Now, it may seem that I’m a little unfair to ole Joe Biden, making him out to be some sort of idiot and all. In the new spirit of bipartisanship that’s now SWEPT over the country (like excluding Republican ideas from stimulus legislation), I thought I’d give Joe Biden his “propas”.
First, a little setup. Let’s start with Timothy Geithner the now appointed Secretary of the Treasury, and the person in the Obama cabinet who controls the IRS:
Geithner apologizes for not paying taxes
WASHINGTON – Treasury Secretary-designate Timothy Geithner said Wednesday he was careless in failing to pay $34,000 in Social Security and Medicare taxes earlier this decade but declared “I have paid what I owed” and apologized to Congress.
He told the Senate Finance Committee he was sorry that his past transgressions were now an issue in his confirmation at a time of deepening economic distress. He urged Congress to act quickly and forcibly to deal with the crisis. A top administration priority is to foster economic recovery and “get credit flowing again,” Geithner testified.
As to his failure to pay payroll taxes from 2001 to 2004 while he worked for the International Monetary Fund, Geithner said: “These were careless mistakes. They were avoidable mistakes.”
“But they were unintentional,” he said. “I should have been more careful.”
Geithner told the panel that, for the 2001 and 2002 tax years, he had prepared his tax returns himself with a popular tax-preparation computer program.
He said that he hired an accountant to do his 2003 and 2004 taxes who also “did not catch my error.”
He acknowledged signing an IMF statement saying he was aware that it was his responsibility to fully pay U.S. Social Security and Medicare taxes.
“I absolutely should have read it more carefully,” he said. “I signed it in the mistaken belief I was complying with my obligations.”
Sen. Charles Grassley of Iowa, the senior Republican on the panel, noted that as Treasury secretary, Geithner would be in charge of the Internal Revenue Service and should therefore come under especially tight scrutiny on the issue of paying his personal taxes.
He suggested the danger of “sweeping the under the rug” Geithner’s tax problems in a rush to get him confirmed.
“I have paid what I owed,” Geithner said under grilling from Grassley. “I apologize to the committee for putting you in the position of having to spend so much time on these issues.”
Republican Jim Bunning of Kentucky told Geithner his failure to pay the taxes fully until just before his selection by Obama was announced was “hard to explain to my constituents who pay these taxes on a regular basis.”
Although the tax disclosures provided a bump in Geithner’s confirmation process, he appeared to have wide support from both parties, especially given the severity of the downturn and the nominee’s past experience in the financial system.
“You will be confirmed,” Pat Roberts of Kansas told Geithner. Still, the senator said, his phones were “ringing off the hook” from people in Kansas complaining about the prospects of having a Treasury secretary who was careless in tending to his own tax liabilities.
Grassley said he recognizes that many in Congress view Geithner, who worked closely with the outgoing administration on Wall Street’s meltdown as head of the New York Federal Reserve Bank, as “possibly the only man for the job of healing the recession before us and a very fractured economy.”
“To some, he is not only the best choice, he is the only choice,” said Grassley. The Republican has not announced how he will vote on the nomination and aides say he remains undecided.
Committee Chairman Max Baucus of Montana called Geithner’s tax transgressions “disappointing mistakes,” but said he believes they were innocent ones — and should not bar Geithner from serving in the administration’s top economic position.
Geithner, who also worked in the Treasury Department under three presidents, addressed criticism over how the $700 billion financial bailout program has been spent so far by the outgoing Bush administration.
Many lawmakers have complained that most of the over $350 billion committed so far has gone mostly to the banking industry, and has done little to help individual homeowners facing foreclosure.
Geithner also said that Obama and he “share your belief that this program needs serious reform.”
“This is an import ant program and we need to make it work,” he said. “We’re going to keep at it until we fix it.”
He said the still-evolving Obama economic plan would include a “comprehensive housing package.”
“Senators, in this crisis, our financial system failed to meet its most basic obligations,” Geithner said. “The system was too fragile and unstable, and because of this, the system was unfair and unjust. Individuals, families and businesses that were careful and responsible were damaged by the actions of those who were not. ”
He said the Obama stimulus package and related legislation would deal with the crisis in an effective way.
Geithner cited “a deep uncertainty about what tomorrow holds.”
“Our test is to act with the strength, speed, and care necessary to get our economy back on track, and to restore America’s faith in our economic future,” Geithner said.
Former Federal Reserve chairman Paul Volcker told the panel that Geithner was perhaps the best qualified individual to help fix it.
Obama last week called Geithner’s tax problems an embarrassment but an “innocent mistake.”
Geithner failed to pay $34,000 in self-employment taxes from 2001 to 2004 for money he earned while he worked at the International Monetary Fund. He paid some of the taxes in 2006 after an audit discovered the discrepancy for the years 2003 and 2004. But it wasn’t until two years later, days before Obama tapped him to head Treasury last November — that Geithner paid back taxes he owed for the years 2001 and 2002.
He did so after Obama’s transition team found that Geithner had made the same tax mistake his first two years at the IMF as the one the IRS found he made during his last two years at the international lending agency.
Yes, it’s all one big “misunderstanding”. Most people these days “forget” to pay tens of thousands of dollars in back federal taxes.
Now, onto the next story:
Tax lapses are undoing of Daschle, Killefer bids for jobs with Obama
WASHINGTON – The withdrawal of Tom Daschle’s nomination yesterday as secretary of health and human services and point man on health care reform reflected a growing recognition in the White House that his tax problems were igniting deep anger among voters across the country over an apparent double standard – calls for economic sacrifice by ordinary Americans, tolerance of laxity on taxes by Washington insiders.
Revelations that the former Senate Democratic leader had only belatedly paid $140,000 in back taxes, coming in the wake of a similar failure to meet basic tax obligations by Treasury Secretary Timothy F. Geithner, reached a tipping point yesterday, according to Democratic senators, outside supporters and President Barack Obama.
And Nancy Killefer withdrew her bid to head Obama’s new office devoted to improving government performance, acknowledging she hadn’t paid employment taxes for a household employee.
The turnaround on Daschle’s nomination occurred with lightning speed. Both Daschle and his close allies thought as late as Monday night that he could survive the controversy. By midmorning yesterday, that estimate had changed.
But the groundswell had been building outside Washington for several days. Late last week, Internet bloggers sympathetic to Obama had begun blasting Daschle on the back taxes, as well as on his ties to the pharmaceutical industry and others with stakes in health care legislation.
By early yesterday Democratic senators and administration allies outside the government had begun expressing concern to administration officials about whether Daschle could weather the criticism and remain an effective leader on health care reform.
Obama, seeking to return the focus of attention to his economic stimulus plan, moved quickly to take responsibility for the Daschle imbroglio.
“I’ve got to own up to my mistake, which is that ultimately it’s important for this administration to send a message that there aren’t two sets of rules. You know, one for prominent people and one for ordinary folks who have to pay their taxes,” Obama said in a television interview.
“And so I’m frustrated with myself, with our team. … And I’m here on television saying I screwed up and that’s part of the era of responsibility, is not never making mistakes, it’s owning up to them and trying to make sure you never repeat them and that’s what we intend to do.”
By any measure, yesterday was the most difficult day of Obama’s young presidency. He had entrusted Daschle with his most ambitious domestic priority: reducing the cost and expanding the scope of health care coverage. Even before Obama was sworn in, Daschle was traveling around the country to build support for Obama’s plans.
And Daschle was not the only Obama nominee to go down in flames yesterday over a failure to pay taxes: Nancy Killefer withdrew her bid to head Obama’s new office devoted to improving government performance, acknowledging she hadn’t paid employment taxes for a household employee.
Several weeks ago, the Obama administration told Senate staff of a tax problem involving Killefer – she hadn’t paid employment taxes for a household worker, according to a person familiar with the nomination.
In 2005, she had been hit with a $947 tax lien from the District of Columbia. The Senate at first didn’t believe the issue would doom Killefer’s chances, the person said. But the timing of the revelation turned out to be lethal – coming on top of both Daschle and Geithner.
Geithner was confirmed amid nagging concerns that the man who would oversee the Internal Revenue Service had himself failed to pay $34,000 in payroll taxes.
On Sunday, Daschle sent a letter of apology to the chairman and ranking member of the Senate Finance Committee, which was to have voted on his nomination. In the letter to Sens. Max Baucus of Montana and Charles E. Grassley of Iowa, Daschle offered regrets as well as a promise to answer any questions.
“As you can well imagine, I am deeply embarrassed and disappointed by the errors that required me to amend my tax returns,” he wrote in a letter circulated to news organizations yesterday. “I apologize for the errors and profoundly regret that you have had to devote time to them. I will be happy to answer any Committee members’ questions about these issues.”
Daschle’s withdrawal is unlikely to derail a health care reform movement that had begun gathering steam even before Obama was elected.
“If anything, there’s more urgency for us to keep up the momentum,” Baucus said yesterday.
Next, an oldie but goodie from 2008:
Rangel ethics woes take scandal spotlight off GOP
The Democratic congressman who writes the tax code will be meeting the tax collector. Republicans couldn’t be happier.
Rep. Charles B. Rangel of New York, the gravelly voiced chairman of the House Ways and Means Committee, discovered that he owes back taxes on rental income from his Dominican Republic beach villa.
Yes, we all know how often the rest of us forget to report taxes on out rental income for our Dominican Republic beach villas. Average citizens do it ALL THE TIME, and they are forgiven. We should not be so harsh on poor, poor Charlie Rangle.
And what does Joe Biden have to say about people who avoid paying taxes?
You got it. It’s time to be patriotic, Kate. Time to jump in. Time to be part of the deal.
Or how about a quote from Biden during his debate with Sarah Palin over taxes:
Well Gwen, where I come from, it’s called fairness, just simple fairness.
…but one of which is the $100 billion tax dodge that, in fact, allows people to take their post office box off- shore, avoid taxes.
I call that unpatriotic. I call that unpatriotic.
Joe Biden: the guy who proves the rule that even a blind squirrel finds a nut every now and again.