IRS, Us Treasury, Stone Court Capital discussed on Bloomberg Daybreak Asia
To audit tax evaders that it had ten years ago that's been cut back massively by years of congressional neglect. David, we have in this country a $7 trillion tax gap over the next ten years. 7 trillion dollars. I would suggest to you that a country like ours should be able to collect 5% of that. And if we do, it would make a meaningful impact on budget deficits. I think we can do better than that actually. But we're not going to do it if we have lawmakers who are demagoguing the issue as was done in too many campaign ads in this cycle. But what do you say about that? Because I know you spent a lot of time a lot of effort on this question of the tax gap. And yet it seems to have been a very effective campaign issue for a lot of Republicans. A lot of people are running against this one 87,000 agents or whatever they're talking about. Look, all anybody is talking about is returning the IRS to having the capacity to stand up for the vast majority of Americans who pay the taxes they are by collecting taxes from the people who don't pay the taxes. They owe and don't report their income or use abusive tax shelters. This is standing up for the ordinary vast majority of honest Americans. And I'm sorry that people have been able to demagogue the issue, but it's really not very complicated. It is kind of unbelievable if you think about it, David, that a few years ago, there were nearly a hundred Americans who had incomes $10 million or more who didn't even bother to file a tax return and the statute of limitations was able to pass without the IRS doing anything. That can't be the right way to run the tax collection system of the greatest country on earth. And we've got to fix that. And as we fix it, we've also got to. And this is where the people who are raising the objections are right. We've also got to make it so that when you call the IRS, the damn phone gets answered. We've also got to make it so there's a taxpayer Bill of rights and IRS agents who are trying to enforce the law aren't allowed to do the tax equivalent to the script search or to do any kind of abusive practice and absolutely these resources have to come with an enhanced commitment to the taxpayer Bill of rights. That is something very important and in all honesty, I don't think it's been said quite often enough. Well, you were just at a very powerful and you always bring so much to the table. Thank you, Larry. Really, really appreciate you being with us on the selection that is Larry summers. Of course, it's a former US Treasury degree. Now of Harvard University. Back with us now, our political contributors. Rick Davis of stone court capital and Genie Chan xeno, if I own a university, so Rick, I'm going to turn to you because you were raising the question about taxes and hiring more IRS, people, what about that? We're not going to have strip searches. Yeah, no, I think strip searches are definitely off the table. At least for tonight while the election is still going on. But look, I mean, Republicans are going to react in an opposite and equal act to what Democrats did. And especially on things that went through under sort of 51 vote rules, right? And so when you don't need 60 votes in the United States Senate, you can do whatever you want to do if you're a party in power. And I think Republicans will use this opportunity, whether it's right or wrong to roll back some of these more symbolic things that Biden and the Democrats did over the last two years. And so the difference is when Democrats could put these things into place, they had a pliable president who would sign those bills. I think Joe Biden is going to spend a lot of time vetoing legislation that makes its way if Republicans get control of the Senate in the house. It's premature to say that that's going to happen right now, but clearly that's going to be one of the dynamics if it does occur. The sad part of that was whether it's right or wrong. I mean, it's a sort of a problem in our political process. If in fact, things are right, we can't get them done because they're just not popular. That's right. And I think Larry said it so brilliantly. You know, this is this any way to run a government. It's a question we have to ask more often. You have to be able to collect taxes to pay for what we deliver in the public sphere. And that has to be a fair process, and it has been an issue that's been demagogued, particularly in this election cycle. And there's widespread misunderstanding about what this funding was for. And so I think it's very important that it be cleared up. And I think it's going to be a shame if Republicans monkey up that and don't allow it to happen. Yeah, there's some irony that some of the people who are complaining about that increase iris taxation would actually benefit the most because they wouldn't have to pay as much taxes themselves. Yeah, well, that's a bipartisan issue. But I would say this is the difference between doing things under reconciliation, which was heavily criticized this year because it was a 51 vote margin versus having bipartisan solutions, which there were many in the last two years, and they will stand the test of time. So if you have consensus in government and you can get a bipartisan approach like they did in the last two years on a number of issues, including an amazing $1 trillion infrastructure Bill, then those things will last. But if you play politics on the front end, you have to assume that politics is going to be played on you on the back end. Makes sense to me. Thanks so much to Rick Davis's stone court capital. And Jeannie chandan zano of honor university. They're going to be staying with us coming up. We're going to have more special coverage of the 2022 midterm elections. And this is Bloomberg.