On Friday, the White House announced two major appointments to the National Economic Council. One of them is Tim Wu, one of the best informed and most devastating critics of the overconcentration and abuse of economic power and privacy by the large platform monopolies Google, Amazon, Apple and Facebook.
The appointment of Wu is bold and a very big deal – especially given all the money President Biden has raised from Silicon Valley and his appointment of lawyers who have established platform monopolies for key positions in the Justice Department. Wu, a law professor in Colombia and author of several books, has a thorough knowledge of the technology industry and its abuses. He has flatly called for the tech monopoly to be broken.
Wu’s influence for the good will be more or less great, depending on who has the best antitrust jobs in the judiciary and the Federal Trade Commission. (Biden has named Rebecca Kelly Slaughter, an FTC commissioner who is a former advisor to Chuck Schumer, as acting FTC chair.)
In the same press release announcing Wu, the White House announced that Seth Harris would be the top worker in the NEC. As we wrote earlier, Harris was a proponent of the idea that gig workers should get partial labor protection but not the full range as payroll clerks. He didn’t work for Uber and Lyft directly, but helped them indirectly. (In Harris ‘defense, he’s a big advocate of the union movement at Amazon and helped convince Biden to make a strong statement defending workers’ right to unionize.)
This combination of outstanding economic dates with not so great ones has become a Biden signature. On Friday, the government also announced two important appointments to the Treasury sub-cabinet, one progressive and one deplorable. This seems to be a pattern.
The upcoming appointments have been passed on to Bloomberg by the White House, a popular media target when Team Biden wants to hold back an appointment or prevent an unauthorized shovel.
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The progressive in question is Lily Batchelder, who will be Deputy Treasury Secretary responsible for tax policy. This is a crucial date and a great choice.
Batchelder, who was a member of the Biden transition team, is perhaps best known among progressive tax reformers and admired for her work on the idea of an inheritance tax as a substitute for inheritance tax. The difference is that an estate tax, the current version, is paid from the estate and the remaining proceeds are tax-free for the heirs. In the case of inheritance tax, the proceeds are counted as taxable income.
That means that someone who inherits a great godsend pays taxes based on their income bracket. The transition from an inheritance tax to an inheritance tax is more equitable and paves the way for restoring more than just token taxes on large fortunes after decades of right-wing demonization of the “death tax”.
Batchelder is an expert on other obscure and abused parts of the tax code, such as For example, corporate write-downs, which result in large corporations paying little or no tax. Your research has debunked the idea that this tax preference actually encourages investment. When Elizabeth Warren first proposed her property tax, Batchelder pushed back against claims that it could be easily circumvented.
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There is also much work to be done to reduce tax evasion at sea. Some of this can be achieved through better enforcement strategies and more stringent regulations, as well as tax treaties. And there is the task of counteracting Trump’s tax cut. All of this will fall within the remit of Batchelder.
Her resume is far from that of a radical. She teaches tax law at NYU Law School and is another Obama White House veteran. She was deputy director of the National Economic Council for tax and budget issues in 2014 and 2015. Before that, she was Democratic tax advisor to the Senate Finance Committee under Senator Max Baucus, a budget hawk who had no clue about a leftist.
Batchelder is an interesting case of someone whose instincts are more progressive than their résumé, but whose career path is very comforting to the Clinton / Obama veterans at the top of the Biden administration. She also worked for Hillary Clinton in the 2016 presidential campaign.
It remains to be seen how much political influence Batchelder will exert. When Larry Summers was in the White House, the Treasury Department had little control over tax policy. With a strong Treasury Secretary in Janet Yellen, the finance department is likely to play a more influential role.
At the same time, the person who has Batchelder’s old job on the National Economic Council, David Kamin, is likely to have a more direct influence on Biden’s political priorities. Kamin, another professor of tax law at New York University and an Obama veteran, is said to get along well with Batchelder and show no major differences in politics or philosophy.
This combination of outstanding economic dates with not so great ones has become a Biden signature.
Natasha Sarin, whose exact location was not given, is an entirely different story. As a law professor at Penn, Sarin is a close protégé and frequent co-author of Larry Summers. Although Summers is close to persona non grata in the Biden White House for publicly attacking Biden’s economic aid package, his radioactivity does not appear to have affected sarin.
Sarin and Batchelder are an odd couple in that Sarin went out of his way to attack Warren’s proposed property tax, claiming in an article with Summers that tax evasion was easy.
In her credit, Sarin has called for improvements to the human resources and budget of the IRS, an independent agency in the Treasury. On an administrative level, the Republicans have taken the IRS out of auditing capacity in such a way that Wall Street insider tax fraud is not penalized because it is so complex that finding a volume would consume the entire audit team.
Just like the drunk looking for his keys under the lamp post because the light is there, the IRS is following the little boy with disproportionate audits of the recipients of the earned income tax credit. Revitalizing IRS capacity and morale goes hand in hand with reforming tax law.
So the continuation of the story of the Biden economic team: part exemplary, part mixed. If these rivals try to team up, it will be a trench warfare between progressive and minimalist center-left parties. Let us hope that the sheer logic of tax reform and cartel reform prevail against the commitment of the compromised candidates and that the president will be on the side of the progressives. Lincoln’s team of rivals worked for one reason only – Lincoln’s size and determination.
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