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Posted By Russ Roberts On March 17, 2009 @ 12:20 pm In Financial Markets,Politics | Comments Disabled
Senator Chris Dodd (D-Conn.) on Monday night floated the idea of taxing American International Group (AIG : 0.9468, 0.1667, 21.37%) bonus recipients
so the government could recoup the $450 million the company is paying to employees in its financial products unit. Within
hours, the idea spread to both houses of Congress, with lawmakers proposing an AIG bonus tax.
the Senate constructed the $787 billion stimulus last month, Dodd
unexpectedly added an executive-compensation restriction to the bill.
That amendment provides an “exception for contractually obligated
bonuses agreed on before Feb. 11, 2009,” which exempts the very AIG
bonuses Dodd and others are seeking to tax. The amendment is in the
final version and is law.
Also, Sen. Dodd was AIG’s largest
single recipient of campaign donations during the 2008 election cycle with $103,100, according to opensecrets.org.
Dodd’s office did not immediately return a request for comment.
One of AIG Financial Products’ largest offices is
based in Connecticut.
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