Senators Jim Webb (D-VA) and Barbara Boxer (D-CA) introduced the Taxpayer Fairness Act, legislation that would recoup excessive bonuses paid by Wall Street banks and other firms that benefited from billions of taxpayer dollars in 2009.


THE WEBB-BOXER "TAXPAYER FAIRNESS ACT"

Bill will Recoup Wall Street Bonuses Paid with Taxpayer Dollars


In February 2009, Senators Jim Webb (D-VA) and Barbara Boxer (D-CA) introduced the Taxpayer Fairness Act, legislation that would recoup excessive bonuses paid by Wall Street banks and other firms that benefited from billions of taxpayer dollars in 2009. The revenues generated would be used for deficit reduction.

The bill would impose a 50 percent excise tax on the bonuses of employees at these firms that exceeded $400,000 in 2009. Any employee who received a bonus larger than $400,000 – the salary of the President of the United States – would have to pay a 50 percent tax on the portion of the bonus over $400,000. The legislation would apply only to Wall Street institutions that received more than $5 billion from the Troubled Asset Relief Program (TARP).

“We believe this is a fair and reasonable approach. It offers equity and a level of fairness to the American taxpayers who bailed these companies out,” said Senator Webb. “This is not class warfare. This is not something that’s going to run the gamut of all executive compensation and bonuses. This is a one shot deal. This is a tax on excessive bonuses of TARP recipients that received more than 5 billion dollars from the American taxpayer in 2009.”

“In September 2008, Secretary Paulson and Chairman Bernanke told the Congress that, without a $700 billion investment into the TARP program to assist our major financial institutions, our world was going to go into cataclysmic economic freefall, Webb continued. “Many of us supported that program with the understanding that, if the American taxpayers were putting $700 billion into the system in order to rescue these financial institutions, the American taxpayers would be able to get a return on their investment as well.”

In 2008 and 2009, the financial sector received unprecedented aid from taxpayers. In addition to the $700 billion TARP, there were 50 separate Federal programs offering $23 trillion in loans, grants, or asset guarantees to the financial sector, according to the nonpartisan Special Inspector General for the TARP (SIGTARP.)


MATERIALS & RESOURCES:

NEWS ARTICLES:

Huffington Post, “Another Wall Street Bonus Tax Falters in Congress,” March 9, 2010
The Hill, “Boxer, Webb Target Wall Street Bonuses,” February 5, 2010
Dow Jones Newswire: “US Sens Boxer, Webb Seek Tax On TARP Recipient Bonuses,” February 5, 2010
Huffington Post, “Webb Wants Banker Tax As Amendment To Jobs Bill,” February 12, 2010