WASHINGTON (AP) — The Democratic-led House overwhelmingly approved a bill on Thursday to slap punishing taxes on big employee bonuses from AIG and other firms bailed out by taxpayers. The vote was 328-93. “We want our money back and we want our money back now for the taxpayers,” said House Speaker Nancy Pelosi, D-Calif.
The bonuses, totaling $165 million, were paid to employees of troubled insurer American International Group, including to traders in the unit that nearly brought about the company's collapse.
In all, 243 Democrats and 85 Republicans voted “yes” on the bill. It was opposed by six Democrats and 87 Republicans.
The margin of victory came despite sharp Republican attacks calling the legislation a legally questionable ploy to paper over Obama administration missteps.
Minority Leader John Boehner, R-Ohio, said the bill was “a political circus” diverting attention from why the administration hadn’t done more to block the bonuses before they were paid.
However, although a number of Republicans cast “no” votes against the measure at first, there was a heavy GOP migration to the “yes” side in the closing moments.
On Wednesday, the chairman and CEO of AIG acknowledged to congressional interrogators that some of the insurance giant’s executive bonuses are “distasteful.”
“We are meeting today at a high point of public anger,” Edward Liddy, chairman and chief executive officer, conceded in testimony prepared for a hearing by a House Financial Services panel. “I share that anger,” he said.
Liddy told lawmakers that the company grew into an internal hedge fund that became overexposed to market risks. AIG is the largest recipient of federal government emergency assistance. It has received $170 billion in bailout help and the government holds a nearly 80 percent stake in the company.
AIG is under fire for $220 million in retention bonuses paid to employees in its troubled financial products division. The most recent payment of $165 million began to be paid last Friday, March 13, and caused a furor.
Liddy, who has led American International Group Inc. since last fall, has become the reluctant defender of princely employee bonuses that members of Congress – and much of the American public – find indefensible.
Photo: The AIG office building in New York City.