Republicans should vote against the confirmation of Timothy F. Geithner as Treasury secretary. There is more to Geithner’s story than a simple tax-accounting problem, and there is more at stake here than the opportunity to give Barack Obama a political black eye or to decline, in the name of bipartisanship, to do so.
Geithner failed to pay a significant sum in taxes and was obliged to send the IRS a check for some $48,000. This is not, in and of itself, a disqualifying offense. Even Albert Einstein was moved to remark that the tax code is a most difficult thing to understand. What is much more serious is that Geithner, while neglecting to pay these taxes, accepted compensation from his employer, the International Monetary Fund, intended to offset the taxes he hadn’t paid. It is difficult to understand how Geithner could accept repayment for his taxes while unaware that he owed the taxes for which he was being repaid. This problem has similarly struck Tom Ochsenschlager, a tax expert with the American Institute of Certified Public Accountants, who said, “It’s such a basic mistake that I kind of wonder if we know all the facts.” Us, too.
Having been advised of the oversight in his 2003 and 2004 tax filings, Geithner neglected to conduct even the most basic due diligence by checking his 2001 and 2002 taxes. Geithner’s explanation that he was not aware of these additional problems until November 2008 — which is to say, until his nomination to the Obama cabinet was imminent — seems to us less than credible. Were Geithner’s tax mistakes common? Byron York’s
report today suggests not. Such errors by high-ranking IMF officials appear quite rare.
Sen. Lindsey Graham reflects the thinking of many Republicans when he frets, “These are not the times to think in small political terms.” We appreciate the sentiment, but no cabinet secretary is indispensable (Obama has Larry Summers on the bench, after all), and Geithner’s non-compliance is an awful signal to send to the tax-paying public.
Consider this: Not long ago the United Way, probably the nation’s best-known charity, was the victim of an error in its tax record — an error committed by the IRS. The IRS’s response, naturally, was to put a lien on the United Way’s assets, along with charging interest and exacting penalties. (The IRS later reversed itself.) Geithner received no such rough treatment. Instead, he’s being made head tax-collector. In a republic that prides itself on being a nation of laws, there can be no separate, lenient tax code for the high and mighty while hoi polloi are left to face the ravening revenuers. If Democrats want to endorse a two-tier tax system (it’s all a mere “hiccup” says Harry Reid), Republicans should let them put up the votes for it on their own. President-elect Obama can and should do better for Treasury.
