Diary

Obama Appoints Tax Cop to 'Improve Government Performance'

During the presidential campaign, Barack Obama promised to go through the federal budget ‘line by line’ to root out waste. Today he announced the hiring of an experienced federal management expert to help him do that:

As the first Chief Performance Officer, working with Peter Orszag and Rob Nabors at the Office of Management and Budget, Nancy Killefer is uniquely qualified to lead that effort…

Nancy is an expert in streamlining processes and wringing out inefficiencies so that taxpayers and consumers get more for their money. And during her time at Treasury, she helped bring the Department into the twenty-first century, modernizing the IRS and preparing systems for Y2K.

By all accounts, Ms. Killefer is widely respected and accomplished. But if the primary job responsibility is to weed out waste from federal spending, why not pick someone with significant experience in that area? Obama could have looked to Tom Coburn or John McCain — or some other anti-pork crusader. He could have selected former Budget Director Jim Miller, who fought against pork and earmarks during his tenure in the office.

Iif he wanted a Democrat, he might have selected Russ Feingold, who is a darling to liberals and has established a reputation for opposing earmarks and wasteful spending. Or he might have appointed a non-partisan from a respected anti-pork group such as the Concord Coalition.

Why then, has he chosen Killefer? Probably because she brings other things to the table. While she has no discernible experience at rooting out wasteful spending, she has written on the need to improve productivity in the federal workspace, and she also has 5 years experience on the IRS Oversight Board, including 2 years as its chair. The Board’s job is to oversee the IRS, and to provide ‘long term guidance and direction.’ During her tenure, she pushed aggressively for more funding to increase audits and drive up tax collections. Here’s an excerpt from her Congressional testimony in 2004:

The IRS Oversight Board acknowledges that the IRS’s budget has increased in each year of President Bush’s Administration, and that the Administration’s request for FY2005 is significant against other non-defense, non-homeland security discretionary funding. That commitment is commendable, and the Board recognizes and thanks Secretary Snow for his efforts, especially at a time when the nation must balance many important and competing priorities.

However, the Board believes that now is a critical time for our tax system to be strengthened, not merely maintained at current levels. Enforcement activities are still at unacceptable levels…

Under the Board’s budget, the IRS would have the additional resources to:

  • Close over an additional 1,000 cases involving high risk/high-income taxpayers and promoters who avoid paying income taxes by using offshore credit cards and abusive trusts and shelters.
  • Boost audit rates by 42 percent from FY2004 to examine companies that use aggressive tax avoidance tactics, such as offshore transactions and flow-through entities.
  • Contact an additional 200,000 taxpayers who fail to file or pay taxes due; a 40 percent boost from FY2004 and a 27 percent increase from the Administration’s request. This alone will allow the IRS to collect $84 million more in revenue owed than the Administration’s request would allow…

There’s an old saying that tells us that ‘personnel=policy.’ If so, you can only conclude that Barack Obama had something else in mind than rooting out pork when he selected Killefer. After all, if you want to fight government waste, you select someone with a demonstrated ability to fight waste. If you select someone whose strength happens to be fighting to increase tax audits and drive up tax revenue, you must be after something else entirely.