Tax issues a symbol of America’s divide
It is said that death and taxes are the two things in life that one cannot avoid.
So when not one, not two, but three of President Barack Obama’s picks for his new administration turned up with tax problems, it raised questions about how people in the higher echelon of government managed to make such a mess of their annual obligations.
“If you make a mistake they come down on you like a hammer; these people apparently not. I guess it’s OK when you’re rich,” Leslie Paige, spokeswoman for Citizens Against Government Waste, said.
Timothy Geithner, former president of the New York Federal Reserve Bank, won Senate confirmation as U.S. Treasury secretary despite failure to pay some taxes.
Tom Daschle, a former Senate majority leader, paid about $140,000 in back taxes for making mistakes on tax returns. He withdrew from being considered as health secretary on Tuesday.
Daschle’s action followed on the heels of Nancy Killefer withdrawing from the nomination to be deputy director of the Office of Management and Budget because of a tax issue. She was a former Treasury official and former chair of the Internal Revenue Service oversight board.
The professional backgrounds of the three nominees left people scratching their heads over how it was possible they could have made such mistakes on their taxes.
Paige saw it as symbolic of the disconnect between the powerful and the average person in handling the labyrinth of “kafkaesque” tax laws.
“People in an elite situation, they game that situation, and they can afford to game it,” she said. “There’s a sense the tax system is to be avoided, and if you have enough lawyers and accountants you can avoid it.”
Pete Sepp, spokesman for the National Taxpayers Union, said Geithner’s tax problem was the most serious of the three.
“Granted, wealthier individuals tend to have more complicated financial situations but that’s why they hire high priced accountants,” Sepp said.
Photo credit: Reuters/Jeff Haynes (Obama and Daschle at news conference in Chicago)