TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, October 10, 2005

American University President Under Fire for Lavish Spending, Failing to Pay Tax on Perks

Ladner_1We previously blogged (here, here, and here) the sordid tale of American University President Benjamin Ladner, under fire for his lavish spending habits and for failing to pay income tax on a variety of perks that would make the most piggish corporate executive blush.  The Washingon Post has run an editorial calling for his ouster, as well as a defense by Mr. Ladner:

Editorial:  Mr. Ladner's "Mistakes":

On the opposite page today we publish an essay of self-defense by the suspended president of American University. We agree with Benjamin Ladner that he should be allowed to speak to the faculty and others as his future is debated on campus. We also would suggest that much of the fault leading to his bitter confrontation with some university trustees lies with the trustees themselves for insufficient oversight and other sins. But we have a harder time accepting his assertion that his lavish, university-funded lifestyle reflects nothing but a few "minor and inadvertent" mistakes. In fact, his inability to understand the larger problem is one reason that he no longer seems suited to be president.

When the trustees meet Monday to consider Mr. Ladner's future, they will have before them a report concluding that he should repay the university more than $115,000 for personal expenditures, and that -- given his university-paid fringe benefits -- he should have reported another $350,000 in income on his tax returns for the past three years.

Mr. Ladner's defense:  My Side of the AU Debate:

Over the years I've watched public figures across the philosophical spectrum become objects of feeding frenzies by their peers, the press and the public. Once it's open season, they hardly have a chance to tell their side of the story, much less to confront their critics. Worse yet, whatever ideas they stood for or accomplishments they achieved are soon forgotten. Whether or not the charges proved true, all anyone remembers is that they were charged with something.

Now that it's happening to me, I find myself wanting to explain why I'm not guilty of these baseless allegations, while also continuing to press the central ideas and values that have marked my leadership at American University and to explain why these far-reaching changes should be continued regardless of what happens to me in the days ahead....

I acknowledge having made mistakes along the way, including minor and inadvertent financial errors, and I should be called to account -- just as any other person in a position of responsibility should. But earlier crises created the opportunity for American University to debate its future and decide how to serve our community, our country and our world more effectively. If this crisis becomes an occasion for scapegoating and silencing, an important opportunity for recovering our sense of direction will have been missed.

More Washington Post coverage:

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