Damage

This Wall Street Journal piece by Jonathan Weisman and Dan Fitzpatrick reports that Obama is trying to ‘soften’ the AIG reprisal bill in Congress. It doesn’t sound as if he is trying all that hard.

The White House has yet to publicly criticize the bonus tax proposals. But administration officials say privately they are concerned the House and Senate bills could lead to an exodus of employees or whole companies from the Troubled Asset Relief Program, known as TARP, as well as other government-sponsored financial rescue efforts.

He’d better dial Congress back on this unconstitutional mess or real trouble is going to break out in the financial sector:

Meanwhile, Obama aides are focusing on recrafting the Senate bill so, at the least, it won’t discourage firms from participating in a separate federal effort to unlock credit markets — a consumer-lending program known as the Term Asset-Backed Securities Loan Facility, or TALF. They also fear scaring off investment firms they need to help in a future public-private partnership to purchase from banks mortgage-backed securities and other toxic assets.

To liken this law to a banana republic is to do grave injustice to banana republics. This is, bluntly, economic suicide. Scaring off investors with ex-post-facto, confiscatory reprisal laws in an already wounded economy is insane.

Congressional Democrats (and three Republicans) passed the bill specifically allowing the AIG bonuses. Obama signed it into law. They are the ones who caused this. Now they are trying to divert attention from themselves by punishing the firm that was bound by that law to pay its contractual obligations.

That’s a series of actions bound to attract investors.

How’s that hope and change holding up?

Right about now you’d better hope you’re left with a little spare change after these fools collapse the economy completely.