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AIG Bonuses now just a distraction?

The Congress recently voted to tax the AIG bonuses at 90 percent, effectively eliminating them.  Republicans had a plan to tax the bonuses at 100 percent but after state and local taxes take their slice of the bonuses, the Democratic 90 percent plan effective taxes the bonuses at 100 percent once all is said and done.  The media is still harping on the issue of why the bonuses were allowed to exist in the first place and I think that is a distraction now from larger issues that the country is about to tackle - the issues of health care and employee free choice.  Likely these two issues will have to take a back seat while the shouting continues in Washington and in the media.  Those in Washington that oppose a single payer health care system or oppose making it easier for employees to unionize will likely continue the attack on AIG and on the Treasury Department for not eliminating the bonuses earlier on.  The media loves it at the moment, you can watch the joy in the faces of the newscasters and commentators as they discuss AIG and the outrage about the bonuses because they have an easy issue to talk about that almost no one will disagree with.  It brings ratings due to the amount of anger in the public about AIG and that means the stories will continue.  Politicians are helping to further the story by giving the media the type of red meat quotes that makes them salivate - things such as having the AIG management come before a committee and either resigning or killing themselves.  I would be surprised if the story doesn’t continue for the next two weeks, and that is unfortunate because the country still has much larger issues than millions of dollars in bonuses.

One Comment

The AIG bonuses are really distasteful, but totally legal. The real problem is how Congress’ reaction to it will effect other politically targeted groups like real estate investors.

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