Your addition of new details into the analogy are unnecessary and not analogous. Let’s work with the assumption of the article that taking back the money is punishment. If that’s punishment, then what would be jailing the AIG execs: a death sentence, murder? Since we’re upgrading the effects of all laws by some paranoid standard, we can see that calling it “punishment” is dishonest hyperbole.

Also, just to give a thorough debunking of your retort, let’s say we did add in your additions to the analogy. Let’s say that bag I picked up is worth $100 and it’s the companies bag. Let’s also add in that I now own 80% of the company, I’ve given the company $10,000 to bailout the failing company, and I also have legal power to seize any bags that are on the premises. So, like AIG, the other party has no right at all to the bag.

* We own AIG
* The Constitution gives the power to tax the bonuses at 90%
* The bastards don’t deserve the bonuses anyway

Obviously it would have been superior if this were all handled perfectly with flawless foresight. Never hold your breath waiting for that, folks. The way I look at it is that AIG would have collapsed without gov’t intervention, in which case the bonuses would not have been paid or would have been subject to re-negotiation in bankruptcy court. So if they end up getting rescinded via a baroque keystone cops process, rescinded is IMO still better than let to stand.

And it boggles the mind to think that the particular way in which the gov’t bailed out the company ought to matter much. Again, unless you worship process. Which lawyers do, BTW.

I am sympathetic to those who wish to protect the relative sanctity of the contract. But the fact is that in the real world the enforceability of contracts is already somewhat fungible, subject to various variables including lots of forms of power and coercion that exist well outside the bounds of signed papers.

So if current congressional actions in fact set a potentially dangerous precedent, I am not all that perturbed if we must therefore limp along without a slightly more diminished sanctity for contracts. We’ll live.

Folks who want to protect contract sanctity and are arguing against these actions seems to suggest that it will lead right down a slippery slope to a world where the terms of legal contracts will become practically optional.

That feels like rank hyperbole to me, Again, we’ll keep limping.

Rich, suppose for the sake of argument we grant that its punishment. Then we can move on to whether or not such punishment is deserved, right?

Ultimately if these folks are denied these bonuses, it’ll be because the recipients were judged morally undeserving. This does not seem to me to be all that terrible an outcome, the questionable moral character of the gov’t bumbling actions notwithstanding.

Further, I wonder what unstated constraints exist upon the folks who are being denied these bonuses should they decide to contest this outcome. First, they’ll get the public cavity search, where everyone gets to see how richly they profited while constructing complex and unstable investment vehicles that helped collapse the economy. Then, while plaintiffs are dragging this through the courts, enterprising government lawyers get to pore over all the possible angles for finding criminal actions on the part of these folks, probably along the lines of fraud and negligence.

If I were one of the folks who got the really big bonuses, I would be RUNNING to give it back. WAY better to let my combative and unrepentant buddy who insists on his right to the bonus be the public fall guy that goes in the history books in an orange jumpsuit.

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What’s stupid is not giving over the bonuses, as well as calling the re-taking of those bonuses “punishment.”

If I am at an airport and I pick up a bag that doesn’t belong to me, and people make me give it back: is that punishment?

Use common sense, dude.

If I am at an airport and I pick up a bag that belongs to me, and people make me give it back: is that punishment?

Use common sense, dude.

Still, I’m not sure the law is unconstitutional, for reasons cited Doug.

Heres the right one:

http://tinyurl.com/d89m7v

I agree that this is a horrible precedent to set, and that Congress is really just diverting our attention from what’s really important here, but as far as the Constitutional arguments go, I’m afraid that it isn’t quite so cut and dry:

http://tinyurl.com/d23sft