I was mad as hell over the past few days, reading the papers about members of the financial products division at AIG (NYSE: AIG ) receiving seven-figure retention bonuses for a job not-so-well done.
These bonuses were just another slap in the face for an already well-battered population of American taxpayers, who are investors in all the bailed out financial companies like Citigroup (NYSE: C ) , Bank of America (NYSE: BAC ) , Fannie Mae (NYSE: FNM ) , and Freddie Mac (NYSE: FRE ) .
And though legally entitled to these awards, I saw no reason why any person of decency and honor should feel himself ethically entitled to them.
The fruits of their labor
In that fit of rage, my first thought was to call for the names of every individual who accepted these bonuses to be published in every newspaper across the country.
I longed for good, old-fashioned public shame and peer pressure -- nothing more, nothing less.
Fortunately, it seems the media has worked faster than I could ever dream. Respectable members of the insurance giant have already begun to return these payments, realizing that these monies were nothing more than the unearned skins off their neighbors' backs.
Caution: Media at work
To the individuals who have returned the money, I award you no commendation. This was simply the right thing to do.
To the bankers that have yet to do so, I call on you to do the right thing: Refuse these monies, or return what you have accepted in full.
I would hope that the embarrassment of keeping this money would be far more expensive than the sum of whatever you would hope to gain from it.
But there is something far more nefarious brewing out of this mess. And it's happening at the Capitol.
To Chuck Rangel and other members of Congress
As we speak, you (Congress) are making efforts to manufacture highly specialized taxes to effectively void contracts that were made in good faith. That is what is terrifying to me.
I caution our government: Do not attempt to break these contracts or render them useless through retroactive legislation and taxation.
What a slippery slope you place us upon with these types of actions. When a government decides that something isn't fair (determined entirely by its unfortunate outcome), it should attempt to compensate for it by drafting retroactive legislation?
The legal community has a name for that, you know. These laws are called ex post facto ("after the fact"), and they are expressly prohibited by Article 1, Section 9 of United States Constitution: No bill of attainder or ex post facto Law shall be passed.
I'm not a lawyer. And I'm sure that a crafty politician (or a reasonably competent lawyer) could run circles around this argument of mine. But surely our founding fathers would be against enacting special, targeted taxes (aimed at an astoundingly small number of private citizens) purely to affect the outcome of contracts that were bargained upon in good faith and meeting all standards of legality at the time of agreement.
And yet that is precisely what you are trying to achieve here.
To the president
Mr. Obama, perhaps you haven't explicitly instructed your party members to draft such legislation, but when you order Treasury Secretary Geithner to use every legal means necessary to recover these bonuses, it's not hard to imagine some enterprising congressman inferring that message as, "If it's not already legal, make it legal."
That's a problem.
We are a nation of laws
Are we willing to abrogate the good rule of law simply to punish a few, select individuals? I sure hope not.
Perhaps, today, punishing these individuals may seem like the "fair" thing to do, and surely the mob is calling for it. But once you set these wheels in motion, they'll surely be difficult to stop.
Once we give our government the power to retroactively dictate what is and what isn't fair based on the outcome of events, we've given it tremendously dangerous jurisdiction.
What would happen, dare I say, if the government were to decide to take advantage of these powers when it isn't fair or decent?
History repeats itself
I'm reminded of Patrick Henry who said, "The Constitution is not an instrument for the government to restrain the people, it is an instrument for the people to restrain the government -- lest it come to dominate our lives and interests."
So, I say shame the bankers at AIG who refuse to return money that is legally theirs, but not rightfully theirs. But I seriously advise our government not to attempt to redefine its own role, for I suspect we'll long regret it.