Wednesday, September 9, 2009

White House Tax Panel Stays Out Of Public Eye

White House Tax Panel Stays Out Of Public Eye

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White House Tax Panel Stays Out Of Public Eye


WASHINGTON -(Dow Jones)- A task force appointed by President Obama to recommend changes to the tax code by December has held no public meetings, and the White House is not revealing with whom the group has met in private.

The secrecy surrounding the group's deliberations contrasts with President Obama's pledges of greater government openness and transparency.

Tax cuts enacted under former President George W. Bush are slated to expire at the end of 2010. That, combined with worrying projections of growth in the fiscal deficit, points to tax code changes more far-reaching than have been seen in two decades.

Obama, in March, asked former Federal Reserve Chairman Paul Volcker to lead the task force, but the day-to-day operations of the group are being run by Austan Goolsbee, a member of the White House Council of Economic Advisers.

Its members also include Harvard University economist Martin Feldstein, University of California-Berkley economist Laura Tyson, TIAA-CREF Chief Executive Roger Ferguson, and former Securities and Exchange Commission commissioner Bill Donaldson.

The group heard presentations from economists and tax policy experts during an August session at the National Bureau of Economic Research, organized by Feldstein.

Earlier this year, it heard from economists affiliated with the Tax Policy Center, a Washington think-tank.

Task force members have spoken separately with technology CEOs, according to an industry official.

"The tax reform task force is working hard on a proposal that they will present to the President in early December. They have begun meeting with outside experts and we expect to hold public meetings in the fall," said Jen Psaki, White House deputy press secretary.

The task force is an offshoot of the Volcker-led President's Economic Recovery Advisory Board. That board is subject to the Federal Advisory Committee Act, or FACA, which requires panels advising federal agencies to give notice of and open meetings to the public.

But because the tax task force is "informal," the administration believes it is not subject to FACA sunshine requirements, according to people familiar with the group.

Obama took office vowing to reverse what he called secretive practices by the Bush administration. The White House won plaudits last week for a decision to make public portions of White House visitor logs. But Patrice McDermott, director of, a coalition of watchdog groups, said Obama's record on transparency is "very mixed."

The low profile of the Obama tax task force also stands in sharp contrast to a 2005 tax reform panel appointed by then-President Bush. That group held 13 public meetings over a 10-month period, in a report that got high marks from economists but was widely scorned by lawmakers.

Rosanne Altshuler, who was senior staff economist to that panel and now co- directs the Tax Policy Center, said the group benefitted from hearing from a diverse range of taxpayers about problems with the code. "You and I are touched by the tax system in a very different way than low-income individuals," she said.

The 2005 panel also drew criticism for forming sub-groups that circumvented the FACA open meeting requirements.

William Frenzel, a former Republican member of Congress who served on the Bush tax reform panel, said he believes the effort at transparency ultimately helped to doom the panel's recommendations. Public meetings put lobbyists on notice of the group's thinking on such issues as the home mortgage interest deduction, giving them time to organize against it.

"My recommendation for the current group is that they continue to operate as quietly as the law will allow them," said Frenzel.

The mandate of the Volcker task force is narrower than that of the 2005 Bush panel, which had authority to recommend a complete tax code re-write.

Obama asked the Volcker panel to come up with ways to simplify the code, improve tax compliance and close corporate tax loopholes. These are expected to be presented as a set of options, not a comprehensive blueprint for tax code overhaul. In addition, Obama instructed the group that its recommendations should not raise taxes on families making less than $250,000.

Task force members either declined to be interviewed or did not respond to interview requests.

-By Martin Vaughan, Dow Jones Newswires; 202-862-9244; martin.vaughan@

(END) Dow Jones Newswires
Copyright (c) 2009 Dow Jones & Company, Inc.

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