Executive Session
Floor Speech
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Mr. GRASSLEY. Mr. President, I want to speak on the nomination of the person just announced. In the process, I am going to speak about some other people who have similar issues.
Tax collection is meant to reflect shared benefits and appeal to equality as a fundamental value. However, to paraphrase George Orwell, some people are more equal than others.
More specifically, several recent Presidential nominees have apparently set themselves above the typical American citizen in the lack of importance they place on complying with their tax obligations. This certainly seems to be the case with Dr. Brainard, nominated to be Under Secretary of the Treasury for International Affairs.
As a nominee, Dr. Brainard was treated the same as any other nominee to come through the Finance Committee in the 9 years I have been either chairman or ranking member. For the past 9 years, and likely much longer, the Finance Committee has vetted all Presidential nominees referred to the committee, and that vetting includes a tax review. The tax review of Dr. Brainard uncovered three basic issues. These issues have been described in much detail in a bipartisan Finance Committee memo released November 18, 2009. I also discussed them in a statement that was printed in the Congressional Record December 23 of last year.
Those seeking to criticize the Finance Committee's vetting process are quick to mention the length of time Dr. Brainard has been a nominee. She was nominated March 23, 2009, and her hearing was held on November 20, 2009. The reason for the passage of nearly 8 months was that the nominee persisted in being evasive and nonresponsive to very basic questions arising from the routine review of tax returns. There are still questions that were not clearly or consistently answered despite multiple rounds of questions. Other questions necessitated multiple answers as new information came to light.
For example, the committee learned on October 12, 2009, nearly 7 months after the nomination, that the nominee failed to timely pay 2008 property taxes for Rappahannock County, VA, and that the nominee was delinquent while the tax vetting was going on. I have said this before. But the reason the review of Dr. Brainard took several months was that she was not forthcoming in her answers. As the committee memo details, some of her answers contradicted each other.
I ask those who are critical of the committee's treatment of this nominee if there are some things it is okay to be evasive about to the Congress of the United States. Is there a point where Congress should accept vague and unclear statements and decide it is not some sort of big deal?
Supporters of the nominee find themselves in the position of having to distort the facts in order to make their case. They say Dr. Brainard's tax problems involved small amounts of money and some mistakes, such as late payment of property taxes, and it could happen to anyone. While these statements may be true, they do not deal with the nominee's real problem which, as I have said, is her unwillingness to fully and completely answer questions from the Finance Committee.
The Finance Committee's vetting process has uncovered tax irregularities with many past and current Presidential appointees. What the committee requires is that the nominee acknowledge and fix these irregularities.
Unless these tax issues involve substantial dollar amounts, or there is information suggesting the nominee deliberately avoided fulfilling their tax liabilities, this information is not made public and the nominee is allowed to move forward. The Finance Committee is not trying to embarrass people for making simple mistakes, and neither the committee nor this Senator benefits from a lengthy vetting process.
In the case of nominees where difficulties arise to the point where our committee must release information publicly, the committee completes its review so that all information is released all at once and the nominee is allowed to review information to be released by the committee before the committee ever would release it, so that the nominee would know exactly where we are coming from.
Dr. Brainard was allowed to review the Finance Committee memo before it was released, and if she had withdrawn her nomination, that information would have remained confidential. It would not have been out there for anybody to know anything about. But we are moving forward with this nomination; hence, any sort of information is public.
Dr. Brainard is the third senior Treasury Department nominee either the Finance Committee or this Senator has taken issue with. Secretary Geithner's failure to pay his self-employment taxes as an International Monetary Fund employee is well known.
Just a few weeks ago, Jeffrey Goldstein was recess-appointed to the post of Under Secretary for Domestic Finance. While I do not believe Dr. Goldstein failed to satisfy his tax liabilities, I do have questions regarding offshore activities a private equity fund engaged in while Dr. Goldstein was a managing director.
I was in the process of asking more questions as to the business purpose of these activities and was prepared to let the nominee advance toward confirmation once these questions were answered. Dr. Goldstein was absolved of the need to respond to my questions by the recess appointment made under law by President Obama. Dr. Brainard and Secretary Geithner both had personal issues the committee released information on in a bipartisan way, and I have unresolved questions regarding offshore activities engaged in by Dr. Goldstein's previous employer.
As concerned as I am with the issues involving this specific nominee, I am even more concerned by the reaction by some to the information released by the Finance Committee on this and other recent nominees.
Dr. Brainard was the fifth nominee of the current administration to run into personal tax issues during the Finance Committee's vetting process. With the exception of one nominee, who voluntarily withdrew his nomination, all of these nominees were confirmed, or will be confirmed, as I expect Dr. Brainard to be confirmed. It is not clear that the Finance Committee vetting of nominees has served a useful purpose and information released by the Finance Committee on problematic issues surrounding nominees doesn't seem to have decreased support for their confirmations.
I am not saying that every nominee who runs into trouble should be automatically rejected. I myself voted for one of the five nominees I just mentioned. However, it does not appear that the information released by the committee on nominees in this current Congress is given much consideration.
The issues involving Dr. Brainard should have no bearing on political parties, issue positions, or who is friends with whom. The only basic issues should be that everyone needs to pay their taxes as required by law, and the nominee should be fully responsive to the Congress. In looking at the first of these issues, the nominee showed that she was deficient in the second. For the reasons I have laid out here and in earlier statements, I will vote against this nominee.
However, I do plan to vote for cloture, and I want to explain that. Despite my own opposition to the nominee, I don't want to prevent other Senators from considering the nominee, and I am not attempting to prevent the nominee from receiving an up-or-down vote.
I hope other Senators consider the information the Finance Committee has released and will consider what I have said and will come to their own decision as to which way to vote.
I yield the floor.
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