Traditionally the Treasury, like the C.I.A., stands somewhat above the political fray. Externally, it is supposed to provide objective data that Congress and the public can use to evaluate administration proposals. Internally, long-serving Treasury analysts traditionally ride herd on political appointees, warning them when their proposals are ill conceived or irresponsible.
But under the Bush administration the Treasury takes its marching orders from White House political operatives. As The New Republic points out, when John Snow meets with Karl Rove, the meetings take place in Mr. Rove's office.
To the general public, the most obvious consequence of this subservience has been Treasury's meek acquiescence in an economic policy that hasn't produced any jobs, but has produced a $450 billion deficit. Insiders, however, are if anything even more dismayed by the erosion of Treasury's intellectual integrity — an erosion exemplified by its denial and deception on the subject of tax cuts.
Here's the story: Treasury has an elaborate computer model designed to evaluate who benefits and who loses from any proposed change in tax laws. For example, the model can be used to estimate how much families in the middle of the income distribution will gain from a tax cut, or the share of that tax cut that goes to the top 1 percent of families. In the 1990's the results of such analyses were routinely made public.
But since George W. Bush came into power, the department has suppressed most of that information, releasing only partial, misleading tables. The purpose of this suppression, of course, is to conceal the extent to which Mr. Bush's tax cuts concentrate their bounty on families with very high incomes. In a stinging recent article in Tax Notes, the veteran tax analyst Martin Sullivan writes of the debate over the 2001 cut that "Treasury's analysis was so embarrassingly poor and so biased, we thought we had seen the last of its kind." But worse was to come.
Go ahead. Find out what it is. Hint: It involves trying to embarrass Howard Dean on national TV. Dean is Karl Rove's new obsession.
