Tax issues a symbol of America’s divide

February 3, 2009

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.

Some non-profit citizens groups say it’s the classic case of different standards for the “haves” and the “have nots”. OBAMA/DASCHLE

“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.

For more Reuters political news, click here

Photo credit: Reuters/Jeff Haynes (Obama and Daschle at news conference in Chicago)

7 comments

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I am really disappointed with Obama and the democrats for their audacity to spend tax payers money on this scam of stimulus program but cheating on their taxes. These are the only ones that we know because they were exposed to the limelights. Why do we have to pay taxes if the people in charge don’t, yet they have to spend all of it. I already lost faith in the credibility of this new administration that promised transparency and change in the government’s culture of corruption. Just like all politicians, promised are meant to be broken. In such a short time, I now realized I made the wrong choice in voting for Obama. He cannot do anything to solve the nation’s problems as he promised because ha have no clue how to do it. Desperation is showing in his decisions and choices. he will not be re-elected and probably impeached sooner or later. We can now cheat on our taxes as our leaders have shown us. Monkey see, monkey do. That is now the new mantra of the United States as our leaders represent us in the world. Where is the love to the people who are suffering from this financial crisis.

Posted by Ferdie | Report as abusive

It’s no wonder democrats don’t mind raising our taxes. Why? Because they don’t pay taxes themselves.

Posted by TC | Report as abusive

We Americans are so tired of being thought of as dumb, by the rest of the world that we went to the polls in November and removed all doubt.

Posted by Terrylee | Report as abusive

the photo shows daschle biting his lip,perhaps that is symbolic of what a lot of democrats are doing now ,as it is starting to hit the fan.

Posted by brian lee | Report as abusive

Well here is your transparency folks, and what an appropriate time to have a bit of an exposé.
Just as countless other members of congress, political institutions, high society and the general public are playing the tax avoidance game, the choice is made to start throwing stones in the glass house.

Smart strategies from the opposition? A weeding out of corrupt America…?
Hands up anyone, for scrutiny from the tax man.
No excuse from the needlessly greedy.. but is it the right time?
One way of getting a few instant pennies back to alleviate the plight of the crumbling economy.. or fuel for further distraction and destruction.

Posted by Dubious | Report as abusive

dubious, what an appropriate name, encouraging to know that through the chairmanship of their various committees ,wrangle,and cris dodd have been instrumental in helping to draft the stimulus (spending)plan,unbelievable.

Posted by brian lee | Report as abusive

I agree with Brian Lee, we should break the glass house with rocks and build a house in solid bricks. Defending corruption and illegality will just embolden these crooks and use the crisis to pass bills with hidden agendas and costs in a hurry without debate and close examinations. Fight the power.

Posted by Gary Kupal | Report as abusive

[...] middle-class income earner, who plays by the rules.  I can feel the tax burdens.  Yet, there are high-income politicians not playing by the rules and avoided paying taxes.  It’s just not [...]