*michael parekh on IT*

ON EDUCATION IN PAKISTAN

ROOT CAUSES

There is an eye-opening story in the New York Times today on the state of education in Pakistan.  It matters to us for a whole host of reasons, not the least of it being that we may bear some responsibility for it.  First the context:

"...the state has forgotten the children here, the mullahs have not. With public education in a shambles, Pakistan’s poorest families have turned to madrasas, or Islamic schools, that feed and house the children while pushing a more militant brand of Islam than was traditional here.

The concentration of madrasas here in southern Punjab has become an urgent concern in the face of Pakistan’s expanding insurgency. The schools offer almost no instruction beyond the memorizing of the Koran, creating a widening pool of young minds that are sympathetic to militancy.

In an analysis of the profiles of suicide bombers who have struck in Punjab, the Punjab police said more than two-thirds had attended madrasas."

Bear in mind that the word "Madrasa" used in the piece simply means "School" in Arabic.  It's being used incorrectly here to refer to Islamic schools.
That aside, the piece does make some sobering points:

"President Obama said in a news conference last week that he was “gravely concerned” about the situation in Pakistan, not least because the government did not “seem to have the capacity to deliver basic services: schools, health care, rule of law, a judicial system that works for the majority of the people.”

He has asked Congress to more than triple assistance to Pakistan for nonmilitary purposes, including education. Since the Sept. 11 attacks, the United States has given Pakistan a total of $680 million in nonmilitary aid, according to the State Department, far lower than the $1 billion a year for the military.

But education has never been a priority here, and even Pakistan’s current plan to double education spending next year might collapse as have past efforts, which were thwarted by sluggish bureaucracies, unstable governments and a lack of commitment by Pakistan’s governing elite to the poor.

“This is a state that never took education seriously,” said Stephen P. Cohen, a Pakistan expert at the Brookings Institution. “I’m very pessimistic about whether the educational system can or will be reformed...”

"...Literacy in Pakistan has grown from barely 20 percent at independence 61 years ago, and the government recently improved the curriculum and reduced its emphasis on Islam.

Failures in Education

But even today, only about half of Pakistanis can read and write, far below the proportion in countries with similar per-capita income, like Vietnam. One in three school-age Pakistani children does not attend school, and of those who do, a third drop out by fifth grade, according to Unesco. Girls’ enrollment is among the lowest in the world, lagging behind Ethiopia and Yemen.

“Education in Pakistan was left to the dogs,” said Pervez Hoodbhoy, a physics professor at Quaid-e-Azam University in Islamabad who is an outspoken critic of the government’s failure to stand up to spreading Islamic militancy."

"This impoverished expanse of rural southern Punjab, where the Taliban have begun making inroads with the help of local militant groups, has one of the highest concentrations of madrasas in the country.

Of the more than 12,000 madrasas registered in Pakistan, about half are in Punjab. Experts estimate the numbers are higher: when the state tried to count them in 2005, a fifth of the areas in this province refused to register.

Though madrasas make up only about 7 percent of primary schools in Pakistan, their influence is amplified by the inadequacy of public education and the innate religiosity of the countryside, where two-thirds of people live.

The public elementary school for boys in this village is the very picture of the generations of neglect that have left many poor Pakistanis feeling abandoned by their government."

And to the point of our bearing some of the blame:

"The phenomenon began in the 1980s, when General Zia gave madrasas money and land in an American-supported policy to help Islamic fighters against the Soviet forces in Afghanistan."

The whole piece is worth reading in it's entirety, since at the minimum, it illustrates the multi-generational nature of this state of affairs.

ON ANOTHER SIDE OF DUBAI

STRETCHING LIMITS

The Independent has a long but sobering piece on the reality of Dubai titled "The Dark Side of Dubai", covering both the recent boom and the current bust.  Some searing excerpts:

"Once the manic burst of building has stopped and the whirlwind has slowed, the secrets of Dubai are slowly seeping out. This is a city built from nothing in just a few wild decades on credit and ecocide, suppression and slavery. Dubai is a living metal metaphor for the neo-liberal globalised world that may be crashing – at last – into history..."
"...There are three different Dubais, all swirling around each other. There are the expats, like Karen; there are the Emiratis, headed by Sheikh Mohammed; and then there is the foreign underclass who built the city, and are trapped here. They are hidden in plain view. You see them everywhere, in dirt-caked blue uniforms, being shouted at by their superiors, like a chain gang – but you are trained not to look..."
"I approach a blonde 17-year-old Dutch girl wandering around in hotpants, oblivious to the swarms of men gaping at her. "I love it here!" she says. "The heat, the malls, the beach!" Does it ever bother you that it's a slave society? She puts her head down, just as Sohinal did. "I try not to see," she says. Even at 17, she has learned not to look, and not to ask; that, she senses, is a transgression too far..."
"...Dubai is not just a city living beyond its financial means; it is living beyond its ecological means. You stand on a manicured Dubai lawn and watch the sprinklers spray water all around you. You see tourists flocking to swim with dolphins. You wander into a mountain-sized freezer where they have built a ski slope with real snow. And a voice at the back of your head squeaks: this is the desert. This is the most water-stressed place on the planet. How can this be happening? How is it possible?

"...Sheikh Maktoum built his showcase city in a place with no useable water. None. There is no surface water, very little acquifer, and among the lowest rainfall in the world. So Dubai drinks the sea. The Emirates' water is stripped of salt in vast desalination plants around the Gulf – making it the most expensive water on earth. It costs more than petrol to produce, and belches vast amounts of carbon dioxide into the atmosphere as it goes. It's the main reason why a resident of Dubai has the biggest average carbon footprint of any human being – more than double that of an American..."

"...Dubai had expanded so fast its sewage treatment facilities couldn't keep up. The sewage disposal trucks had to queue for three or four days at the treatment plants – so instead, they were simply drilling open the manholes and dumping the untreated sewage down them, so it flowed straight to the sea."

The whole piece is worth reading, along with the many vocal comments from many residents who take issue with many aspects of the article.

ON RE-LEARNING LESSONS FROM COLUMBINE

FRESH EYES
The Wall Street Journal has a thoughtful piece in the wake of the tenth anniversary of the Columbine High School shootings.  Some background:

"The carnage at Columbine High on April 20, 1999, prompted a swift and aggressive response around the U.S.

Hundreds of millions of dollars flooded into schools after two seniors stalked the halls of Columbine in trench coats, killing 12 students and a teacher before committing suicide in the school library.

The money -- federal, state and local -- bought metal detectors, security cameras and elaborate emergency-response plans. It put 6,300 police officers on campuses and trained students to handle bullying and manage anger.

Ten years later, the money is drying up. The primary pot of federal grants has been cut by a third, a loss of $145 million. The Justice Department has scrapped the cops in schools program, once budgeted at $180 million a year. States are slashing spending, too, or allowing districts to buy textbooks with funds once set aside for security measures."

But here's the encouraging bit:

"But as those programs fall victim to funding shortfalls, some educators are asking whether they might be able to take up the slack not by spending more money, but by reforming school culture to nurture closer bonds between students and adults..."

""A lot of what we learned coming out of Columbine didn't [require] large sums of money," said William Modzeleski, who runs the U.S. Department of Education's Office of Safe and Drug Free Schools. "School safety is more than cameras, metal detectors and police officers."

The whole piece is worth reading on the lessons learned and apparently taken to heart.  Now if we only started to look for common sense lessons from the post-9/11 era of airport security.  Maybe we won't need to take off our shoes before boarding a flight in America...sometime in this life-time.

ON MONSTROUS CHUTZPAH

STRETCHING IT

I've been a customer and fan of Monster Cable products since the 1980s, and so this article by the Wall Street Journal titled "The scariest Monster of  all sues for trademark infringement"  caught my attention:

"When Christina and Patrick Vitagliano dreamed up their Monster Mini Golf franchises -- 18-hole, indoor putting greens straddled by glow-in-the-dark statues of ghouls and gargoyles -- they never imagined that a California maker of high-end audio cables would object.

But Monster Cable Products Inc., which holds more than 70 trademarks on the word monster, challenged the Vitaglianos' trademark applications. It filed a federal lawsuit against their company in California and demanded the Rhode Island couple surrender the name and pay at least $80,000 for the right to use it."

The piece goes on to add:

"Over the years, it has gone after purveyors of monster-branded auto transmissions, slot machines, glue, carpet-cleaning machines and an energy drink, as well as a woman who sells "Junk Food Monster" kids' T-shirts that promote good eating habits.

It sued Monster.com over the job-hunting Web site's name and Walt Disney Co. over products tied to the film "Monsters Inc." It opposed the Boston Red Sox trademark applications for seats and hot dogs named for the Green Monster, the legendary left-field wall in Fenway Park. All in all, Monster Cable says it has fought about 190 monster battles at the U.S. Patent and Trademark Office and filed around 30 monster lawsuits in federal courts."

The company founder and CEO, Noel Lee, who founded the company in 1979 and carries the title "Head Monster", has been aggressive on this front to say the least:

"To a legal novice, it may seem odd that a common word like monster can be trademarked at all. But in the complex and sometimes murky world of trademark law, common words can be registered, provided they are associated with specific classes of goods. Apple Inc., for example, holds trademarks for the word apple when it's related to computer products, not fruit.

Sometimes, trademarks can obtain a higher order of protection, known as "famous marks." This category is supposed to be reserved for words that have become so entwined with a product and a company -- like the word visa and Visa Inc.'s credit card -- that the trademark owner can argue that no other product may use the word in its name.

David Tognotti, Monster Cable's general manager and an attorney, says the company considers "Monster" a famous mark -- on a par with Barbie dolls or Camel cigarettes. "We're protecting our mark as if it's a famous mark," he said in an interview in Monster Cable's headquarters, where the walls are lined with framed copies of the company's trademarks and patents.

Mr. Tognotti cited a chapter on famous marks in the law book "McCarthy on Trademarks and Unfair Competition" by J. Thomas McCarthy, a noted expert in the field.

But in an interview, Prof. McCarthy expressed doubt that Monster Cable possesses a famous mark. He said such determinations are made by courts. Mr. Tognotti acknowledges Monster Cable hasn't obtained such a court ruling."

It's perfectly reasonable for businesses to be aggressive about protecting their assets and business interests.  But this one seems to step over the line a tad, as this one piece of many found on the web indicate.  It might even be considered "Evil" by some estimates. 

Know this won't mean anything to a company with half a billion in revenues but I think I'm holding off buying Monster Cable products for now.

* Image source.

ON FINANCIAL McCARTHYISM (Part II)

COLLATERAL DAMAGE

This letter titled "Dear AIG, I Quit", written by a senior executive at the AIG Financial Products Group at the center of the current national Bonus controversy, should be a must-read for anyone with an opinion either way on this issue.  As he explains, Mr. Jake DeSantis did not have anything to do with the products that ultimately caused the downfall of AIG.  Here are some salient excerpts:

"It is with deep regret that I submit my notice of resignation from A.I.G. Financial Products. I hope you take the time to read this entire letter. Before describing the details of my decision, I want to offer some context:

I am proud of everything I have done for the commodity and equity divisions of A.I.G.-F.P. I was in no way involved in — or responsible for — the credit default swap transactions that have hamstrung A.I.G. Nor were more than a handful of the 400 current employees of A.I.G.-F.P.

Most of those responsible have left the company and have conspicuously escaped the public outrage.

After 12 months of hard work dismantling the company — during which A.I.G. reassured us many times we would be rewarded in March 2009 — we in the financial products unit have been betrayed by A.I.G. and are being unfairly persecuted by elected officials. In response to this, I will now leave the company and donate my entire post-tax retention payment to those suffering from the global economic downturn. My intent is to keep none of the money myself.

I take this action after 11 years of dedicated, honorable service to A.I.G. I can no longer effectively perform my duties in this dysfunctional environment, nor am I being paid to do so. Like you, I was asked to work for an annual salary of $1, and I agreed out of a sense of duty to the company and to the public officials who have come to its aid. Having now been let down by both, I can no longer justify spending 10, 12, 14 hours a day away from my family for the benefit of those who have let me down."

Mr. DeSantis goes on to add:

"I have the utmost respect for the civic duty that you are now performing at A.I.G. You are as blameless for these credit default swap losses as I am. You answered your country’s call and you are taking a tremendous beating for it.

But you also are aware that most of the employees of your financial products unit had nothing to do with the large losses. And I am disappointed and frustrated over your lack of support for us. I and many others in the unit feel betrayed that you failed to stand up for us in the face of untrue and unfair accusations from certain members of Congress last Wednesday and from the press over our retention payments, and that you didn’t defend us against the baseless and reckless comments made by the attorneys general of New York and Connecticut. "

It's one thing for an outsider like me to talk about how our politician and the media are encouraging what amounts to Financial McCarthyism around this issue, and quite another to read the opinion on all this from someone in the middle of all this, through no fault of their own.
What's particularly poignant is the way he goes on to describe his decision process regarding the compensation these he and his peers were due for hard work done in good faith:

"You’ve now asked the current employees of A.I.G.-F.P. to repay these earnings. As you can imagine, there has been a tremendous amount of serious thought and heated discussion about how we should respond to this breach of trust.

As most of us have done nothing wrong, guilt is not a motivation to surrender our earnings. We have worked 12 long months under these contracts and now deserve to be paid as promised. None of us should be cheated of our payments any more than a plumber should be cheated after he has fixed the pipes but a careless electrician causes a fire that burns down the house.

Many of the employees have, in the past six months, turned down job offers from more stable employers, based on A.I.G.’s assurances that the contracts would be honored. They are now angry about having been misled by A.I.G.’s promises and are not inclined to return the money as a favor to you.

The only real motivation that anyone at A.I.G.-F.P. now has is fear.
Mr. Cuomo has threatened to “name and shame,” and his counterpart in Connecticut, Richard Blumenthal, has made similar threats — even though attorneys general are supposed to stand for due process, to conduct trials in courts and not the press."

He goes on to describe how he's donating what''ll be left of his bonus to people affected by the global downturn.
In yesterday's post, I described what was going on in the context of getting AIG employees to "return" their bonuses as "Reputational Waterboarding". 
It's clear from the comments by folks like Mr. DeSantis and others that are sure to follow, that we'll look back at this period in our history and feel the same national shame over how we're treating what's left of AIG and the financial industry at large (aka "Wall Street"), as we now do over our treatment of U.S. citizens of Japanese origin interned in camps during World War II, and the lives of thousands of Americans carelessly trampled during the McCarthy hysteria in the Fifties. 
This one hasn't been going that long and the collateral damage is not as bad as it could be. 

So it's not too late for us to all calm down a little bit, take a deep breath, and think some more about our misdirected rage. 

Oh, and let's not rush to cancel those AIG policies, unless of course we get a better deal.

Update:  Fred Wilson also had a post on this matter yesterday that's worth read, especially the comments from his readers on either side of this issue.

ON REPUTATIONAL WATERBOARDING

AT ANY COST

(Update:  Fred Wilson bravely weighs in with his thoughts on "Financial McCarthyism" as well following a recent discussion.  He makes some very good points on the subject.  The comments there are especially interesting, on both sides of the issue.)

Happy days are here again, at least for today, as the markets enjoyed a 500 point rally, giving us all a day to catch our breath.  It's a happy day for some politicians as well, who can claim credit for going to battle on our behalf and winning a victory on the AIG bonuses.  As the Wall Street Journal reports with this headline, "AIG Executives to return $50 million in bonuses":

"New York Attorney General Andrew Cuomo said late Monday that 15 of the top 20 recipients of $165 million in retention bonuses from American International Group Inc.'s Financial Products unit have agreed to give back their bonuses -- amounting to an excess of $50 million in cash.

Of the $165 million in controversial bonuses, 47%, or about $80 million of it, was given to Americans, Mr. Cuomo says. He is aiming to recoup that amount for AIG. He added that some non-Americans, beyond the reach of his jurisdiction, have returned their bonuses. Mr. Cuomo says his office is working both with AIG executives and with individual bonus recipients to get the bonus money back."

How did they manage to do that? According to press reports, the AG's office talked to the recipients, urging them to do the right thing, adding that they:

"...see no public interest in revealing the names of people who return their bonuses..."

"...he acknowledged that returning the money is a difficult decision for many people in the unit who were not involved in creating the problematic transactions that helped topple AIG."

Unsaid here is that there was an implicit, open-ended threat that those who didn't return their bonuses, could see their names released to the public.

Remember that many AIG employees have received death threats, and have to lead their lives with increased security.  This issue came up at the House hearings with AIG CEO Liddy, as this clip shows:

So the choice for an AIG bonus recipient in the above settlement, was to "give the money back", even if they had nothing to do with the AIG downfall, and had committed no crime, OR risk their name being released to the public at large, with all the risks and costs that entails.

Talk about an offer they couldn't refuse.

As much as the end result of all this may be great for taxpayers, one can't but feel a little guilty about the manner in which the results were accomplished.

Reputation, and the security of one's family are amongst the most precious things for most of us. 

A government threatening the loss of either of those things, explicitly or implicitly, especially when the individual has not been charged with any crime, does not feel right.

If anything, the whole episode feels like reputational waterboarding.  It's a sad continuation down the slippery slope of Financial McCarthyism I've been worrying about of late.

And though it may have paid off in the short-term, one wonders what at what cost long-term in terms of what we're really about.

* Image source.

ON FINANCIAL McCARTHYISM

PAUCITY OF HOPE

(Update:  Fred Wilson bravely weighs in with his thoughts on "Financial McCarthyism" as well following a recent discussion.  He makes some very good points on the subject.  The comments there are especially interesting, on both sides of the issue.)

Over the past few days, I've been talking about the populist outrage around AIG bonuses that is increasingly turning into naked rage, driven by politicians and the media down a slippery slope of hopeless self-destructiveness.  The current state of affairs is turning alarming, to say the least.

Thomas Friedman brings up some thoughts related to this sorry state of affairs in arresting terms:

"We’re in a once-a-century financial crisis, and yet we’ve actually descended into politics worse than usual.

There don’t seem to be any adults at the top — nobody acting larger than the moment, nobody being impelled by anything deeper than the last news cycle.

Instead, Congress is slapping together punitive tax laws overnight like some Banana Republic, our president is getting in trouble cracking jokes on Jay Leno comparing his bowling skills to a Special Olympian, and the opposition party is behaving as if its only priority is to deflate President Obama’s popularity."

It does feel like we have a vacuum of leadership at every level, and it's extinguishing hope everywhere. 

Our leaders and the media are fanning the flames of financial McCarthyism, trying to outdo each other in gathering lists of those who might have made a "bonus".

One wonders where the folks that could lead us through some of this at every level are hiding, hoping that they may yet raise their hand.

Mr. Friedman goes on though to describe why this may itself be a challenge:

"If you want to guarantee that America becomes a mediocre nation, then just keep vilifying every public figure struggling to find a way out of this crisis who stumbles once — like Treasury Secretary Timothy Geithner or A.I.G.’s $1-a-year fill-in C.E.O., Ed Liddy — and you’ll ensure that no capable person enlists in government.

You will ensure that every bank that has taken public money will try to get rid of it as fast it can, so as not to come under scrutiny, even though that would weaken their balance sheets and make them less able to lend money.

And you will ensure that we’ll never get out of this banking crisis, because the solution depends on getting private money funds to team up with the government to buy up toxic assets — and fund managers are growing terrified of any collaboration with government."

The sad thing in all this is that there are countless folks in every walk of life willing and able to do their part getting us through all this period.  We do need our leaders though to stop fanning the flames of class warfare, and doing a whole lot more to bring us together. 

After all, the house is on fire, and we need everyone's help to work together to put it out.  And soon.

ON SELF-DESTRUCTIVE RAGE (Part 2)

FOLLOW THE LEADER...NOT

Joe Nocera of the New York Times more eloquently expresses the concerns I outlined yesterday with the efforts by Congress to apply a 90% tax on bonuses to employees of TARP recipients.  He captures exactly how I felt at the end of this unbelievable week with these words:

"By week’s end, I was more depressed about the financial crisis than I’ve been since last September. Back then, the issue was the disintegration of the financial system, as the Lehman bankruptcy set off a terrible chain reaction.

Now I’m worried that the political response is making the crisis worse. The Obama administration appears to have lost its grip on Congress, while the Treasury Department always seems caught off guard by bad news.

And Congress, with its howls of rage, its chaotic, episodic reaction to the crisis, and its shameless playing to the crowds, is out of control. This week, the body politic ran off the rails.

There are times when anger is cathartic. There are other times when anger makes a bad situation worse. “We need to stop committing economic arson,” Bert Ely, a banking consultant, said to me this week. That is what Congress committed: economic arson."

He goes on to make a thoughtful case why this path is very wrong for all our interests, regardless of how angry we may be at AIG executives.

The whole piece is recommended in it's entirety, even if you think Congress is doing the right thing. 

And if you think it makes any sense at all, please, please, write your representative in Congress, and tell them not to walk us all off a cliff.

ON SELF-DESTRUCTIVE RAGE

BOILING OVER

Today was a day of extreme bad behavior by our Congressional leaders, at least in the view of this humble citizen.  As the New York Times reports:

"The House overwhelmingly approved on Thursday a near total tax on bonuses paid this year to employees of the American International Group and other firms that have accepted large amounts of federal bailout funds, rattling Wall Street as lawmakers rushed to respond to populist anger."

Despite questions about the legality of the retroactive 90 percent levy, Democrats and some Republicans said the tax on bonuses for traders, executives and bankers earning more than $250,000 was the quickest way to show angry Americans that Congress intended to recoup the extra dollars. Even backers of the measure noted it was an extraordinary step.

The House vote sent some employees into a panic about the prospect of, in effect, having to give up money they might already have spent. And it had regulators fearing it could undermine the Treasury’s efforts to stabilize the financial system if banks tried to flee the bailout program or if other firms refused to participate in coming rescue operations to protect their bonuses, some executives said. "

In their anger to punish AIG, the House action, if echoed by the Senate and passed into law by our President, would affect hundreds of thousands of Americans across the country in an extraordinarily negative manner.  As the article continues to explain:

"The legislation would apply to bonuses paid to executives at companies holding at least $5 billion in bailout money and would essentially wipe out the phenomenal paydays that have been a tradition on Wall Street, at least until the firms reduce the amount they owe taxpayers to less than $5 billion.

According to a tally by The New York Times of bailout recipients, employees at 11 institutions — including Goldman Sachs, Bank of America, Citigroup, Wells Fargo and JPMorgan Chase — would face restrictions immediately.

The current version of the Senate bill would apply to an even wider array of companies. It would tax bonuses at companies that received as little as $100 million in federal bailout assistance, though at a lower rate. "

Worse still, is that in it's quest for vindictive revenge, Congress could utterly undermine the very rescue effort of the national economy it's committed trillions of taxpayer dollars to already:

"Several banks are considering refusing to participate in government financial rescue programs if the bill passes, according to a person briefed on the banks’ plans. Hedge fund and private equity firms may also be hesitant to work in partnership with the government to purchase bad assets from banks — a central component of the Treasury Department’s coming financial recovery plan — if they think the government might later add restrictions on their pay."

Yet another awful reality that's emerging about all this is that ours leaders, including the President, may not have all the facts in their quest for retribution. 
As the Washington Post points out in an article that's a must-read, the real culprits of the AIG mess are long gone.  The people that are being nationally targeted and torn apart, not to mention physically threatened in some cases, are the folks that our government asked to stay on to undo the mess for the ultimate benefit of the tax-payer.

We all need to take a deep breath on this AIG and "Bonusgate" issue.  In our anger and need to lash out at somebody, we may be giving our leaders and the media the opportunity to take us to places that we may very well regret going to in the very near future.

* Image source.

ON EXPENSIVE OUTRAGE (part II)

FOCUSED RETRIBUTION

The furor over the AIG bonuses discussed yesterday continues today, seemingly stronger than ever.  Most of the discussions in the media, print, TV and online, continue to fan the populist outrage. 

Occasionally one can find a piece here and there that takes a breath to look at the broader implications inherent here, as this Washington Post article tries to do:

"The bonus scandal has inflamed lawmakers in both parties and could have broad repercussions, and lawmakers warned that it could serve as the death knell for further aid to the ailing sector. Obama's budget calls for allocating another $750 billion to bail out troubled firms, and his administration had hoped to quietly "wind down" operations at AIG without an excess of intervention from Congress, but both of those ambitions could be in doubt after the explosion of attention drawn by the bonuses."

In the meantime, the politicians continue to out-do each other in what they'd like to do to address the situation.  Most popular today seemed to laser-guided taxation, as the piece goes on to explain:

"Action on the legislation could begin as early as today in the Senate. A proposal from Senate Finance Committee Chairman  Max Baucus (D-Mont.) and the panel's ranking Republican,  Charles E. Grassley (R-Iowa), would levy an excise tax on both AIG and the executives who received the payments, adding up to more than 90 percent of the total of the bonuses. That tax would also apply to future bonuses awarded, either by AIG or by other firms receiving federal aid.

"Similar proposals taking shape in the House would target as much as 100 percent of the bonus money..."
"House Speaker Nancy Pelosi (D-Calif.) said the House will consider its own AIG tax bill, along with measures authorizing Attorney General Eric H. Holder Jr. to recover excessive compensation payments made by companies that received federal financial assistance and to block further bonuses at such companies. Pelosi predicted "tough questioning" today when AIG chairman and chief executive Edward M. Liddy appears before Frank's committee.

Democratic lawmakers raced to put their proposals on the table.  Reps. Steve Israel (N.Y.) and  Tim Ryan (Ohio) introduced the Bailout Bonus Tax Bracket Act to create a 100 percent tax on bonuses over $100,000 that are distributed to employees of financial firms receiving federal bailout money.  Rep. John D. Dingell (D-Mich.) offered a version that would tax such bonuses at a 95 percent rate."

Amazingly, there were some politicians who expressed some broader reservations on this move to micro-targeted taxation:

"Some Democrats expressed concerns about the tax approach. House  Majority Leader Steny H. Hoyer (D-Md.) told reporters that he worried about running afoul of the Constitution's equal-protection clause, which forbids laws that treat certain groups differently.

House Ways and Means Committee Chairman  Charles B. Rangel (N.Y.) also raised doubts about the tax idea. "It's difficult for me to think of the code as a political weapon," Rangel told a handful of reporters outside his office. "Is this an indictment or a bill?""

Kudos to both these legislators for raising some questions to a raging mob.

These seemingly small steps take us down a slippery slope that can have far greater negative consequences that are utterly unintended.  Surely the last few years should have taught us that lesson well by now.