(HOST) Commentator Bill Seamans has been thinking about tax evasion and what it means to be patriotic.
(SEAMANS) As a wordsmith I have considered the word "convergence" to be very interesting. In a broad sense it means that different ideas or facts sometimes come together in a thought-provoking way. I experienced a disturbing convergence of statistics the other day when, after I had just heard that 20 more GI’s and Marines had been killed in Iraq – I then read another statistic – that 52,000 Americans kept so-called "discreet" accounts with U-B-S, the largest Swiss bank. They were legally not paying U.S. taxes on an estimated 15 billion dollars of assets that they were holding secretly. Senate investigators estimate that Americans hiding their wealth overseas are avoiding about 100 billion dollars a year in taxes – a hundred billion dollars a year!!
The number of American troops dying overseas. The amount of taxable wealth Americans are secretly stashing overseas. The convergence of those statistics led me to ask, "just what is patriotism?" A dictionary tells me that a patriot is "one who loves and jealously supports one’s own country." Is hiding huge sums of taxable money needed to support one’s own country patriotic?
President Barack Obama has turned his sights on closing this tax loophole, however legal, but the defenses of financial privilege are hard to penetrate. Treasury officials are negotiating a controversial new tax treaty with the Swiss that would allow access to secret American accounts. Other options being considered would require banks to inform the I.R.S. whenever their clients wire money abroad. Another would bar our banks from dealing with any foreign bank that refuses to cooperate with our tax people.
On another track, the Government Accountability Office says that almost two-thirds of U.S. companies pay no corporate income taxes by claiming as expenses salaries, interest and other deductions to cancel out their taxable income. Companies that defer returning to the U.S. taxable profits made by their overseas subsidiaries would be another major target. President Obama blames the legal loopholes on a broken tax system that he made a campaign promise to fix.
But Obama appears heading toward one of his most difficult battles because over 200 corporations that have donated millions in campaign contributions have expressed their opposition to unlocking their tax shelters – and it’s expected that politicians fearing the loss of most of their campaign funds will find it difficult to support effective revision of the tax laws. The Obama campaign to close the legal loopholes through which billions of tax dollars are lost overseas while Main Street pays the difference will be a core political struggle that will echo the question, "just what is patriotism?"