The plan to fix everything

Since everyone is angry at AIG for paying out bonuses to it's worst division, the financial products division which tanked the entire company, I figured there had to at least be one lawmaker who had a plan to cap the bonuses and got shot down. TUrns out Ron Wyden (D-OR) said not only did he have a plan to stop the AIG bonus mess, that it passed before it was taken out of the bill in conference committee. Right now blogs and the HuffPo are trumpeting this as some sort of smoking gun of governmental incompetence/malfeasance THAT COULD HAVE SAVED EVERYTHING! What was his plan?

Senator Ron Wyden said on Tuesday that the furor surrounding AIG's bonus payments could have been avoided had the Obama White House and members of Congress simply backed legislation that he and Sen. Olympia Snowe introduced more than a month ago.

In an interview with the Huffington Post, the Oregon Democrat noted that during the crafting of the stimulus package, he and his Republican colleague from Maine introduced a provision that would have forced bailout recipients to cap their bonuses at $100,000. Any amount paid above that would have been taxed at 35 percent. The language made it through the Senate, but during conference committee with the House, it was inexplicably removed.

"The reality is, had that legislation been passed it would have been a very strong disincentive to anybody paying out bonuses in the future," said Wyden.

Seriously? Your plan was to cap bonuses at $100,000? Well, $100k......unless companies wanted to pay more than that (which they would) then there would be a regressive tax~! The regressive tax is.......a tax rate that is almost exactly the same as the regular tax rate they'd pay on the money. Oooooh burn! Paying the top tax rate totally would have stopped everything, Ron.

He's learned from this harsh experience, he and Olympia are introducing an even harsher bill. All the same provisions as the previous bill, except the fake cap is set at $50,000. Surely it will stop someone from taking a million dollar bonus. Here's a crazy suggestion: class war select a bailout bonus level you're comfortable with and then tax everything over that.....100%. That would actually stop it.

EDIT: Slightly better news. Max Baucus and Chuck "Let 'em commit suicide" Grassley have a bill that caps it at $50,000 and then levies a 35% excise tax on anything over. Which, when factored in with other federal, state, and various taxes essentially means 100%. Throw a party.