I'll give her a pass on this one

Yesterday The Plank called out Susan Collins for her opposition to the nomination of Tim Geithner. Their take:

Doesn't augur so well for the notion that GOP moderates will fall right into line for the new president--although from Obama's perspective better a meaningless protest like this than a more substantive objection to the stimulus or health care reform.
I've written about Collins and Snowe before, and I'm certainly skeptical of their moderate bona fides. (Though I'm also willing to give them credit when they live up to their reputation.) But I'm going to go out on a limb here, and give this one to Collins. Reading the substance of her statement, I think she has a valid point.

Mr. Geithner failed to pay self-employment taxes while working for the International Monetary Fund. He failed to make these tax payments despite the fact that the IMF repeatedly reminded him of this obligation. He signed paperwork acknowledging this obligation. He received extra compensation that he acknowledged at the time was for the purpose of paying this obligation. Yet when he filed tax returns for the years he was employed at the IMF, he did not pay self-employment taxes.

After working for the IMF for three years, Mr. Geithner was audited by the Internal Revenue Service in 2006, which discovered that he had failed to pay his self employment taxes. Mr. Geithner was ordered to correct his tax returns for 2003 and 2004, and he paid the amount that he owed for those years.

But Mr. Geithner had made the same omission in 2001 and 2002, years that were outside the scope of the audit. Yet having been informed by the IRS of his omission for 2003 and 2004, Mr. Geithner took no action to correct the deficiency from 2001 and 2002 -- years for which the statute of limitations had already run. In fact, Mr. Geithner chose not to make the payments until he was being considered for this position at the end of 2008.

I've read somewhere (sorry for the lack of attribution, but I sincerely can't recall where) that Geithner's excuse would be getting much more attention and derision if more people paid self-employment taxes and were thus aware of how unlikely it was that Geithner merely erred. Even the panelists on "Wait, Wait, Don't Tell Me" this weekend were making light of the, shall we say implausibility of this argument. Collins highlights this implausibility in her statement, and I have a hard time faulting her for it.

Now, admittedly, she didn't seem to have the same sense of caution when voting to confirm other questionable characters, so I'm not willing to chalk this up entirely to standing on principle. But I'll take her at her word when she opposes the nomination of someone who's apparently going to help fix our economy but can't be bothered to pay his own taxes properly.

1 comment:

  1. Hear, hear! Our new Treasury Secretary is, at best, a lying tax cheat.

    Is there really any special skill that Mr. Geithner possesses that honest, taxpaying economists do not? If not, I'm at a loss to know why Mr. Obama made this appointment, or why the Senate approved a lying tax cheat as Treasury Secretary and boss of the IRS. Well, at least we won't have to worry about any tax audits coming up with embarrassing new revelations!