What’s happening with the AIG bonus scandal?
Congressional action to recoup the $165 million in bonuses already handed out to AIG employees has been derailed. On March 19, the House responded to public outrage by voting 328-93 to approve a bill that would impose a 90% tax on any bonuses given to employees at AIG and other firms that received more than $5 billion in bailout money. However, when the White House expressed concerns about the bonus tax, the Senate punted the issue until after the April recess. Sensing the loss of momentum behind bonus taxes, the House voted on April 1 to approve a substantially weaker approach. The new bill, which passed by a 247-171 margin, would place some limits on future bonuses, but would otherwise allow Treasury Secretary Timothy Geithner to determine whether employee compensation at the bailed-out firms was “unreasonable” or “excessive.
