The law passed this week by the Congress to tax bonuses paid to employees of banks that took Government money is unconstitutional populism.
- It is unconstitutional because Article One, Section 9, paragraph 3 of the Constitution states “No Bill of Attainder or ex post facto Law shall be passed.”
- It is populism because the Federal Government has already paid AIG and its fellow capitalist a thousand times more money than is involved in the bonuses. A trillion dollars has already been paid to these companies because of bad bets they made on the housing market and the risk it involved. It was paid without a debate in Congress about the system, the moral hazard or the final recipients of the money. Trying to take this little bit back is populist grandstanding to draw attention away from the governing elites other failures that contributed to this collapse.
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The Guillotine is also unconstitutional. But if we’re gonna cross that line anyways, why not go all the way?
Oh, and just to show that my ridiculously overpriced legal education does occasionally come in handy:
1) the Ex post facto clause only applies to criminal prosecutions, and
2) the Bills of Attainder clause typically prohibits laws that only apply to a specific list of people. For example, you couldn’t pass a law applying a tax to Barack, Joe, Timothy, Larry, and Sheila. However, you could pass a law applying a tax to executive branch compensation over $350K. Same effect, more or less, but black and white in terms of constitutionality.
Andrew
I was focused on the “ex post facto” since I didn’t know the meaning of attainder. Now I do.
Has the Supreme court ruled that ex post facto only applies to criminal cases? And if I don’t pay my taxes isn’t that a criminal act?
Simon
The first case to squarely address the point was Calder v Bull, a case from 1798.
It’s a crime to not pay your taxes. If one believes a tax is unconstitutional, the proper procedure is to pay the tax, then sue the gov’t in federal district court for your money back. If you win, you even get interest on the money you paid.