The House has passed the bill to retrieve the AIG bonuses through the IRS. What's wrong with this picture? It is my judgment that there are several things wrong.

First, the government has defined someone who received a bonus as an enemy of the people, who deserves the worst punishment that any American Citizen can imagine... the wrath of the IRS. Should we (our political representatives) not be focusing our energy on the people who PAID (or authorized payment) the bonuses? Is not the criminal the person who pulls the trigger, not the person who gets hit by the bullet?

What happens if a company borrows money from a bank, and the loan is insured by the Small Business Administration. The company is borrowing government guaranteed funds, right? But then the company, through its employment contracts, pays bonuses to its employees. Does this government action set a precedent for the IRS to go after any employee who receives a bonus that is in any way connected to "government guarantees"? Perhaps the government (our elected representatives) will decide that the best way to prevent these criminals from receiving bonuses is simply to raise every one's taxes to eliminate 90% of all income over the W-2 income.

That would actually help solve the deficit problem that we are going to face in the future. But, I digress.

What about the people who pay, or authorize the payment of these bonuses? Someone has to write the check. And, what about the calendar? Or, what does the calendar have to do with it? What about bonuses that were paid in 2008? What about Merrill? Did JP Morgan or CITI or Goldman pay bonuses? Did anyone at GM or Chrysler get a bonus? Don't even talk to me about Freddie and Fanny. If any company receives "bailout" money, and PAYS unconscionable bonuses, then all such companies should return the bonus money to the government. AIG has $190MM in the bank. The government should simply require that AIG write a check and return the bonus money. When the government resorts to the IRS attack dog tactic, then our system is in serious trouble.

This, pointing the finger at the employee, the recipient of the bonus, the person who is just part of the process, is not new. The new administration has repeatedly pointed to the irresponsible behavior of those who, hoping to finally own a home for the first time in their lives, "got in over their heads" borrowing to buy that home. The administration has stated that it is this irresponsible behavior that has caused the foreclosure crisis, and so severely damaged the banking system.

Second, our elected representatives are so focused on the political issues, they are ignoring the reality of the economic issues we all face. This is truly rearranging the deck furniture on the Titanic. It is very likely that many on capitol hill are incapable of anything else. They are so petty and so self centered that they will never change, and they will continue to allow the free enterprise system to be consumed by the fires of political greed. However, I believe that there are people who have been elected, who can step up and deliver some leadership at this time of need. I do not know who there persons are. I know many of those who will not and cannot.

So far, this does not look good. At the end of the day, Consumer Confidence, which drives consumer spending that is 66% of GDP, will lead the economy back. This charade that we are watching on Capitol Hill is shaking the confidence of the consumer/taxpayer/voter to the core.