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Bizarre Contrast On Tax Paying

By Jack M. Balkin

For those of us who hope that the Obama Administration will usher in a new day in politics, alas, recent events have raised disappointing reminders of the old. Anyone can make a mistake on taxes, of course. But the tax mistakes of Cabinent nominees Geithner (now Secretary of the Treasury) and Daschle were big ones (in amount and type of error). Daschle's mistake was especially disheartening because it exposed that he made money--big money--by cashing in on his political connections. Nothing new there.

Thankfully, Daschle withdrew from consideration, saving President Obama further embarassment (off to earn even bigger money now that his connections to the Administration have been confirmed). It's a ritual of politics for a President to stand behind the nominee under these circumstances, as Obama did, but a more dramatic statement about change would have seen the President walk to the podium and say that he is withdrawing the nomination--duly thanking Daschle for his willingness to serve, but declaring that in the new era of government high level officials will be held to a higher standard. Now that would be a new day.

But I digress.

The point of this post is to raise the odd contrast between the front page story and a back page story in the New York Times yesterday. The front page story was about Daschle (and Geithner) underpaying tens of thousands of dollars of taxes.

The back page story was about illegal immigrants who are dutifully paying taxes (according to the IRS, totalling $50 billion dollars between 1996 to 2003). Indeed, these illegal immigrants are so anxious to pay their taxes that they have utilized fraudulent social security numbers to do so. The rub is that--to the dismay of the IRS--various law enforcement authorities are now seeking to use the tax records to find the illegal immigrants and bring them to justice.

The article suggests that these illegal immigrants have an ulterior motive for paying taxes, hoping this provides evidence that they will be good citizens. And it's impossible to know whether they have paid the full amounts due. What is clear is that these people by and large do not make a lot of money, yet they willingly hand over a chunk of it to Uncle Sam, at risk of getting caught and losing everything.

The contrast seems bizarre: two public-minded elites subtantially underpay their taxes (yet earn nominations to Cabinet posts), while illegal immigrants duly pay their taxes (and authorities use these payments to track them down).

Full post as published by Balkinization on February 03, 2009 (boomark / email).