The Paducah Sun: How About Ethics We Can Believe In?

The Paducah Sun Editorial

CHANGE
How about ethics we can believe in?
Wednesday, February 04, 2009

So this is the change we can believe in.

First it was Bill Richardson, whom President Obama tabbed for Secretary of Commerce. The former New Mexico governor had to withdraw his name after learning that a federal grand jury was investigating an alleged pay-to-play scheme in which financial firms received state contracts after contributing to Richardson’s political action committees.

Then it was Tim Geithner, Obama’s pick to lead the Treasury Department, who did not withdraw his name when it was disclosed that he had failed to pay $34,000 in taxes for earnings from the International Monetary Fund. Remarkably, the Senate confirmed him anyway. Although four Democrats did join 30 Republicans in opposing Geithner on the grounds that a tax cheat is unqualified to head the IRS, a division of Treasury, 10 Republicans joined 50 Democrats in giving Geithner the “benefit of the doubt.”
Doubt? Geithner himself, then working in the department he now leads, explained the IMF’s payroll tax in “expert” testimony before Congress in 1998.

Geithner failed to pay Social Security, Medicare and self-employment taxes for four years, 2001-2004. This, despite the fact that the IMF repeatedly informed its employees of their tax obligations, and he signed documents acknowledging his tax obligations. An IMF spokesman said that, contrary to assertions surrounding this embarrassing revelation, it is rare for an IMF employee not to pay the required taxes.

It was clearly more than an oversight. After the IRS audited Geithner’s returns for 2003 and 2004, he paid back taxes for only those years, not 2001 and 2002, for which the statute of limitations had conveniently arrived. Not until when he was nominated as Treasury secretary — and under political pressure to do so — did he pay the earlier back taxes. His total bill for back taxes and interest was $48,268.

The new Treasury secretary’s explanation: “These were careless mistakes.”
Write down that excuse and keep it handy in your tax files, dear reader, in case you are ever audited. The IRS is famously lenient toward “careless mistakes.”
And speaking of careless mistakes, consider President Obama’s choice to head Health and Human Services. That would be the current champion tax cheat, Tom Daschle. The former Senate majority leader, upon learning he was to be named HHS secretary, quickly paid $134,000 in back taxes and another 12 grand in accrued interest.
Obama knew all this but nominated Daschle anyway. White House press secretary Robert Gibbs summed up the administration’s take on the matter: “Nobody’s perfect.”

Nobody’s perfect? When it comes to ethics, this administration sets a high bar indeed.

Fortunately, public outrage over his tax dodging forced Daschle to abruptly withdraw his nomination yesterday.

Despite the fact that Daschle will not be, as he eagerly anticipated, “the architect of America’s health care reform,” it is instructive to tell the full story. Daschle had served, ironically, on the Senate Finance Committee, which has jurisdiction over the Treasury Department and the IRS. Even more ironically, Daschle served on the Senate Ethics Committee. He obviously approaches ethics and his tax obligations with equal seriousness.

So it’s no surprise to learn that Daschle, upon leaving the Senate, went to work in the lobbying division of the K Street law firm of Alston & Bird, despite a law prohibiting him from working as a lobbyist for one year after leaving Congress. He did not, you see, carry the title “lobbyist” — instead he was a “special policy advisor.” The firm’s clients included numerous companies with a vested interest in the future of health care.

Knowing this too, Obama selected Daschle to chart the course for the nation’s health care reform by naming him to the newly created position of health czar. So much for Obama’s vow to keep special interests out of the White House. Fortunately, the walking conflict of interest withdrew his name from that post yesterday as well.

The question for Obama remains: Are we really to put faith in this kind of change?