What is it with the Obama administration and tax cheats? First Obama puts a tax delinquent in charge of the IRS, and then he nominates another revenue renegade to be his secretary of Health and Human Services. Sure, he’s against tax cuts for the rich, but rich Democrats who ignore their taxes are welcome in his cabinet.
Former senator Tom Dachle accepted hundreds of thousands of dollars in payment and services—consulting fees and a chauffered Cadillac—from his business partner, former Global Crossing CEO Leo Hindery Jr., an important player in the Washington–Wall Street axis. Hindery likes to give politicians a ride; back when John Edwards was going coast to coast to preach against the plutocrats in his “Two Americas” road show, he was squired around in Hindery’s corporate jet. Before signing on with Edwards’s campaign, Hindery maxed out his contributions to Hillary Clinton and Barack Obama, just to cover the bases. Of course Hindery can afford to be generous: Global Crossing will not be remembered as the world’s best-managed company, but it did pay Hindery more than $250 million for his services—all seven months’ worth. The company later went bankrupt. Obama continues to rail against executive pay—but not for those who play sugar-daddy to prominent Democrats. It’s “Two Americas,” after all.
Daschle’s problem, like Treasury chief Timothy Geithner’s, isn’t a mere tax oversight. And as with Geither’s restitution, the timing here suggests an element of bad faith—Daschle didn’t pay his back taxes until January 2, after he was nominated. He’d known that he had a potential problem since at least June—he had an accountant start looking into it at that time, right as Obama was sewing up the nomination. We’re supposed to believe it took him half a year to figure out that he had to pay taxes on a quarter-million-dollars’ worth of car service?
Daschle is the founding chairman of InterMedia, Hindery’s private-equity firm. Daschle was Majority Leader in the U.S. Senate and his wife has been both a high government official and a high-powered lobbyist. He’s no babe in the woods. Daschle, who has never bothered to register as a lobbyist, is nonetheless paid very considerable sums of money—more than $5 million in the past two years—to advise businesses on their political concerns, i.e. to act as a paid access-peddler in the familiar Washington mode. He knows that when a businessman gives the use of a Cadillac and chauffer to a former senator—a rainmaker for the politically connected K Street law firm of Alston and Bird—this isn’t just a pal loaning him his car for the day. Given that Daschle, a literal limousine liberal, put enough miles on his patron’s Cadillac to find himself liable for a six-figure tax bill on the in-kind income, this plainly was not a casual arrangement. Neither was the $83,333 he was paid by InterMedia for “consulting” service. (That $83,333 was one month’s installment on Daschle’s million-dollar-a-year consulting contract with InterMedia.)
If Daschle doesn’t know the law—for pity’s sake, he works at a law firm. This is a gratuitous insult to the people who pay taxes from the people who live off of them. Republicans in the Senate will be tempted to go along with this nonsense out of deference to a former colleague. Another prominent ex-colleague, Bob Dole, is urging them to do just that. We admire Dole, but he’s wrong on this one, and Republicans would be wrong to listen to him. Oppose Daschle.






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