Would it be legal to pass a law that retroactively taxed away the bonuses of all those AIG traders who destroyed the planet? The main constitutional objections are that such a law might be construed as either ex post facto or a bill of attainder. So what about that?
Well, Conor Clarke talked to certified expert Laurence Tribe,
and he says not to worry about bill of attainder issues: "It would not be terribly difficult to structure a tax, even one that approached a rate of 100%, levied on some or all of the bonuses already handed out (or to be handed out in the future) by AIG and other recipients of federal bailout funds so that the tax would survive bill of attainder clause challenge."
Great! So what about the problem with it being retroactive? The Supreme Court has upheld retroactive taxes against ex post facto arguments before, and over at Interfluidity Steve Waldman quotes Daniel Troy,
author of Retroactive Legislation
, on a similar objection to the Superfund legislation: "Because the ex post facto clauses do not apply to civil laws, Superfund therefore would have to be characterized as punitive in nature to be classified as an ex post facto law. The current Court, though, has suggested that unless a law is exclusively
punitive, it will not come within the scope of the ex post facto clauses."
Italics mine. So it looks like the answer here is simple: even though the purpose of this tax would pretty clearly be punitive with extreme prejudice, we need to carefully pretend that it's not. And we need to make sure the legislative history shows that it's not (it should be "manifestly regulatory and fiscal" Tribe says). Then everything is kosher! We can tax their socks off!
So there you have it. Now we just have to figure out if most of these guys are actually U.S. citizens in the first place. I hear that New York state AG Andrew Cuomo is working on that.