[StBernard] Word from Washington: Rep. Melancon Votes to Recover Taxpayer Dollars Used for Corporate Bonuses

[Westley Annis]

Dear Westley,

Thanks for subscribing to my e-newsletter.  I wanted to let you know about
an important piece of legislation we voted on in the House today. The Bonus
Recoupment Tax Bill, H.R. 1586, would recover taxpayers' dollars from AIG
and other companies that have rewarded employees with excessive bonuses
while simultaneously accepting billions in taxpayer assistance. 

The Bonus Recoupment Tax Bill would impose a new 90 percent income tax on
bonuses received by individuals from companies which have received over $5
billion from the Troubled Asset Relief Program (TARP). It would also apply
to bonuses paid by Fannie Mae and Freddie Mac.  The tax only would apply to
bonuses received by employees with adjusted gross income over $250,000.

After receiving more than $170 billion in taxpayer funds, AIG paid $165
million in retention payments to executives - most of whom have mismanaged
their company into near bankruptcy.  The top recipient received more than
$6.4 million and more than 73 of these executives were paid over $1 million
in retention bonuses.  After receiving their retention bonuses, at least
eleven recipients left the company.

Louisianians are justifiably outraged that Wall Street thinks they can pay
out bonuses to their employees at taxpayer expense. Our tax dollars should
not and will not be used to reward AIG executives whose irresponsible
risk-taking brought our financial system to the brink of collapse.

Over the past few months, I have supported several bills in Congress to
bring accountability to the TARP and prevent further abuses of taxpayer
dollars.  In January, I voted for the TARP Reform and Accountability Act,
which would have prohibited bonuses for top executives at companies
accepting taxpayer funds and banned multi-million dollar "golden
parachutes."  H.R. 384 passed the House on January 21, but the Senate has
not yet acted on the bill.

I also supported provisions in the American Recovery and Reinvestment Act
(also known as the "stimulus") that would also have curbed multi-million
dollar pay packages on Wall Street by imposing new limits on executive
compensation at financial institutions and other corporations that have
received or will receive funds through the TARP. In addition to these
limits, the recovery package also included a provision requiring the
Treasury to review past compensation paid to the top 25 employees of TARP
recipients and seek to negotiate for reimbursements if those payments were
"contrary to the public interest or inconsistent with the purposes of the
Act or the TARP."  H.R. 1 was signed into law by the President on February
17.

The bill that passed the House today will hold accountable companies that
accepted TARP money, and I strongly support it.  If AIG won't act
responsibly and return the bonuses, we will use every tool available to make
them repay the American public.

As your representative in Congress, I am proud to be working on behalf of
the people of south Louisiana and see great things in our future. As always,
I would like to hear from you so please feel free to write, email or call my
offices and share your opinion on the many issues we are considering in
Congress.
 
Regards,
Charlie Melancon