The Campaign Spot

How Can Geithner Publicly Defend the Coming Tax Hikes?

Over at the Volokh Conspiracy, Jim Lindgren looks at TurboTax for 2004 and 2005 and says “neither of the two major errors in [Obama Treasury Secretary nominee Tim] Geithner’s returns that I explored would have been covered by interactive prompts in the 2004 or 2005 versions of TurboTax.” (He links to me and says the facts are “contrary” to yesterday’s post.) But I’m not quite sure the issue is as cut-and-dried as his conclusion makes it sound.

On the issue of deducting money paid for summer camp as a child-care expense, Lindgren notes, “If, however, you click the button ‘Learn more about this topic,’ then you see a small number of questions and answers, the last of which clearly states that overnight camps do not qualify for the credit. Accordingly, if Geithner were curious about whether these camp expenses qualified, one of the two links he might have clicked would have given him an answer.” Most people furrow their brows when they hear of this deduction, but Geither was remarkably uncurious about whether this unorthodox deduction followed the rules.

On the other question, it’s not merely what TurboTax would have told him; it was that a financial professional didn’t do the due diligence to determine what taxes he owed on that income. And again, he accepted reimbursement for paying those taxes, which, again, strains credulity that he simply innocently forgot to pay them for four consecutive years. Furthermore, there’s still the question of whether the IMF reimbursement was properly recorded as income.

The original problem is bad, but what’s exponentially more irksome is this “innocent mistake” defense we’re hearing now, like he forgot to carry the two or to cross a “t.” Dana Milbank details how Geithner and his defenders used the term “mistake” 41 times and “error” 11 times during yesterday’s hearing.

A reader put it clearly:

I think you covered this a bit ago, but I think it’s worth repeating. This guy is trying to keep his money. I think that if he would just come out and say something like, “Look,  I’m a smart guy, I make a good bit of money doing what I do and I see the Feds, the State, the county, the city all taking money out of my pocket. This really burns my hide and I decided that I was going to get really aggressive in keeping as much of that money as I possibly could. I’m sure I can spend it on better things than our Congress, my state legislature, my county supervisors, and city hall. So, sure, I didn’t pay the taxes and you know what? IT FELT GOOD. Now, I’m embarrassed that this all came out now, and I’ll make it right, but I think it is time we looked at this whole tax thing and come up with something much better because if you think I’m the only one in public service that’s done something like that, well you’re probably paying all your taxes.”

 

At least it would be honest, heck, I’d vote for him for president if he said something like that.

But Joe Biden said paying higher taxes is patriotic. At some point in the coming years, the Obama administration is going to attempt to raise taxes, and Geithner, who kept making “mistakes” that just happened to underestimate his tax bill by tens of thousands of dollars, is going to be one of the public advocates of those hikes. It stinks, but apparently Senate Republicans don’t care.

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