The prevailing academic view seems to be that courts are unlikely to invalidate a confiscatory tax on bonuses received by executives at AIG and other TARP recipient companies. Paul Sracic at Youngstown State takes a different view.
Congress may have more of a problem with the Bill of Attainder provision than they are admitting. This is because the separation of powers principle that might normally argue for judicial deference may run in the other direction here.
Chief Justice Earl Warren wrote in US. v. Brown (1965) that the basic reason for a Bill of Attainder clause was to prevent "trial by legislature." This is because "the legislative branch is not so well suited as politically independent judges and juries to the task of ruling upon the blameworthiness of, and levying appropriate punishment upon specific persons. "
Congress can always levy a tax that seems punitive to those who have to shell out the money. Legislative motive is therefore crucial to both limiting and to giving teeth to Bill of Attainder analysis. Does anyone think that it would be difficult to prove in court that the overwhelming reason that this bill was passed was to confiscate the ill-gotten gains of those AIG employees who received the bonuses? It is money that is already in their pockets. In this sense then, confiscation of property is being used as a punishment. When Congress does this, it is a Bill of Attainder.
I am sympathetic to this view, but I still think courts will be reluctant to invalidate the tax. It may be generally understood that the tax is motivated by public outrage against the issuance of these bonuses, but it could still be "difficult to prove in court that the overwhelming reason that this bill was passed was to confiscate the ill-gotten gains of those AIG employees." Courts are rightfully reluctant to evaluate legislation on the basis of stray comments made by legislators, particularly if different legislators express different opinions. Key members of Congress have already begun to distance themselves from arguments that the tax is a punitive measure. Rep. Charles Rangel, for instance, argued on Fox News Sunday this morning that the tax is really about protecting taxpayers, and not about punishing AIG execs. Whether we believe him or not, such comments will make it difficult to prove that Congress acted with an illegitimate motive, particularly given the broad deference courts have shown Congress in this area. So while I am sympathetic to the view that the tax is, in fact, an unconstitutional Bill of Attainder, I remain skeptical that the federal courts would so hold.
Related Posts (on one page):
- Epstein on AIG Bonus Tax:
- Is the AIG Bonus Tax Really a "Tax"?
- More on AIG Bonus Tax as Bill of Attainder:
- Tribe on Taxing AIG Bonuses:
- "Would a Super-Tax on AIG Bonuses Be an Unconstitutional Bill of Attainder?"