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More thrilling text about the tax deduction for performance-based pay

So, I did some more digging after my post talking about performance-based pay.

(The relevant points from that post: The government does not allow companies to deduct pay over $1 million for execs, but “performance-based” pay is excluded, which is why so many execs get “bonuses” no matter how badly they do their jobs).

It turned out that I’d made some errors in that post (edited now, with edits marked), but I also turned up some interesting news:

  1. In August, Senators Jack Reed (D-RI) and Richard Blumenthal (D-CT) introduced a bill to close this loophole.
  2. Closing this loophole is estimated to bring in $5 billion per year.

Okay, $5 billion doesn’t seem like much in the grand scheme of things. But remember Republicans’ brutal $40 billion cut in food stamps? That’s $40 billion over 10 years. Or $4 billion a year.

In other words, the Food Stamps cut, which has been presented as a necessary sacrifice in the name of fiscal responsibility, will save less than simply not subsidizing excessive executive bonuses.

No doubt, a party so deeply committed to fiscal responsibility will support Reed and Blumenthal’s bill. Right?

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