Thursday, August 14, 2014

Don't do stupid stuff, Uncle Sam -- Aug. 14, 2014 column

By MARSHA MERCER

Maybe, as Hillary Clinton said, “Don’t do stupid stuff” isn’t a proper organizing principle for U.S. foreign policy. But it surely would be a welcome change here at home.

If only President Obama could order the federal government to stop doing stupid stuff on the home front, he might begin to rebuild people’s rock-bottom trust in government. Here’s a modest start: make sure federal workers pay their taxes.

It seems obvious to the point of absurdity that federal employees should pay what they owe or have their wages garnished, but it doesn’t always work that way.

For example, about 83,000 Pentagon employees and contractors who held or were eligible for security clearances owed $730 million in taxes in 2012, the Government Accountability Office reported last month. The median amount owed was $2,700, but people owed from $100 to millions of dollars. Most of the tax delinquents had no plan to repay their tax debt.

The report found that about 26,000 employees and contractors had access to classified information at the same time they owed federal taxes totaling $229 million, and about 6,200 of those had top-secret clearance. 

In other words, we are risking sensitive secrets to people who are vulnerable to financial pressure. As the report said, someone who is “financially overextended is at risk of having to engage in illegal acts to generate funds.”

The personal finances and tax situations of applicants for security clearances are supposedly considered, but federal law does not expressly prohibit someone with unpaid tax debt from receiving clearance. Records don’t indicate how often clearance is denied because of unpaid taxes.

Naturally, the GAO’s report prompted outrage on Capitol Hill.

“Federal tax cheats with security clearances jeopardize both our national and economic security, and could unnecessarily put our nation’s classified information at risk,” said Sen. Tom Coburn, R-Okla., in a statement. Coburn has been talking about cracking down on federal workers who don’t pay their taxes for years.  In the House, a bill to fire federal workers with unpaid tax bills failed last year.
   
But the problem doesn’t exist just at the Pentagon.

Congress could start by cleaning up Capitol Hill. About 3.24 percent of Senate workers and 4.87 percent of House workers owed $8.6 million in taxes as of last Sept. 30, according to IRS data released in May under a Freedom of Information Act request by USA Today. That’s 714 tax delinquents on Capitol Hill. The IRS didn’t say whether any members of Congress were delinquent.
  
At the White House, 36 of nearly 1,800 workers owe on their taxes for a tax delinquency rate of 2 percent. 
In all, more than 318,000 federal workers and retirees owed $3.3 billion in back taxes, USA Today reported. That’s slightly more than 3 percent.

To be fair, the proportion of tax delinquents is far higher among people not working in government than among those who do. The IRS estimates that 8.7 percent of taxpayers overall owe tax bills.

Still, it’s maddening that federal workers are skipping out on their taxes.  Not even all IRS workers pay their fair share. About 1.2 percent of IRS employees are tax scofflaws.

Even worse, some of the tax delinquents at IRS got bonuses. IRS awarded more than 1,100 employees more than $1 million in cash, 10,000 hours off and 69 step increases or promotions within a year that their tax compliance problems were substantiated, according to a report last March by the Treasury inspector general for tax administration.

For its part, IRS responded that it had examined the policies of 15 federal agencies and 13 states and found that only one agency had a rule against granting a bonus in cases of misconduct.  

It’s no wonder Americans’ trust in government has sunk to a record low. Only 13 percent of people say government in Washington can be trusted to do what’s right all or most of the time, a new CNN-IRC International Poll found. About three in four say they trust government only some of the time, and one in 10 say they never trust Washington.
  
Lack of trust maybe epidemic but it needn’t be inevitable. A first step to restoring people’s confidence is to ensuring that federal employees pay their taxes.  Government doesn’t have to do stupid stuff.

©2014 Marsha Mercer. All rights reserved.

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