Note to Obama – Geithner more than ‘embarrassment’

Try “scofflaw” or “idiot” or “arrogant”

President-elect Barack Obama whistled past the graveyard Wednesday evening, claiming Treasury Secretary-designee Tmothy Geithner’s failure to pay FICA taxes from his time with the International Monetary Fund was an “embarrassment” for him that shouldn’t bar the Senate from confirming him.

But, the Wall Street Journal, which broke the story of Geithner’s tax problems, now has more to share. It says the IMF told Geithner he was responsible for his own FICA taxes:

Geithner … was repeatedly advised in writing by the International Monetary Fund that he would be responsible for any Social Security and Medicare taxes he owed on income he earned at the IMF between 2001 and 2004.

And not just Geithner. Answering a question I had in posts Tuesday and Wednesday, the IMF reportedly regularly did that with all such employees.

And, yet more on that from the Journal:

U.S. IMF employees regularly requested "safeguard adjustments," to see if the IMF paid them enough to cover their taxes. An IMF finance-department official, J. Carter Magill, not only checked the tax-allowance payments, but would double-check tax returns to see if U.S. citizens had filled out their tax returns correctly. Mr. Magill, who is now retired, said he doesn't think Mr. Geithner used his service.

In other words, Geither is coming off looking more and more like one of the three things listed in my subhead.

Forbes, meanwhile, adds a bit to the story on Geithner’s nanny problem. It appears he illegally employed her about three and a half months.

But that’s minor. After pointing out that the IRS, to whom Geithner had to pay those back taxes, is part of the Treasury Department, Forbes adds this:

According to the Senate committee's report, Geithner "recently filed amended tax returns" for each tax year from 2001 through 2006. However, the report doesn't specify when these returns were filed, leaving open the question about how long Geithner knew about the improprieties before he fixed them.

In short, Obama would do the country a lot of good by not only withdrawing Geithner’s name, but by sending up a new nominee with no connections to Robert Rubin or Larry Summers.