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Tuesday, December 4, 2012

Bartlett: President Obama Should Replace Geithner With a Tax Expert

Fiscal Times:  Treasury Needs a Tax Expert, Not a Wall St. Banker, by Bruce Bartlett:

With the virtual certainty that Treasury Secretary Timothy Geithner will be leaving his post shortly after the new year, there is much speculation about who might replace him. At this point, I think it makes more sense to focus on the sorts of qualities the next secretary should have, rather than speculating on personalities just because they are being bandied about in the media. ...

[T]ax policy has historically been one of the Treasury secretary’s primary areas of focus. But that has changed over the last 20 years, as various secretaries have taken more interest in banking, finance and international economic issues. During both the Bill Clinton and George W. Bush administrations, Treasury ceased to be the lead agency on tax policy. The White House tended to signal general ideas about tax policy to Congress and then let it work its will.

An important consequences of this laissez-faire policy has been that the tax code has become unbelievably screwed-up as new tax provisions became layered on old ones, the interactions between old and new provisions were ignored, the administrative aspects of tax policy took a back seat to scoring cheap political points, and Treasury’s recommendations for legislative fixes to various tax problems were routinely ignored by Congress year after year.

I would emphasize that this is a bipartisan problem and has been a problem under both Republican and Democratic control of Congress. But the price has been heavy, which is why there is so much pressure to enact meaningful tax reform.

In Barack Obama’s second term, I believe that tax policy will be the Treasury secretary’s main concern. The president has a strong desire to raise tax rates on the rich and all serious budget experts know that higher revenues are essential to solving our long-term fiscal problem. And, with luck, tax reform may also be on the agenda.

For these reasons, I hope President Obama looks beyond the usual Wall Street banker-types when choosing a replacement for Mr. Geithner. I think he needs a tax guy; someone steeped in the intricacies of the tax code with long experience in tax policy.

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Comments

The Obama first term and election campaign has been simply to add more taxes to the existing taxes and exaggerate the benefits of those taxes.

I'm not sure that the second term would be much different. Reforming the tax code is a great campaign ploy that is never intended to outlive election day. It is very much like cracking down on waste, fraud and abuse. On either the question from the electorate should be "why haven't you already done that, it's part of your job?" That question never get asked.

Geithner is certainly not a tax expert since he expected everyone to believe that (a) he didn't know he had taxible income and (b) he relied on Turbo Tax to make that decision. That only happens to folks who (a) didn't read the rules; (b) didn't follow the TT questions and (c) purposely elected to not pay tax due. I've used Turbo Tax for consulting income and it handles it quite well.

Posted by: Bob G | Dec 4, 2012 8:18:55 AM

First he needs to get a tax expert as an IRS commissioner.....Shulman was a bust and had no working knowledge of the Code....a mouthpiece. It would be nice if the O administration actually had some Tax Experts in their administration. Currently economists are not working tax people and only policy wonks with no knowledge of how do a return or any other workins of the code.....get some people who actually live in the real world....

Posted by: Sid | Dec 4, 2012 10:50:56 AM

Bartlett: I think it makes more sense to focus on the sorts of qualities the next secretary should have

I don't remember Bartlett or the major media being too concerned about this when Geithner was being considered, or we would have ended up with someone actually qualified.


Bartlett: ...all serious budget experts know that higher revenues are essential to solving our long-term fiscal problem.

Sure, just automatically call everyone incompetent who doesn't agree with you and who knows that spending is the problem rather than tax revenues. Your "expert" is simply a leftist mouthpiece, Bruce.

Posted by: Woody | Dec 4, 2012 2:46:50 PM