Transparency

Yves Smith has linked to a post by Frank Ackerman about the lack of transparency regarding global climate change:

One day in May, climate change got a lot more expensive. The price tag on emissions – the value of the damages done by one more ton of CO2 in the air – used to be a mere $25 or so, in today’s dollars, according to ananonymous government task force that met in secret in 2009-2010. Now it’s $40, according to an anonymous government task force that met in secret in early 2013.

It really is insidious what is going on.  Yves comments:

This post illustrates yet another sign of decay among the ruling classes: that of not even bothering to go through the motions of following stipulated political and regulatory processes.

It’s one thing to cut corners now and again and hope you don’t get caught out, and quite another to not even pretend to go through the motions. More and more examples are coming to light: the Snowden revelations have led some Congresscritters to engage in horrified finger-wagging over how the FISA court has served as an enabler of the installation of a massive surveillance state.

But why should they be surprised? The Administration is about to implement a patchwork version of Obamacare to make sure they can say they met the sacrosanct October 1 deadline, with little apparent concern as to how much of a train wreck results. We pointed out the other day how the SEC in its JOBS Act implementation simply ignored the requirement to consider alternative regulatory approaches, even though they were in the record and thus the SEC should have been required to address them. And of course, we have the bizarre classified status of the draft texts of the TransPacific Partnership and EU-US Trade and Investment Partnership negotiations while at the same time big corporations and lobbyists get to read and help write major sections of the drafts. In other words, formalities that were once deemed the heart of proper process are openly ignored in the mad rush to oblige the interests of the financial and business elites.

As a tax professional, I have always questioned the extent to which anonymity is such a priority in the tax area.  One of the that has arisen in connection with the 501(c)(4) "scandal" is that apparently the IRS released some information regarding applicants before they made the final decision on whether or not they qualified.   But why should this information be confidential in the first place?  I mean, these are people who are applying to the government for special dispensation - an exemption from income taxation.  Why should the fact that they are making this application be kept secret?

I have often thought the same thing about private rulings from the IRS.  Why are these things kept secret?  Does the public not have a stake if the IRS is ruling that a particular company doesn't have to pay tax on a transaction it is entering into?

There has been a growing recognition that secrecy when it comes to information about companies is one of the prime mechanisms by which people can avoid taxes.  We should be looking to find ways to increase transparency, not dilute it.