Webb Wants Banker Tax As Amendment To Jobs Bill

Sen. Jim Webb (D-Va.), who rarely gets into battles he thinks he can't win, said on Friday that he'll push to include a windfall bonus tax as an amendment to the upcoming jobs bill.

Webb's proposal, which is joined by California Democrat Barbara Boxer, would exempt the first $400,000 of bonuses -- the amount of the president's salary, Webb notes. Any bonus money above the president's paycheck would be taxed at 50 percent.

Sen. Sherrod Brown (D-Ohio) has also proposed a tax on bailed-out bankers, though his would only exempt the first $25,000. Rep. Peter Welch (D-Vt.) has a similar proposal in the House, which also passed windfall tax legislation in March that the Senate could build on.

The tax would only apply to bankers at institutions that received more than $5 billion in bailout funds and would only apply to the year 2009.

"The Financial Times, a paper dedicated to the free market, editorialized in favor of this position at the end of last year," said Webb in a statement. "We believe this is a fair and reasonable approach. It offers equity and a level of fairness to the American taxpayers who bailed these companies out."

The Webb-Boxer amendment will be difficult to oppose politically, though Wall Street has been lobbying furiously -- with taxpayer dollars -- in opposition.

Senate Majority Leader Harry Reid (D-Nev.) said on Thursday that his jobs bill will only include four elements and a Democratic leadership aide said it has not yet been decided whether he will allow amendments.

"Our nation's financial system was saved by taxpayers -- the nurses who care for us, the truck drivers who deliver our goods, and the soldiers protecting us overseas," said Webb. "It is reasonable to ask those who are benefiting on Wall Street to help pay back the taxpayers whose investment made the success of these institutions possible. Our bill is focused and equitable. This is not class warfare. It will place a one-time, 50 percent excise tax on excessive bonuses paid to individuals working for the institutions that received more than $5 billion from the American taxpayer in 2009."

Here is the full text of the Boxer-Webb "Taxpayer Fairness Act." Here are relevant charts and here is the Financial Times editorial referenced by Webb.