tax will never become law; it will die quietly at some point. Its only purpose is as a cheap PR stunt to deflect public anger -- mostly misplaced, in my view, to the extent that it focuses on the AIG bonuses rather than the multiple, trillion dollar disasters the Democrats have perpetrated or are planning."
Townhall's Matt Lewis: "Regardless of how one feels about the AIG fat-cats, we live under the rule of law. If the government cannot honor a contract, we truly have problems, but as it has been said, 'the power to tax is the power to destroy'."
Power Line's Scott Johnson: "A 90 percent income tax rate (even if not a marginal rate) harkens back to the good old days for liberals. [Speaker Nancy] Pelosi's proposed 90 percent income tax rate on the nefarious bonuses may well be a stalking horse for tax rates exceeding those to which Obama has already vowed to return."
Right Wing News' John Hawkins: "Targeting people's incomes with a special tax because the public is mad at them opens up a rather dangerous can of worms [...] If we're going to start playing this game, how about we aim a massive tax at former congressmen who lobby for a living -- after all, lobbyists are supposed to be bad guys, right? Oh, and how about a 90% tax on people who make over a million dollars per year acting? After all, no one deserves that kind of money just to act and those guys are jerks anyway. Know who else we should tax into the ground? Employees of organizations that engage in voter fraud -- I'm looking at you, ACORN. Is this a road we want to go down?"
Tom Maguire: "I deplore this confiscatory tax aimed at whoever Congress is mad at today. Right now it's AIG and Fannie Mae; later it will be Merrill and Citibank, and eventually it will be defense contractors, profiteering oil executives, or whomever the Congressional Dems single out as their whipping boy du jour."
NRO's Jonah Goldberg: "[W]e're a nation of laws. As Calvin Coolidge said, one with the law on his side is a majority. Those bonuses -- as bad as they might be -- are just one more toxic debt we took on when we decided to bailout AIG. In fact they're a tiny, tiny fraction of a fraction of debts we're taking on thanks to this mess and Obama's grand plans."

AIG BONUS TAX III: The Crazy 85

Conservative bloggers are also criticizing the 85 House GOPers who voted for the bill:

Lewis: "While I understand and appreciate the political realities -- and the tremendous populist outrage out there -- the notion that supposed pro-liberty fiscal conservatives such as Eric Cantor and [WI Rep.] Paul Ryan would vote for something so blatantly unconstitutional is frankly shocking."
Michelle Malkin: "You can find the full roll call vote on HR 1586, tax cheat [NY Rep.] Charlie Rangel's ass-covering, after-the-fact AIG bonus tax here. I have broken out the 85 Republicans (led by GOP Minority Whip Eric Cantor) who voted with Rangel and the Democrat demagogues. Because you should know. [...] Way to go, confiscatory Republicans. Charlie Rangel, [CT Sen.] Chris Dodd, and [MA Rep.] Barney 'Grabby Hands' Frank thank you!"
Hinderaker: "[The] wall of shame [is] where we put the names of House members who voted for Nancy Pelosi's silly, unconstitutional 90% tax on the AIG bonuses. The measure passed, 328-93, with Democrats frantically seeking cover against voter wrath. It's sad to see any Republicans going along with the Democrats' Know-Nothingism, but, by a bare 87-85 margin Republicans opposed the Dems' stunt. I'm glad to see that conservative stalwarts, including [MN Rep.] John Kline, [AZ Rep.] John Shadegg and [MN Rep.] Michele Bachmann, generally voted 'no.'"

AXELROD: Out Of Touch?

Liberal bloggers are accusing Axelrod of being out of touch after he downplayed the significance of the AIG bonus scandal, saying, "People are not sitting around their kitchen tables thinking about AIG. They are thinking about their own jobs":

Open Left's Mike Lux: "I love and admire David Axelrod, but he is just plain wrong if he really believes that 'people are not sitting around their kitchen tables thinking about AIG'. Um, yes they are. And they are pissed out of their minds."
TPM's David Kurtz: "I honestly don't get what up-side they see politically in taking this tack."
TalkLeft's Big Tent Democrat: "The Obama political team seems to be out of whack these days. [...] Axelrod [is] reveal[ing] some real political tone deafness."
Bowers: "Wow. That is a lot of cognitive dissonance, given that President Obama himself said that people were 'right to be angry, I'm angry,' over the bonuses. Are people angry, or don't they care? Depends on if you are listening to President Obama or to his senior advisors, I guess. [...] Americans are pissed about the bonuses because they are pissed about the recession. Because they are pissed at Wall Street. Because they are pissed a a bailout they were told was necessary, but that only seems to helping make the rich get richer. If that isn't obvious to you, it should be. Democrats and progressives are screwed if we don't catch this populist wave."
Open Left's David Sirota: "Look, I get that nobody in Establishment Washington genuinely cares that taxpayers are being ripped off, and I get that the super-wealthy political class from millionaire investment banker [Rahm] Emanuel to millionaire consultant Axelrod to millionaire banker Tim Geithner gives much of a shit that our taxpayer dollars are being used to make new millionaires on Wall Street. But their boss, President Obama, is right: A huge majority of Americans, most of whom are not millionaires, are really angry and has a right to be angry. [...] If the White House doesn't get out of the tone deaf D.C. echo chamber and get back on message, my bet is that very soon Republicans' faux populism that portrays Democrats as part of the problem is going to start getting traction."
Salon's Glenn Greenwald: "You can't spend six months frightening people by warning them that they're headed into a Great Depression and then be surprised when they're 'outraged' that hundreds of millions of dollars in taxpayer money are being shoveled into the pockets of those who helped bring the situation about."

GEITHNER: The Pile-On Continues

Liberal bloggers are harshly criticizing Obama's economic team -- especially Geithner:

Atrios: "The issue is that [Geithner] and friends never distinguished between bailing out the system and bailing out the players. There was a way to do that, and they didn't do it."
Big Tent Democrat: "Geithner and [WH economics adviser Lawrence] Summers are busy trying to save Wall Street, not the country's economy. Therein lies the problem."
Greenwald: "It's hard to know which is worse: that Geithner was aware of [AIG's retention bonuses] and now claims he wasn't, or if, while at the New York Fed working on AIG's bailout, he somehow remained blissfully unaware of all of this. Given the relative amounts involved, the bonus payments themselves may not be significant in the scheme of things, but the window this scandal provides into the insider dealing, arrogance and corruption driving the trillions of dollars in public money flying around (and disappearing) certainly is significant."
AMERICAblog's Chris in Paris: "[Geithner] is not the person we need for these extraordinary times. We need someone who is much more aggressive about fighting these companies and restoring balance to a distorted and dysfunctional system. Geithner is not that person."
Bowers: "I also agree with President Obama that these bonuses are a symptom of a larger problem. That includes Timothy Geithner's Wall Street bailout plan, as Geithner originally worked against anti-bonus legislation in order to protect that bailout plan. Geithner has, in fact, been doing this all along. We need a different plan, one that, in order to work, doesn't require making the people who ruined the economy even richer."

Lux: "I know you don't like us bloggers who over-simplify things, Mr. President, but this is gut-check time: you have to decide which side you are on. Many of my friends are calling for Tim Geithner's head, but I don't think that is what this is about. You as President need to decide which way you are going to go. One path keeps dribbling out more and more money to big bankers while letting them operate according to their version of "free market principles," such as giving multi-million dollar bonuses to retain employees. The other path says you save our banking system by taking it over, firing the executives who have put us in this mess, and putting people in charge with the public interest in mind rather than their own. The problem with trying to walk down both paths at once - giving out billions more to save the banks while letting them run things the way they are and at the same time expressing justifiable outrage when they screw up - is that it is politically untenable."

GEITHNER II: Get Some Perspective, People

Other liberal bloggers are offering a qualified defense of Geithner. They're arguing that the $165M AIG bonuses -- while outrageous -- aren't all that important in the grand scheme of things:

The New Republic's Noam Scheiber: "I have to say, I'm starting to find the obsessive 'what did Geithner/Obama know and when did he know it' line of questioning a little tedious. [...] I mean, however you feel about what Geithner knew about the bonuses and when he knew it, you have to concede that his far bigger concern throughout this time was preventing the global economy from self-immolating. As a substantive proposition, how much would we even want a Treasury secretary to focus on $165 million in bonus money while there were hundreds of billions of dollars in bailout money flowing to AIG and other companies? Doesn't seem like that would be a particularly good use of his time beyond a certain point."
Ezra Klein: "[G]iven the information Geithner had available, it's hard to argue that he should have stopped the bonuses. The AIG retention payments were one-tenth of one percent of the money we've given AIG, much less the rest of the system. Whether Geithner knew of them early or late, he probably didn't consider them a priority. If someone had sat him down and explained that the bonuses would become the flashpoint for populist outrage and imperil the whole of the administration's response to the financial crisis, that might have changed matters. But that sort of thing is hard to predict that in advance: There have almost certainly been a thousand outrageous provisions and outcomes on the level of the AIG bonuses. If Geithner were of a preventive mindset, he could expend so much effort putting out potential political brushfires that he'd have no time to actually deal with the inferno consuming the banking system."
Think Progress' Matthew Yglesias: "The AIG bonuses are largely irrelevant to the recovery issue, and while important as a social justice matter they're primarily of symbolic social justice importance. It's good that people are outraged by this -- it's outrageous! And it's good that in response to the outrage the government is now working to correct the problem. That's the media-political-outrage cycle at its best. But it's not healthy to just go 'round and 'round in circles over this issue endlessly. If 18 months from now the economy's still shrinking and unemployment's at 15 percent, nobody's going to feel particularly happy about the fact that we stuck it to some scumbags from AIG back in early '09."

OBAMA: We're Not Laughing, Mr. President

Conservative bloggers are blasting Obama for saying "it's like the Special Olympics" while joking about his poor bowling skills on Leno's show (Obama later apologized):

Little Green Footballs' Charles Johnson: "Obama insults disabled people. Unbelievable."
Townhall's Hugh Hewitt: "There is an effort underway among the eugenics-minded to encourage the abortion of children identified as having Down Syndrome. Casual cruelty of the sort President Obama engaged in is, sadly, routine, and reinforces the popular idea of children with Down as somehow second-class."
RedState's E Pluribus Unum: "Obama insult[ed] the dignity of special-needs Americans. [...] It wasn't a slip of the tongue. It was inconsiderate, rude, and insulting. That little gift-exchange fiasco with [British PM] Gordon Brown along with this, reveals a vain, self-important, small man."
Hot Air's Ed Morrissey: "Maybe he should have brought his Teleprompter with him. [...] Eventually, even the media will have to realize that Obama is in over his head. They may be the last ones in on the joke, but eventually they'll catch onto the fact that Obama is floundering."
Dan Riehl: "Obama [is a] clueless, classless clown. Come on, folks. Let's face the facts. The idiot sent some errand boy out to WalMart for a gift for the British PM -- read the wrong teleprompter lines when with the Irish PM -- and now this. [...] He's making Jimmy Carter look good by comparison. Unfortunately we have to wait four years to cough up this electoral fur ball who can't even make his mind up about a dog. Thank you mainstream media. You should be proud -- electing this idiot was a wonderful dying act."
Michelle Malkin: "Way to go, Soul Fixer. I blame Obama's Prompter...or lack thereof."
NRO's Yuval Levin: "How do you top trying to make injured veterans pay for treating their own war wounds? Maybe by making fun of disabled athletes. [...] What's next, tripping elderly nuns? He's very lucky he's not a Republican."

Hot Air's Allahpundit was one of the few conservative bloggers who defended Obama: "[H]onestly, I tire of this politically calculated outrage. We all know what he meant; it was politically incorrect, but more political incorrectness among our political elite is all to the good. Lay off."

THOUGHT OF THE DAY: Obama's Challenge

Josh Marshall analyzes the significance of the AIG bonus scandal:

"What is so damaging about this isn't the money -- which is almost trivially small compared to the many hundreds of billions we've already committed. The problem is what appears to be the president's mortifying impotence in the face of bankers and financiers who created the problem. The president speaks and acts for the federal government, which is to say, the American people, who have mobilized more than a trillion dollars and all powers of the state to repair the damage emerging out of the financial sector. And with all that, he's jacked up on a employment agreement between a company the government now owns and derivatives traders who sank the world economy and may quite likely be looking at criminal charges for their activities in the not too distant future? Anyone can look at that and see that the equation of power and accountability is all screwed up. [...]

Whether Geithner and Summers are too close to the people on Wall Street, either through interest or affinity, is an interesting and possibly important question. But fundamentally Obama needs to start showing that he's in charge, that he's operating as the American people's advocate and that he has the power to do it -- which these stories of getting jacked up by some Gordon Gecko wannabes in London just terribly undermines. But to do that, to show that, it has to be true. And that might require some real changes in policy and possibly in personnel too."

LEST WE FORGET: Dick Vitale More Sexual During March Madness, Wife Lorraine Reports

From The Onion:

"BRISTOL, CT -- Emerging from her husband's dressing room slightly out of breath and sporting nothing more than a silk robe and tousled hair, Lorraine Vitale, wife of iconic ESPN college basketball analyst Dick Vitale, told reporters Sunday that her spouse is at his sexual peak during March Madness.

'He's an animal,' said Mrs. Vitale, adding that prior to her husband's appearance on ESPN's Selection Sunday special, the couple engaged in sexual intercourse three times in different locations, including once in a Bank of America ATM kiosk. 'We fool around at other times during the year, of course, but once the conference tournaments start and the brackets are finalized, well, that's when the role-playing starts, the dirty talk gets louder, and "the prime-time player" comes out of its velvet-lined case and gets fresh batteries.'

'He's especially aggressive this year because Duke has a legitimate chance at making the Final Four,' she added."