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November 07, 2007



from your article...

The legislation would plug two obscure but highly controversial tax loopholes, deftly exploited by an industry that leans heavily Democratic.

Knock me over with a feather...

Ralph L

I'm never surprised when politicians sell their votes--what always shocks me is that they sell them so cheaply.

Patrick R. Sullivan

Here's how it's done with defense expenditures

Tucked away on Seattle's Portage Bay, a sleek, 85-foot speedboat sat idle for years — save for an annual jaunt to maintain its engine.

The Navy paid $4.5 million to build the boat. But months before the hull ever touched water, the Navy gave the boat to the University of Washington. The school never found a use for it, either.

Why would the Navy waste taxpayer dollars on a boat that nobody wanted?

Blame it on Sen. Patty Murray and Congressmen Norm Dicks and Brian Baird. All three exercised their political muscle to slip language into a 2002 spending bill to force the Navy to buy the boat from Edmonds shipbuilder Guardian Marine International.

Year after year, the Washington lawmakers did favors for the tiny company, inserting four "earmarks" into different bills to force the Navy and Coast Guard to buy boats they didn't ask for — $17.65 million in all. None of the boats was used as Congress intended.

The congressional trio say they were helping Guardian Marine because it had a great product. But each has also received generous campaign donations from the company's three executives, its sole employees: $14,277 to Baird, $15,000 to Murray, and $16,750 to Dicks.

Rick Ballard

"and $16,750 to Dicks"

Yeah, but what are their names?

I really can't think of anything much more futile than trying to make a hedge fund manager pay taxes. "Closing a loophole" to those guys is just an invitation to exercise creativity.


Speaking of taxes...aye caramba

Walter's donated to the DNC.

Patrick R. Sullivan

This needs no introduction:

From the citizens' point of view, the function of tax legislation is to decide who shall pay how much to finance government spending. But from Congress's point of view, tax legislation has an additional and very important function: It is a way to raise campaign funds.

Why is it that hardly a year passes without a new tax bill? The reason is that so long as a tax bill is under consideration, with many billions of dollars at stake, lobbyists are actively pressing for the introduction or retention of special provisions to benefit their clients. And so long as lobbyists are active, thousand-dollar-a-plate dinners and similar devices will tap them for campaign funds.

That is why members of Congress put such a high value on being assigned to the Ways and Means or Finance committees. And that is also why Congress has denied the citizenry the benefit of a stable tax system, changed only at long intervals, to which individuals and enterprises could adjust, rather than having to cope with continual and complex changes year after year.

The end result is a tax system so complex that literally no one can master it in full detail. (Milton Friedman, WSJ: July 7, 1986)


Well let's just see how far those donations to the "d's" goes.
As someone who has photographed Patty Murray in one of her moments of largesse--I can personally say I was not proud of trying to make her look good--but I did--and it wasn't easy.
Our US Senator delegation from WA state is an embarressment.




Can somebody help me out?

I'm looking for the Edwards quote where he was asked if Bush lied on the Iraq war Intell, and he said "It's not the truth, but it's great politics."

It seems to have slid down the memory hole of the internet.


Walter's donated to the DNC.

Did Not!

Harriette Walters





Walter's donated to the DNC.

Her pardon will be mailed Jan 21 2009-No worries.


I really can't think of anything much more futile than trying to make a hedge fund manager pay taxes. "Closing a loophole" to those guys is just an invitation to exercise creativity.

Heh. I was reading the article and they donate 2/3 to Democrats. I suppose it must be nice to write up legislation and then knowing how to exploit it to maximize profit, can't wait. I also remember a while back when the .com bubble was puffing up that someone did a study of the financial investments of Congressman and it showed the outsized returns that some of them received [it dealt with some language that was slipped into the 1996 Telecom bill and all the companies that were able to exploit it].


The only other reference I found was one you made at this site back it Feb 07-did he make the comment back in 2004?

Rick Ballard


The Friedman quote that Patrick brought to our attention should be on the wall of every voting booth. Congress earns its approval rating every damned day.


If the hedge fund was actually structured (or re-structured) as described there would be little for Congress to fret about, unless they were planning to revise the entire section of the tax code dealing with partnership taxation.

Which implies that if Congress does "close" this loophole, hedge funds will restructure and the tax bill of the managers will be little changed.

This is a bit too much like work--or this blog is getting more appealing.

All I can say is that the partnership tax laws are like the antitrust laws in that a few sentences generate pages and pages of regs interpreting congressional intent and court rulings. (In the cited section [704], some 2 pages generate over 100 pages of regs [1.704-1 - 1.704-4] at a similar type size.)

Which isn't to say that the good folks at hedge funds won't hire the best advocates money can buy, but Congress just needs to add a couple subsections to address this issue. The regs will run some 50 pages and will only be read by those of us who get paid to do so.


A few (well, many) years ago, the WSJ ran a piece on the Spring meeting of the Tax Section of the ABA. They discovered several lawyer/accountants hitting a local comedy club open mic night. One of the more popular aspiring comics spent his 15 minutes simply reading straight from the regs, with inflection and emphasis of particularly amusing phrases.


http://soccer.seniorclassaward.com/public/women/vote.aspx> VOTE JMax!

Tarheel teammates locked up in an out of town non interent ready hotel! She could use a little extra ummph today and tomorrow if you can pitch in.

Heels 3 Clemson 0 yesterday. Rematch Friday evening with Virginia.


I suspect the Diebold machine to be alternately assigning all votes to the two leading candidates.

hit and run

Heels 3 Clemson 0 yesterday. Rematch Friday evening with Virginia.

But wait! There's more!!!

LAKE BUENA VISTA, FLA. - North Carolina's stout defense held Clemson to four shots and three different forwards scored for the Tar Heels, including two goals by reserves, as top-seeded UNC downed eighth-seeded Clemson Wednesday afternoon in the quarterfinals of the 2007 ACC Tournament...

The Tar Heels opened the scoring in the 16th minute of the match on sophomore forward Nikki Washington's third goal of the season. The scoring play started when senior defender Jessica Maxwell sent a pass to sophomore forward Whitney Engen. Engen then sent a through ball to the speedy Washington who ran on to it and went 1v1 with Clemson keeper Ashley Phillips. Washington slotted her shot perfectly and UNC was up 1-0 at 15:15.

I REALLY REALLY REALLY was bummed I couldn't make it to the game last Friday.

Really bummed.

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