A Taxing Time
It's been a taxing time for President Barack Obama as several of his nominees had to bail because of tax issues, including Tom Daschle who withdrew his nomination as secretary of health and human services. (Read more in Obama Says He Erred in Nominations.)
In a television interview Obama said "that average taxpayers deserve to have public officials who pay their taxes on time."
Media Critic Howard Kurtz complimented Obama for doing what his predecessor failed to do when he messed up.
Kurtz wrote: "He took his lumps. He didn't duck or evade. He used three words we never heard from George W. Bush: "I screwed up." He also said, "I think today was an embarrassment for us." And he talked about "self-inflicted wounds."
Admitting he was wrong was bold, Kurtz further writes. "Usually when a politician makes a mistake and sits down for interviews, he tries to deflect and minimize . . . Obama didn't do that. He took responsibility and didn't put himself in the position of denying the obvious."
Emily Yoffe, however, wasn't as forgiving in her oped: Taxes? Too Busy, Busy, Busy! (Feb. 3).
Yoffe points that Daschle made millions in various jobs since leaving the Senate.
"When someone earns more per week than the U.S. median yearly household income, we naively assume that person has more sophistication about money than the rest of us," Yoffe writes. "But maybe the IRS, in an effort to find scofflaws, should have every American nominated to a Cabinet post, given the salutary effect it seems to have on one's memory of taxes unpaid."
In my column today I offhandedly said I was willing to give Daschle and others the benefit of the doubt that they weren't willfully tryng to be tax cheats. Some readers thought I should have been harsher and that I should have called them liars.
"I couldn't agree more that the tax code is too complicated," wrote Bob Doggett of Hampton, Va. "However, I don't think Dashcle and [Treasury Secretary Timothy] Geithner's tax problems are examples of that. I am sure they knew exactly what they were doing."
Another reader thought that as a small business owner and former corporate executive he would have been prosecuted and subject to tax penalties if he had done the same.
It's true. If he did what Daschle and others did, he would have had to pay penalties. But it's not true that the IRS will throw you in jail for such offenses. Unless you intentionally go out of your way to cheat or hide your income, the IRS isn't likely to press criminal charges. People are audited all the time and the IRS finds that they didn't report income or made a "mistake" in claiming a deduction they shouldn't have.
Let's not get overwrought by this and frankly we may suspect some purposeful under-reporting went on, but we don't know for sure. The IRS is pretty good at going after both little and high-profile people it has evidence of who purposely cheated on their taxes.
Nonetheless Tom Toles sums up where this all should lead in another one of his brilliant political cartoons. Check it out.
Where's the Integrity?
Let's see: The American people are bailing out one major corporation after another and what are the executives doing as they receive this welfare? They are handing out year-end bonuses: a reported $18.4 billion worth!
"The offending bonus payments suggest that Wall Street utterly fails to comprehend how its standing in the nation and the world has changed," wrote Post Columnist Eugene Robinson in See Idiots of the Universe (Feb. 3).
Robinson writes that Wall Street would "be wise to pay attention to those citizens outside, the ones with the pitchforks and the torches."
It's those people with pitchforks who are struggling to hold on to their homes.
A recent study by the Office of the Comptroller of the Currency found that "more than 50 percent of troubled homeowners had missed at least one payment six months after a lender modified their loan," reports Real Estate reporter Renae Merle.
And that percentage is rising. Read Just a Band-Aid on the Foreclosure Problem? (Feb. 3).
You know things are bad when we are thrilled to see people saving even just 3 percent of their income. But hey, we need the good news.
For the sixth consecutive month, Americans have reduced their spending and the savings rate rose by 0.8 percent to 3.6 percent.
The bad news is people are still heavily in debt. In a special report to The Post, Mark Henricks offers tips on how to maintain your cool and negotiate a debt repayment plan. For advice on what to say to get your creditor to agree to a plan read When Debt Collectors Disrupt Dinner (Feb. 1).
Henricks also identifies what debt collectors can't do. Read Borrower's Rights, Collectors' Wrongs (Feb. 1) for more.
Color of Money Challenge
I'm still looking for local couples or individuals who have lost a job or home to foreclosure and want help.
If you're having trouble with your finances, email me at email@example.com and tell me your story. In the subject line, please put "2009 Color of Money Challenge" and include your full name, address, daytime and evening telephone numbers.
It's a challenge for you to dust yourself off and start over!
No Job, No Insurance
Speaking of job loss, corporate layoffs continue and as a result people are losing their health insurance.
Many are like Jean Perry, a 57-year-old Arlington resident, who lost her job as a coffee shop manager last summer. She earned $40,000 a year. Now, she's trying to get health care at a reasonable price. She could have kept her employer-provided policy, if she paid $400 a month.
"Neither rich nor poor, this group doesn't readily qualify for public programs such as Medicaid but often can't afford to buy insurance or pay hospital, doctor and drug bills" writes John Fairhall and Kate Steadman of Kaiser Health News.
I don't want to depress you but most of us are a job away from health coverage. Read The New Uninsured (Feb. 3).
You are welcome to e-mail comments and questions to firstname.lastname@example.org. Please include your name and hometown; your comments may be used in a future column or newsletter unless otherwise requested.
Charity Brown contributed to this e-letter.