TaxProf Blog

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

Monday, September 15, 2008

NY Times: Rangel Should Resign as Ways & Means Chair

The New York Times today called for Charles Rangel to step down as Chair of the House Ways & Means Committee in light of the tax issues I previously blogged here and here:

Mr. Rangel has hurt his case with clumsy, combative pleas of ignorance of the facts and law involving his Dominican villa. “We do make errors, even though we consider ourselves experts in terms of tax policy for the nation,” said the lawmaker, who has three decades’ experience on Ways and Means.

His excuse of “cultural and language barriers” with Dominican officials was, simply, offensive. “Every time I thought I was getting somewhere, they’d start speaking Spanish,” complained Mr. Rangel. At the least, the disclosures betray that gross sense of entitlement that regularly befalls politicians.

Today's Wall Street Journal has a wry take, The Education of Charlie Rangel:

House Ways and Means Chairman Charles Rangel of New York admitted last week that in recent years he has underpaid his taxes by about $10,000. Republicans are demanding that he step down as chairman pending an Ethics Committee investigation, but we're more sympathetic. Charlie is a victim of the tax code he helped to write.

His lawyer says Mr. Rangel flubbed his tax return by failing to record some $75,000 of rental income he received from a beach house he owns at a posh Dominican Republic resort. Mr. Rangel professes to have made an honest mistake, and says "I personally feel that I have done nothing morally wrong." He explained that he didn't know how much income he received from the property because his Dominican business partners would "start speaking Spanish."

Plenty of Americans know how he feels since the IRS tax form might as well be in Spanish. The tax code now runs to some 67,000 pages, and Mr. Rangel has probably written a few thousand himself in his 38 years on Capitol Hill. If even the nation's top tax writer can't figure out what to declare as income, and what not to declare, how can the rest of us be expected to get it right?

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The media want to have the power to make and break all politicians. I hope they lose this and all their other efforts to interfere with normal politics.

Rangel is an asset to Ways and Means: a likeable and enthusiastic advocate for higher taxes. Ways and Means needs someone to take that position.

Where the typical politician stabs his opponents in the back, Rangel never leaves you in doubt that he intends to beat you fair and square. He's a lion among jackals.

I wonder what Rangel did to annoy the NY Times. Keep Rangel, but replace the NY Times editorial staff.

Posted by: AMTbuff | Sep 15, 2008 9:47:15 AM

Wow, another opportunity to play "Name that Party"!

Posted by: Boris | Sep 15, 2008 11:29:04 AM

I don't think the calls for Rangel's resignation are fair.

As far as I can tell, he couldn't have benefitted win any significant way from his failure to include the detailes of his rental operation on his returns.

In fact, your previous blog posts about the Rangel mess coaxed me into crunching some numbers. I would be shocked if he ended up owing even a nickel to the IRS In fact, he might have gave up some passive losses by not preparing his returns properly. You can see my calculations at
Give me that Tax Return Charlie Rangel Before You Hurt Yourself

I say we let him correct his returns and move on.

Come to think of it, you know how they Tazer cops-in-training so they can identify with what they might have to do to others. Maybe this was a Tazer experience for Rangel. Maybe this will make him a better, more empathetic tax policy maker and cause him to simplify the tax code and oppose new tax increases.

Hope springs eternal.

Posted by: Peter | Sep 16, 2008 10:24:27 AM