For Democrats, the taxman giveth and the taxman taketh away.
High-profile tax-scofflaw Tom Daschle has been shamed out of an appointment as secretary of health and human services. And he’s not alone: President Obama will have to hunt down another candidate for the newly created position of “chief performance officer” now that his nominee, Nancy Killefer, has been torpedoed by tax delinquencies of her own. But the most outrageous offender, Timothy Geithner, was confirmed as Treasury secretary, borne aloft on an air of indispensability.
Daschle’s offenses were accepting money and services—including a chauffeur-driven Cadillac—without reporting the income to the IRS. Daschle claimed that this was a series of honest errors, but his story was never credible. Even a million-dollar-a-year guy should notice an extra check for $83,333—a month’s installment on his consulting contract. He knew who owned that Cadillac and who paid its driver. Like Geithner, the former Senate majority leader began making good on his debts when it became clear that Obama’s political rise would present opportunities for his own advancement.
Daschle’s negligence was gross, particularly for a party and an administration that have celebrated prostration before the taxman as a “patriotic duty.” But Daschle’s offenses, galling as they may be, are exceeded by those of Geithner. Indeed, of all the tax transgressions touching Obama’s circle, Geithner’s are the worst.
Not only did Geithner neglect to pay his taxes, he turned a buck by doing so—accepting payments from his employer for the very purpose of offsetting those taxes. When he took the money, he signed a statement promising to pay the taxes and then ignored his obligations—for years. Protected by a statute of limitations, he did not pay his 2001–02 taxes until his nomination made them a public issue.
If Daschle’s tax problems should bar him from managing the federal health-services bureaucracy and Killefer’s preclude her from scrutinizing the budget, how is it that Geithner’s transgressions—the worst of the lot—are insufficient to disqualify him from managing the same Internal Revenue Service whose attentions he evaded?
We must not have a two-tiered tax code. Obama should make a clean sweep of it and dismiss Geithner. He’ll land on his feet, perhaps securing a gig at Tom Daschle’s private-equity fund, where the perks are so enviable. If he does so, we recommend taking a hard look at his 1040 next year.
