Today, the White House called Tom Daschle’s failure to pay more than $100,000 in back taxes a “serious mistake”, but reiterated their support for their nominee to head the Department of Health and Human Services. Last week, White House Press Secretary Secretary Robert Gibbs also pointed out that Treasury Secretary Geithner made honest mistakes on his taxes, that “should have been avoided”. Those mistakes amounted to over $34,000.
Out of little over a dozen cabinet nominations, President Obama was able to find two people who found IRS compliance optional. This is on the heels of the admission in 2008 that House Ways and Means Chairman Charlie Rangel, head of the nation’s tax writing committee, had failed to pay taxes on $75,000 of income from his beach side luxury condo.
Americans annually spend over 7 billion hours figuring out their federal taxes. Over 60% of them hire outside help. While not all are as fortunate as Rangel, Geithner and Daschle to have expensive Washington lawyers and accountants to help them, they do find comfort in having an honest service provider calculate their honest debt.
At what point are “honest mistakes” not acceptable to the President for jobs at this level, and if they are, what message does that send to America? While hard working Americans fear the impact of a faulty tax return, fear an audit, fill shoeboxes with receipts of clothing donations and house repairs; Cabinet nominees have a White House transition team and a team of lawyers to hide them from the wrath of the IRS.
During that same White House press briefing on January 26, Robert Gibbs said that Timothy Geithner had “unique experience”. Today, they said similar words on behalf of Tom Daschle. The most unique thing about these two is that they live by different tax rules than the ones they want to force on the American people by raising taxes, and making the tax code more complicated year in and year out.
They will in turn use those higher taxes to pass radical federal spending programs, including socialized health care and doubling the size of federal agencies like Education and Energy. While we must pay attention to their legal problems, we must also not lose sight of what they plan to do with the taxes the rest of us are paying.
The Heritage Foundation has consistently advocated for all Americans to pay less taxes because that is the true way to stimulate the economy. The poorly designed U.S. tax code places an enormous constraint on America’s international competitiveness, productivity growth, wage growth, and jobs. An alternative to the Trillion Dollar Spending Plan being debated on the Hill, the American Option Act, would benefit all Americans by:
- Reducing business taxes from 35 percent to 25 percent
- Make tax policy changes of 2001 and 2003 permanent
- Dramatically reduce the Estate Tax by 15 percent
- Keep tax rates on dividends and capital gains at 15 percent
And that is Smart Stimulus that will put put money in the pockets of taxpayers in every state, and create jobs in every state. Instead of fixing our tax system one Cabinet member at a time, let’s give all Americans the ability to create wealth, jobs and family security. President Obama spoke on the campaign trail of uniting two Americas. We would hope he would start by showing Americans there is only one standard for low taxes, and not create a separate one for the wealthy, elite or politically connected.