Senate Republicans to make Dems Twist in Wind Over AIG

Look I have nothing against bonuses, I have a lot against the convergence of AIG the Democrats and their criminal behavior. I say let them twist.

WASHINGTON – Senate Republicans are drawing out a flap that has made the Obama administration squirm, applying the brakes to Democratic attempts to quickly tax away most of the bonuses at troubled insurance giant AIG and other bailed-out companies.

Sen. Jon Kyl, the Republicans' vote counter, blocked Democratic efforts Thursday evening to bring up the Senate version of the tax bill to recoup most of the $165 million paid out by AIG last weekend and other bonuses in 2009. The House had swiftly approved its version of the bill earlier in the day.

By rushing, Kyl said, Democrats were letting populist outrage trump informed decision making in the Senate, which is supposed to be insulated from the pressures of public passion.

The obvious, people knew:

(CNN) — President Obama said he was “stunned” to learn that $165,000,000 in so called “retention payments” were going to AIG executives blamed for the company’s collapse. Treasury Secretary Tim Geithner told CNN’s Ali Velshi he was “informed by my staff of the full scale of these specific things on Tuesday, March 10th.”

Geithner added “as soon as I heard about the full scale of these things we moved very actively and explored every possible avenue, legal avenue, to address this problem.”That makes it sound as if the retention payments were a big nasty surprise. Really?

In fact the payments were hardly a big secret.

Why the bonus tax is a bad idea:

(CNN) -- The Senate is taking up a controversial bill that would impose a hefty tax on bonuses paid out by companies propped up by taxpayer money But, as outrageous as the bonuses may seem, critics of the bill say the tax code should never be used as punishment.

Lawmakers cried foul after it was revealed earlier this week that ailing insurance giant American International Group doled out $165 million in retention bonuses, after claiming more than $170 billion in bailout funds.

Taxes are for revenue not punishment, that is a no brainier. More opposition from the White House:

WASHINGTON (CNN) – President Obama's economic advisers on Sunday refused to endorse a House bill that would levy a 90 percent tax on bonuses paid out by companies that receive bailout money, with one administration official describing the plan as potentially "dangerous."

Fueled by anger over more than $165 million in bonuses paid out by insurance giant AIG, the House passed the punitive tax bill on Thursday in a 328 to 93 vote

Jared Bernstein, Vice President Joe Biden's top economic adviser, told ABC's "This Week" that the bill "may go too far in terms of some legal issues, constitutional validity, using the tax code to surgically punish a small group. That may be a dangerous way to go."