Tax Lawyer's Blog

Paul Caron tells us that famed Constitutional law professor, Lawrence Tribe (one of the key “accusers” in the Robert Bork and Clarence Thomas confirmation trials) says that a 90% tax on the AIG bonuses is constitutional.

Caron sites a Wall Street Journal Blog interview with Professor Tribe in which he is asked to address whether a retroactive tax would violate either the prohibition on Bills of Attainder or Ex Post Facto laws:

Here’s Tribe on each of these issues:

Bill of Attainder: Article I, Section 9 of the Constitution prohibits Congress from passing Bills of Attainder, laws that punish a single person or specific group of people without affording them a trial.

Would a law that targeted AIG executives violate the prohibition on Bills of Attainder?

Responded Tribe:

I do think Congress (and the Executive Branch) could avoid serious Bill of Attainder problems by passing a sufficiently broad law … rather than targeting a closed class of named executives even though the prohibition against Bills of Attainder, unlike that against Ex Post Facto laws, potentially reaches civil as well as criminal penalties.

Ex Post Facto: Article I, Section 9 of the Constitution also, generally speaking, prohibits Congress from passing laws that apply retroactively.

Would a law that imposed a tax on past-gotten earnings violate the Ex Post Facto Clause?

Responded Tribe:

The Ex Post Facto Clause applies exclusively to criminal punishment and poses no difficulty here. And the fact that the measure contemplated would operate retroactively as well as prospectively doesn’t distinguish it from any number of tax and other financial measures that the Supreme Court has upheld over the claim that fundamental fairness precludes retroactively undoing contractual obligations.

Here are my humble observations:

On Bills of Attainder – If Congress does, in fact, do as Tribe suggests and passes a broad law that targets a wider group of individuals than just the AIG bonus recipients (i.e. say a law that provides that bonuses paid to executives of companies within 5 years of receiving government bailout funds will be taxed at 90%), will that be sufficient to give cover to the fact that Congress’ real intent here is to squelch public outrage by scapegoating employees who contracted for these bonuses long before the bailout funds were ever authorized?

On Ex Post Fact Laws – I admit I am not in Mr. Tribe’s constitutional law league, but I wonder, as I have suggested in previous blog posts, whether the rhetoric Congressmen are now using effectively converts what, under other circumstances would be a non-criminal matter, essentially into a criminal one.

Congressmen Harry Reid, Chuck Schumer and Charles Grassley, to name only the most conspicuous, have repeatedly used language that smacks of criminal punishment.

My Bias Disclosure

I don’t like political idealogues who adorn themselves in the attire of impartiality in order to further their private agendas.

Mr. Tribe often falls into this category.

I remember the Professor very well from 1987 when he destroyed not only Judge Robert Bork’s dream of becoming a Supreme Court Justice, but his own as well.

Since then he has systematically and consistently opposed the Supreme Court nominations of Republican Presidents while supporting those of Democrat Presidents.

Many constitutional law scholars have accused Mr. Tribe of being more of an ideologue than an impartial analyzer of the Constitution.

In fairness I must point out that the Professor has come down in favor of citizens’ Second Amendment rights and the right of the U.S. government to hold secret military trials of suspected terrorists.

But far too often Mr. Tribe does what extremely smart and facile legal ideologues usually do:

He begins with a result in mind that he personally favors then develops an eloquent legal argument in support of that result in order to create the illusion that the result was arrived at merely through the sound application of legal principles and precedent.

My Biased Conclusion

Based on Tribe’s long record of allowing his personal predelicitions to inform his legal judgments, I think it is fair to conclude that if Lawrence Tribe the professor says Congress can legally tax the AIG bonuses, then Lawrence Tribe the man wants to see them taxed.

Of course, that doesn’t necessarily mean he’s wrong.

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