For those who couldn't make Tibor Machan's CMC '65 Athenaeum talk, here it is. I apologize to the shaky video and the audio. I recommend turning it up.
Monday, March 30, 2009
I've been wondering a lot about whether or not TARP or the bills that were passed to punish AIG are constitutional. I admit that that might seem a worthless question in a world that deifies its president, but I'm asking it nonetheless.
His Friday broadcast spotlighted the American International Group Inc. executive bonus debacle that lawmakers are lashing out over in Washington D.C. His guest: Ralph Rossum, American constitution professor and director of the Rose Institute of state and local government at Claremont McKenna College.
Rossum shed light on what "ex post facto law," or retroactive law, entails and went into detail about how the constitutional powers of Congress to tax workers for the "general welfare of the United States" relates to AIG executives.
For those who are looking for more, please see George Will's piece, "Bailing Out of the Constitution."
In another segment, Professor Rossum continued to talk about the contracts clause, bills of attainder, and the U.S. Constitution applied to AIG. He gave a rundown of all of the things that AIG was involved in.
What is a bill of attainder? Article I, Section 9 is a limit on Congress, an ex post facto law is one that is passed after the fact. But here's the problem, an ex post facto law only applies to criminal law, not civil law. In the past, Congress has raised income tax rates retroactively to the beginning of the year and so, the bonuses tax is probably not an ex post facto law.
A bill of attainder punishes identifiable individuals for particular punishments of one sort of another. Seeing as the bill is going to hit people at Bank of America, CitiBank, GM, and others and that it wasn't expressly targeted at AIG people, it may not be a violation of a bill of attainder either.
Can congress tax AIG to "pay for the general welfare"? The Courts have ruled in Butler v. United States that Congress can tax whenever it thinks its in the general welfare. The Court will "play dead" on this issue, Rossum predicts.
Rossum says that there is no way to stop this punitive tax from going through. The hope is that in the Senate some sanity might prevail or that Obama might veto it. So, no, this measure is going to be sticking around, says Professor Rossum. Well, there's a chilling thought.