[crowd noise] american history tv on c-span3. today at 6:00 p.m. eastern, historian looks at the end of the civil war in the dot of the reconstruction era. >> i think we see the first convergence of the road and will become reconstruction in the summer of 1864. especially august 1864. that is a strangely specific date. let me see if i can make the case for you. at the beginning of the summer of 1864 no president of the united states had won a second term since andrew jackson. isn't that amazing? the congressional gold medal ceremony to recognize for soldiers of the civil rights movement. selmar 50 years ago a preacher and educator, as

president of the dallas county voters league invited robin -- --erend martin thinking, reverend martin luther king and the members of the southern christian leadership conference to help lead selma's voting rights protest. today the american people through their congressional representatives list of the congressional gold medal of on the courageous foot soldiers who dared to march in the 1965 voting rights movement. >> sunday morning at 10:00 on ro to the white house rewind, from the 1988 presidential campaign of new york republican congressman jack kemp as he answered questions on the editorial board from usa today. >> wiley have conservative values in conservative is go policy and defense policy, i am progressive in regard to my belief in the republican party being a lincoln party. a party of black and white and color and white-collar and of all people.

i called progressive conservative in order to differentiate myself from the idea that i'm up your skinny defending the status quo. >> at 4:00 p.m. eastern on real america, for the 50th anniversary of the gemini eight america, we show the 1966 nasa film gemini eight, this is used in flight. >> in the program, expert sit down and analyze the gemini eight flight. they know it was a three-day mission, its primary purposes include rendezvous in space with the target vehicle, first docking in space, and a two hour spacewalk. >> for the complete american history tv weekend schedule, go to c-span.org. >> this year marks the 90th anniversary of the joint committee on taxation. its history, the u.s. capital historical society brought together former committee staff members and top experts. nonpartisan, is

made up before four members of the house ys andeans committee, and for members from the senate finance committee. its professional staff of economists, accountants, attorneys assist members with all aspects of tax legislation. this panel is about 45 minutes. panel is going to examine portions of the history of the joint committee on taxation. andfirst speaker is georgie -- george yin. george? you for the u.s. capital historical society and to the joint committee, tom, and the rest of the staff for invited me toand participate. it's wonderful to see so many familiar faces enjoyed in celebrating the 90th anniversary of this great institution. i thought it would use my time to mention just a few of the surprises i discovered in

researching the history of the joint committee. truth be told, virtually everything i had learned has been very interesting, if not surprising. ourddition to satisfying curiosities, the story of the joint committee is important because the staff of this accidental committee ended up being situated right in the middle of three major intersections in government. those of the legislative and executive branches, the house and senate, and the political parties. these are the first, and i believe the only legislative committee staff to ever be so situated. in that sense, those of you who now serves or have served have been part of a grand experiment, and i hope to explore some of the implications and my broader research. that theyor reasons will a into shortly, the legislative environment has changed dramatically over the

years. we may nevertheless find instructive some of the experiences of the early staff. the on the first years of the staff, the research task was more difficult. for my paper today, i was helped with some key developments that took place during the summer of 1927 when congress was out of session, ways and means and the first chairman green was in iowa, and the small staff was in d.c.. issuessult, important were discussed by correspondence that has been preserved in the archives. once the staff is established, more communication seems to occur within the staff, rather than with outsiders. and preservation of that information is much more haphazard. some internal memos have no names or dates on them, and their important -- their importance is hard to determine. the paper trail gets harder as the size of the staff rose and

some information is not memorialized at all. unlesstional difficulty joe thorndike has worked out a special arrangement with the archivists, is that the staff arrangements from the nixon administration are on hold until 2024. they may be cleansed of tax information and be divulged to the public until 2029 at the earliest. i have been pretty good at arithmetic, i can tell you although joe may be here to tell you that part of the story at the 150th anniversary, i will not. probably my biggest surprise was the completely and intended nature of the institution congress authorized in 1926. the house wanted to create a two-year tax commission, something like the tax reform panel established over a decade ago by the bush and administration. in the early years, chairman

green continued to refer to entry the committee as a short-term institution, even though the enabling sketch placed no time limit on its existence. all of the unusual hires were temporary. even expressed caution about a promising applicant giving up a good permanent position at the treasury department to take what green believed to be only temporary employment at the joint committee. meanwhile, the senate seems to envision something like an oversight subcommittee. certainly not an organization whose staff would become deeply involved in the tax legislative process. i mentioned in my paper that that result may have been influenced by green's election as the first chairman rather than senator smooth. i was also surprised by the connection between the depletion allowance in the joint committee. in my article on the origins of the gct, i describe how the

finance committee in 1918, with no professional staff support in the legislature was totally snookered by maritime lawyer into approving over the objections of the treasury the discovery depletion allowance, the forerunner of percentage depletion. the lawyer was working for emergency federal energy agency, but he had no or little background in energy or tax. in the a wonderful scene furniture hearing with a lawyer is shown the oil and gas industries proposal. and he turns his nose up at it. inadequate, he sniffs. once the industry gets word of what's going on, they quickly get word to the senators that they are fully on board. unfortunately, aside from being too generous, the provision is a concern that the maritimee lawyer dismissed at the hearing. those problems lead to

,ifficulties at the tax agency congressional investigation, and eventually, creation of the joint committee. -- chief use of staff resourcewas a natural engineer, who skills became somewhat obsolete once percentage division was approved in 1926. i'm not sure whether the german understood that when he hired parker in that year. discovery depletion, however, was still permissible for mind property went parker wrote several early studies comparing the two provisions and exploring ways that some reform might be feasible. some of you know that there is actually another very interesting connection between depletion in the joint coittee. as herb janet told me a few the 1950's,uring following one of a number of failed attempts to cut back on the ablation allowance, joint committee staffer said

despondently, there would be a man on the moon before congress whenever do anything about it. enough, on july 21, 1969, or exactly one day after neil armstrong took his famous walk, the ways and means committee approved the first of a series of steps to limit the allowance. another interesting if not surprising matter was to learn about the pretax code world. something i'm confident to say no one here has ever experienced firsthand. prior research, i had read through all of the early income tax statutes. and found them to be quite confusing. this made me curious to understand what a pre-code world was like. one way to conceptualize commerce's problem is to consider the voluminous footnote almostl appearing after every inclusion in the current code. if there weren't a code, how

would that lobby preserved -- law the preserved? was to repealy all prior enactments, but to incorporate any still applicable plier -- prior law rules into the text of the current. that meant that the current enactment generally contained all of the law. but just imagine how would we only some of those provisions became -- and we'll believe -- on wheeled late -- all the rules now included in that section's footnotes. the other possibility, which congress generally followed beginning in 1928, was to preserve all prior enactments, and then to include in the current enactment only the rule applicable to current and future years. this process permitted each new enactments to be fairly clean.

but it meant than anyone interested in in the prior law rule had to locate the applicable statutes and make sure, of course, that it still represented good law. as the number of enactments proliferated, the research task became increasingly challenging. code asourse, without a positive law, amendments had to be made to the prior statutes, not to the code. we will have to hope that caught fires could quickly incorporate the amendments into at least their prima facie version of the code. bottom line -- for folks like john samuels and me, who sometimes bemoan the complexity of the tax law, the lesson may be it could have been worse. not surprisingly, i have not found any economic analysis in the early files. but i have found some early

documents, and i'm sure they would provide a good laugh t the economists on the staff. the connections between roswell and collins game, the longest-serving chief of staff by far and the joint committee, were all unexpected. as joe thorndike has written, mcgill was indisputably one of the most important tax officials of the 1930's. but i have no idea how involved was in the joint committee's authority. mcgill had both a personal and professional connection with the joint committee. his personal involvement was that he was asked not once, but twice to join the staff. had he accepted either of --unity, his 37 year 37 years on staff might not have happened. a professional connection occurred in 1938 when his undersecretary of the treasury, mcgill requested and obtained

the third edition of the proposed code. but then, in a lengthy address he delivered just days later, he failed to say a single word about the staff codification efforts that were that time stretching into their eighth year. in his speech, he discussed the benefits of codification, but focused attention only on an effort then going on in england, and suggested that the u.s. might want to follow the same process as the british to codify its tax laws. episode veryentire curious. as i indicate in the paper, the explanation may have been the ,nfluence of herman oliphant with treasury general counsel in 1939. he was apparently strongly opposed to convocation. of course, the main take away was congresses willingness to move ahead with this very technical piece of legislation,

notwithstanding treasuries ambivalence. given congresses prior experience with convocation, and the general absence of any professional committee staff at the time, it may have been significant that congress proceeded with the bill. i think this event could be a milestone in helping to establish the staff's reputation in the legislature. finally, i have accumulated much information about collin stamm, who appears to have been a fairly contribution will -- controversial fellow. in 1963, the d.c.'s correspondent for the new york times wrote a lengthy profile about him. interviewed persons , senator harry byrd being the lone exception, insisted upon anonymity, so they could speak candidly. time, stores began to appear in the press about how he was a cservative who was

too sympathetic to business interests. since some people on the outside, just learned being a notable exception, do not understand very well the nature of the chief of staff's job. i plan to take a close look at these claims. stamm was clearly no shrink and violet. he was once confronted in the market i sent liberal who asked him which state he represented. reportedly, stamm responded without blinking an eye, the united states. he seems also to a been a person a very high integrity. in a real stickler for enforcing policies against gifts or other private benefits. on one occasion, a lobbyist advised he was forwarding a ham to the staff. because this gift was perishable, stamm tried hard to prevent its delivery. sending a series of increasingly desperate telegrams to the

effect -- don't send that ham. last, i plan to examine the theus episode involving confirmation of the assistant secretary in 1961. the finance committee really grilled him, in part because of controversial articles he had written a few years earlier on the legislative process. some believe that his treatment was also partly attributable to disagreements he had had with stamm in the legislature process. thank you all very much for your kind attention. [applause] >> this is the first chief of staff. it collaborated on a small book

in 1935 on the british tax system, and although this picture is not dated, i'm assuming this was put together as part of the publicity for the publication. what i find particularly interesting is if you look at the background of the picture, it does appear to be a typical office building their sitting in. information, the staff's first offices in 1926 were in a partitioned area of the canon dining room. that was one choice. the other choice was a basement office in the capital. in the staff in chairman green thought that the partitioned office was at least a little more in the flow, if you will. the building that we now know of his long worth was opened in the spring of 1933. my records show that sometime in the summer or fall of that year, the staff moved into 1336 on the third floor.

they moved into the first floor offices or a first floor office in 1946. 1015, thethey got long known front office, if you will, in late 197471. 1970's, or 71. this picture is at the time of parker's resignation in 1938. you see him shaking hands with senator harrison, chairman of the joint committee of the time. yourare both wearing spiffy white outfits for a day in december. day in 1938.e it is of parker standing up, that is stamm who is already been selected to succeed him. and though this is a picture which i mentioned in the paper, this come as i have been told, is something that somebody on the staff actually drew. i don't know how you can see it. the person in the middle here it

is kind of running or fleeing the upper right-hand corner is stamm, and he's holding a young child known as the code. this is, to me, a play on the orpheus story where orpheus is saving his wife from hades. and out of the another world and bringing her back to the upper world. on the upper right-hand corner, as person who is menacing the bureau of internal revenue chief counsel. i don't know if you can see it. on the far right-hand corner, there appears to be a dog with three heads which would of course be cerberus, and it says the treasury hounds of ignorance , era, and become an delay. named afterre people that were involved in the legislative process. the lower left-hand corner shows

absolute law, that was obviously the big effort was to make this code absolute law. that's all i got. thank you. [applause] >> now we are going to skip a few years and joe thorndike's cannot talk to us a little bit about the joint committee involvement. mr. thorndike: what i have to do to get my powerpoint screen back? i'll just start by saying george has better visuals that i have. i have found over the years that if you are talking about tax to a nontax audience or history to just about anybody, the visual aids are crucial to keep people focused. in this room, it's probably a little bit easier. i can take a presumption of interest going in. i will say, as george said, that

research and tax can be difficult. any tax issue, it depends upon government office -- government documents. the national archives is very skittish about releasing inadvertently taxpayer information. they have inadvertently released it to me in the past, they get in trouble for that. it really does mean that there's kind of a curtain that comes in drops down on a lot of tax issues and makes it very hard to research. because it is actually just impossible for the archives to et their files v for text their information, so a lot of tax policy disappears. but here we have a topic which is really all about taxpayer information. it wasference being that made public, or at least a great deal of it. still, you can't come as george said, research the committee's records for their investigation of the nixon tax returns, which

means what i had in of doing here, i'm still doing it, this is a work in progress, is sort of researching around the investigation. we have the committee's report. exactly what happened, and to answer all the questions, not just look around that report. and come up with when you can. it is not a particularly reliable way of researching historical topic. for instance, just point out to me this morning that one of the conclusions -- the point that make in the paper is that after thewas said and done and deficiencies had been identified, but he agreed to pay the figure that the irs had identified. and actually, that may or may not be true. and i can't give any way that i can verify whether or not he actually paid. that's a typical example of the problem. in any case, when i tried to do is to look not so much of the investigation itself, which is to the extent that it is a

,ublished report is available but also to look at the effect of this investigation on institutions around it. particularly on say the irs, more broadly, on an institution like the tax system. the presidency, or even american politics. i think that's where we can see the importance. my title for this presentation is what nixon told an interviewer several years after he resigned the presidency. yet reason to know, make sure you pay your taxes. you can get in trouble for. he did get them quite a bit of trouble for it. this began, the whole controversy over next and tax returns began in the summer of 1973. it really didn't end until he resigned. it has been obscured in popular allegationse lurid

and deeds of the watergate break-in. wasat the time, it considered very serious and a nexus is threat to the presidency. -- x exit central essential threat to the presidency. he was known for walking around an investigation saying i think this is going to cost the president's job. he got some grief for saying it, but he believed it. the effect of this controversy was really that desperate principal effect was that it eroded faith in government. along with watergate, this is what did in the nixon administration. a bright spotre's here, is the joint committee's investigation. it's hard to find a bright spot in the story. but the joint committee gave us a sense of the value of disinterested expertise. of objective expertise. that is a much cited virtue of the joint committee for virtually the entire history.

george talks about in his paper. we speak of it now, it's almost always the first thing somebody says in describing the committee. but it's not a given. and it's not really tested until extreme moments. this was a fairly extreme moment. i think one thing that is kind of interesting here is that what strikes a lot of people is amazing is that presidents at the time of their official papers. as eisenhower says, from the time of george washington, it was the standard practice to treat presidents papers like the personal property. there's a great part of the joint committee's report on the next and returns that runs through what all the presidents did with their papers. it's shocking that so many of them burned them or otherwise destroyed them are given to family members or whatever. they were free to do whatever they wanted. congress more or less endorsed this idea what created the presidential library.

it encourage presidents to donate their papers to the federal government. their critics of this idea, i say this is government property. to me, that seems obvious, but it was anything but obvious up until the time. i use the archaic abbreviation ,or the committee's, the jci rt ct,rge has gone with the j but the name changed in 1976. they agreed this was standard practice. i like the conclusion of one legal scholar who said ultimately, it's a fight between those who wish to preserve the legacy and those who wish to preserve history. that's exactly what it is. donations were treated as deductible, charitable contributions when a president gave his neighbors to the archives, he could deduct it against any income on his taxes.

press reports suggested that eisenhower and the already taken advantage of this. certainly johnson did as well. and johnson and the than, have a couple of good pictures of them throughout this. they disgusted during this controversy. congress decided to tighten the rules on this. that the deduction available to presidents for this was too valuable. to scale ity moved back. in the tax reform act of 1969, did scaling back. up until that point, president could deduct the appreciated value of the papers against his income. he never had to pay any tax on he never had to treat a value of those papers as income. there was a huge deduction available at the end. 1969ess scale this back in to limit it to essentially the cost of the paper on which the materials were prepared. johnson shows not, when the deadline of july 26 -- he chose and other gifts

through the archives, but nixon did. 1970 three, long after this point, comes out the nixon actually gave a substantial number of boxes of material to the national archives, it took a very substantial deduction on his section 69 tax return of $500,000, more than he could deduct in a single year. initially only did was it knowledge that that was the value of the papers he donated. the washington post was struck by the size of that donation. they realize that would mean the president was paying no taxes at all, maybe a little bit and tax. they investigated it quite seriously. i worked for tax analysts. for all the years i've been there in the beginning, they always told me that tax analysts played a pivotal role of the soul thing. in my readings of history, they did play a pivotal role. it says something about the value of expertise, again.

it was a very technical dry article published about the president's donation that actually got the ball rolling. which basically, ira todd embalm said this is not a valid charitable gift, he shouldn't be able to deduct the value from his tax return. did is road tots the irs and said you need to appoint an outside investigator here. the irs is not capable of actually auditing the president's tax return seriously. with anway they would ordinary taxpayer. you need an outside investigator. you can deputize someone, we can get around restrictions on releasing taxpayer investigation, there is some way to do this. was atng they did say the same facts were known in connection with an ordinary citizen, you would've already done this. you would've already taken a hard look at these returns. little -- the white house thought very little about

that idea. and dismissed it in public comments. eventually the irs said action, we can't get around the restrictions on releasing taxpayer information, so no outside anybody to look at it. this bubbles on through the fall of 1973. until the providence journal bulletin publishes a leak they received from the disgruntled virus employee in west virginia who released data from the president's tax returns to the providence journal. and it turns out that the speculation was true, nixon had paid only $792 in federal income taxes in 1970 and $878 the next year. this was quite striking, got quite a bit of press. the white house responded by noting that the president had been audited by the irs in the past full field audit or full field examination with flying colors. nixon says this is good to know, you all should be happy that i

have been audited and i did so well, because that tells you that presidents are not exempt from what the irs does. but that didn't quiet the whole thing. tax analysts again respond to all of us by saying you really need an outside auditor here. and maybe you could ask the joint committee to do it, since they are actually already able to look at taxpayer information, but that didn't immediately go anywhere. november a speech in to vat editors, where he gave the famous i'm not a crook comments. that ashley came in reference to his personal finances, and not broadly, watergate. it was really about his finances. in thecase, nixon except inevitability of further disclosures on his personal finances. in the beginning of december, 19 73, he makes a massive release of personal financial information, including his tax returns for 1969 through 1972.

thank you. the committee undertakes a conference of review. he specifically -- a comprehensive review. he specifically asked him to look at the sales of sacramento state. i wouldills saying advise the president not to do this. the request was a gamble. it's possible that the committee , was likely that the committee was going to make life rough for him. at the same time, the joint committee had a repetition for integrity and a political analysis that was appealing to the president in this moment of crisis. as i saidverage before, the same way we talk about it now in the same breath as the committee's name -- a single reputation for expertise and integrity, and highly unusual deer in the congressional machinery. we would say that now, they were certainly saying it then.

case, the committee found that the president had not made a valid terrible gift. there was an issue of timing, a few documents have been backdated. there were also questions about the valuation of them. the deed of gift was problematic in certain ways, including the person who signed it, who appeared not to have the authority to sign on behalf of the president. they also found problems with the sale of property and the state and with the sale of his co-op apartment in new york city , neither of which he reported capital gain. there were other smaller issues as well. the deficiencies the committee identified were large. $444,000 in total deficiencies. , the69, the deficiency statute of limitations had expired, they can force the president to pay. but they did believe that the president owed really a extra nurse him for the time.

at the time estimated to be about half his net worth. is the part that might be controversial. i would be adjusted if anyone has an idea of how to answer this. nixon said he was going to pay the amount that the irs assessed him in a simultaneous re-audit. i don't know whether he actually did. nobody come of the irs or the joint committee raised in the issue of fraud or it the joint committee felt he didn't have the authority to do that. this is my last one. damage to the irs. i think the long story here was that the irs was damaged by this episode. the suggestion that the agency couldn't adequately audit a prominent official, let alone the president seemed to be borne out by this. byn don alexander was quoted -- was said to believe that the agency had goofed the first time around. he commissioned a second one. when the agency didn't actually

begin the second audit, it was seen as a johnny-come-lately, the jcp is investigating, we had better do it too. i wish john was here to tell us how that happened. but i think i know what he would say. he would say the agency made a good-faith effort to repair that mistake. but it was badly damaged. it inaugurated a new tradition of financial openness by presidents, and by extension now as we see in the current debate right now today, about candidates for the presidency. thanks to richard nixon, who showed us that shenanigans could be going on, there is no expectation that presidents will be extremely forthcoming with all of their financial data, including their tax returns. i think that is a significant thing too. contributed to the passage of the president or records act to try and deal with the fact that presidents needed to ask return the records over to the government. all, and again, in the spirit of trying to look around the investigation, i think what we see here is that heather not been a body like the

joint committee, they really would have been no obvious place to go for outside assessments of the presidents returns. this is a sort of really unusual moments. we don't have to many high-profile investigations of presidents finances go on. moments in ahe key highly politicized environment expertise iscal important. washe time, warmer kaplan saying it was that for the committee, they have better things to do this and it puts them in an untenable position. nonetheless, it showed the committee to be a resource for the nation in a way that other agencies could not be trusted as much. that's it. >> thank you, joe. [applause] both, georgeyou and joe. we have a few minutes, if anyone has any questions or comments, feel free.

again, i would just ask that you keep it brief. >> [inaudible] >> ian davis, i was hired as an economist on the joint committee in 1974. i recollection is that mr. nexus scraped up some free cash, and the pardon the mr. ford wrote for him was written for all crimes and misdemeanors, not for watergate crimes and misdemeanors specifically. to allow him to evade paying the bulk of that tax that he owed. and president ford's press secretary resigned over that issue. isn't that correct? mr. thorndike: it is my understanding that the pardon was written with tax issues in

mind. i don't know if that led to him not paying. i don't know. is that common knowledge? i don't know. >> i recall press reports. mr. thorndike: it's hard to tell. thank you. to me, my bigger question at this point. the more interesting issue in a way, is the second count of the impeachment, which involved not nixon's personal filings and compliance with the law, but his abuse of the agency and going after political enemies and so forth. that was the second count of the impeachment items. >> both of which failed. they hadongress felt other issues to pursue. >> other questions? you one.et me ask can you talk at all about the

composition, the size of the composition of the staff, other than the chiefs are your paper mentions, during the time you were looking at? sure.n: it's a very small staff. they started out in divided up the staff into an investigations division in this implication division to reflect this dual congressional purpose for the committee. investigations committee had parker on it, i think there was one additional person under him, it isn't clear to me what that person's background was as such. on simple vacation, they ended up with three people, charles hamill, who had been the chair of the board of tax appeals, which was created in 1924, before joining the joint committee staff in 1927. edward mcdermott, who went on later on to found the mcdermott will firm, and emery from the we now know today.

in augustolin stand 1927 came on board. so the three of them were basically the simplification division for some time. there was one other professional higher than i did pick up, a fellow named gaston chastain. he was fairly quickly delegated to be responsible for the refund work, because the refund work came to the committee beginning in 1927, and that it was included in the revenue act of 1928. once that work at going, they obviously had to make a higher to start working on that material. >> art of ignorance, but for me, the nixon investigation was the particularly notable investigation that had been undertaken by joint committee. and then subsequently, the work on enron there was obviously a major undertaking. are there others?

mr. thorndike: george wrote about in the 1920's, the committee undertook. >> the early ones. mr. thorndike: my sense is this republic investigation thing was never the main point. and the committee to develop as the sort of expertise source for lawmakers. but certainly, it's creation of a lot to do with the idea that would be an investigating body. george is the master here. mr. yin: the background of the refund work is really quite fascinating. the refund work really was an important part of congress's in the for the gct earlier years. although there's kind of a papering over of what the refund staff was doing and whether they agree to disagree with it, the treasury, my reading is that some were actually important disagreements that would rise the level of the joint committee itself meeting to discuss substantively and debate substantively the proper

treatment of some of the big refund cases that have come up. they would have a representative of the bir there. the joint committee staffers that will be presented both sides of the issue, and the committee would ultimately result in your >> it was interesting i was thinking of the refund jurisdiction which we all tend to sort of slough off. i was involved in a matter of earlier -- late last year, which was joint committee case. the refund that went to the joint committee. attention bysed both the practitioners council appropriately,in properly, and completely documenting the resolution of the case, simply because there was this knowledge at the joint committee was going to take a look at, was quite impressive, i thought.

say, we don't spend much time talking about joint committee refund jurisdiction. mr. thorndike: that was the goal. perlman: there may be a benefit from the jurisdiction even if the joint committee doesn't recognize it that often. zuger, my question is about section 168 in the expansion, could you review your comments on section 168? i. thorndike: -- mr. yin: just picked that one out. if you turned 168, you will see pages and pages of footnotes are real reflecting and this year, this was the rule. that's the rule for depreciation and so forth. over the years, it has changed a lot. so all of that is tracked. the point is, if you didn't have a code today, that still is the law. and so you would have to kind of

reserve it in some way. the question is how do you preserve it without a code? the answer is you could put all of it into the text of the actual rule, which is mind-boggling to me, or you could do what they began doing in 1928, which is the keep the current law rule in the text of the statute. they just let the other rules remain in the statute that were previously enacted that are not repealed. the problem with that is if you are researching and try to figure out what was the law 10 years ago, you actually have to find that statute and then you have to trace every subsequent statute to make sure there was no amendment or appeal to that original statute. so you can imagine the task becomes tremendously challenging. aaron mind also that during the 1930's and 1940's, and joe knows this much better than i do, there was a tremendous amount of tax legislation coming out trade virtually a bill, a major bill every single year coming out.

point, the people who were working in this area are just getting overloaded with this delusion of information, which is all in separate little pieces. george, you mentioned the first professional was an engineer at the joint tax. i was wondering if you could talk really about the rise of the concept of the tax professional, whether it started with the government as a streamlined professional concepts, or whether was a private-sector concept that have the role of both treasury and joint tax for congress and administration in to vault in the specialized professional role? mr. thorndike: that's a good question. mr. yin: at some point, the wrecking mission and congress was that it was lawyers and economists were the two main professional, counsel also. the main professionals that need to be on the staff. they have the kind of expertise that the staff -- the commerce

really relies on. parker was unusual because he did start out with a law degree and without an economics degree. he was an engineer, a very well trained engineer, but an engineer. the reason that he came about was he had been the chief investigator of the cousins investigation committee that had been investigating all of the problems that the bureau of internal revenue had with, among other things, the depletion allowance. the rule of the time required you to value the natural resource discovery. required a valuation engineer, that was parker. he had done that. in 1926, that investigation ends, the joint committee is created, parker seven note to somebody he knows in congress and says would you consider me to be on the staff? green,nnels over to green that hires them, even though 1926, they essentially change the rules so that for oil

and gas property, it wasn't necessary to know what the value of the property was anymore, because they did percentage depletion. that's just kind of one of the ironies that i picked up. eventually, parker does complete a law degree. he must've gone and i only was working at the joint committee. he does get a law degree. i mentioned he did work with on the british tax system, obvious that he became pretty familiar with the tax law at some point in time. mr. pearlman: there is a private-sector story to be told there. in the early 30's of late 20's, there's a rise of an identifiable tax court. is a meaningful community of tax lawyers that starts developing in the 20's and 30's. mcgill is a leader in that. and there's also a recognition that lawyers and economists need to find a way to work together efficiently.

and so one of the more illuminating comments i've ever heard on this topic came from an economist who worked in the treasury department in the same years. he told me that the greatest regret he ever had was not going to law school. he seriously considered it, even while serving in the treasury department, he considered doing a night law school degree. they could see even then that the crucial decisions were going to be made by lawyers and accountants together. i do think there's a whole literature there among historians on professional expertise. this community of experts that grows up in the 30's and really sort of takes off into the 40's and 50's are this unusual blend of economists, lawyers, some accountants, and what i would call economically minded lawyers who end up dominating the process. mr. pearlman: thank you both very much. i thought they were very interesting papers. thank you. [applause]

>> this year marks the 90th anniversary of the joint committee on taxation. to look at the evolution of the committee and the tax legislator process over the past 50 years, the u.s. capital historical society brought together form a staff members and tax experts. nonpartisan, is and its professional staff of economists, accountants, attorneys assist members with all aspects of tax legislation. the next panel is about an hour. mr. pearlman: the second panel, as they are coming up, i will do my introduction. there are two papers involved here. and three people. in both papers deal with sort of the maturation of the staff and

the evolution of the staff. jim wechsler and randy weiss focus on, not the president, because there was economists and long-time members of the staff focus on the evolution of world economics and economists, i might add on the joint committee staff. and bob shapiro takes a picture of time, a fairly long picture, 50 years -- i didn't realize you were that old, bob. during which he was directly involved with the staff. it sort of looks at the evolution of the joint committee over that 50 year span. i think these two should be very interesting papers. jim and randy, i have constrained to, time was a bit. but we have a little more time, so if you towards a couple of extra minutes, that's fine. i understand, jim, you are going to go first area.

working on the history of economic analysis of the joint tax can be. the complete history would be too much. so we felt we were divided up into three what we call case studies, in particular situations where economic analysis done by the staff, in some cases, by others, was particularly important in the legislative process. the first case study, which i'm going to handle, is the tax reduction act of matches 75, which is an economic stimulus bill. is the capital cost recovery changes during 1980 through 1986. evolution ofthe revenue estimated during this whole span from the 70's to the present, which is basically the story of increasingly sophisticated economic analysis being applied to the revenue estimate process as that process begin ever more as a budget process involved. the 1975 act, and one of the purposes we are trying to

identify what exactly do economists do, and what are the conditions under which the members of congress want to pay attention to the economic analysis. the 75 act is important for two reasons. first of all, during my 11.5 years on the staff, this was the act where economics had the most impact on the legislative process. it's important for that reason. secondly, the macroeconomic policies of the 1970's have proven to be extreme the controversial. ofy were subject to a lot criticism. staggflation was coined. they referred to the fiscal policies of the 70's as a spectacular failure. it's worth looking into, because if mistakes were made, as the obvious they were, what exactly

were those mistakes? who said what to whom, what was right, was wrong? the 75 act is only one of five major tax bills in the 70's. but it is one piece of the puzzle. background, the economy entered a recession in late 1973. the economic activity declined all through 1974. in january of 1975, per limiter data on what was then gross national product is released, and it showed within the fourth quarter of 1974, gnp had declined an annual rate of nine per 1%. really a very serious decline. ford, who is taking office in august with president x and resigned initially focused on fighting inflation, which was still proceeding at double digits through 1974, despite the decline in economic activity. in january a vengeance of five, he shifted gears and in a state

of the union message to propose an economic stimulus plan. a simple plan, two parts. one was a refund of your 1974 taxes equal to 12% of your 1974 taxes, capped at $1000. scaling the numbers per capita, gdp has grown by a factor of seven cents/75. it is multiply all the numbers by seven to see what they would be in today's dollars, at least a $7,000 cap on the refund. the second part was an increase on the investment tax credits, from 7%, 4% for public utility's come to 12% for one year. committees swung into action also immediately. they got a lot of economic input. we look at three sources of economic input. one was the administration. the administration officials testified before both tax running committees -- tax-writing committees, so look

at the administration's economic positions as stated by their economists, you look at the economic report of the president, which was published in early february of 1975. second was a series of panel discussions, both committees help panel discussions trade the ways and means discussions were particularly significant, i thought. you had three full days of all-day panels consisting of a real who's who of economic policymakers from the kennedy administration, johnson, nixon administrations, officials from the fed, treasury, council of economic advisories, it was a real impressive bipartisan array of economists. these were not hearings where the witnesses were props for the members to make speeches at them. they were really engaged. they engage the panelist with detailed questioning, we were really sitting there, trying to learn. the third is joint committee staff briefing pamphlets. we prepared briefing tablets for

both the house and the senate. they were written in joint style, they really covered all the issues you want to look at if you were considering these proposals and possible alternatives. there's a lot of overlapping content between the two documents. but the senate report contained a little bit more detail on the economic forecast, and of course, more analysis of the house bill. the issuesthose, and dealt with our should there be a tax cut, if so, how large? how do you feel about the administration three b proposal compared to alternatives? it would be perceived by the taxpayers to be permanent. how you feel about the investment credit, how you feel about distribution, does that matter in terms of how much stimulus you are going to get? several things stand out about the economic analysis. first of all, it was all uniformly what today would be called old to kenzie and

economics, which is a way of analyzing things that's not really in vogue anymore in academia. committeest enjoy staff and administration were analyzing the situation in that paradigm. the coalition of all that work for these large-scale economic models, through four of which were in operation. one of the panelists was an economic forecaster who presented his forecast and simulations of what impact the tax code would have. there was 100% support for a tax cut at least as large as the administrations. some wanted to go bigger because they said it was a large gap between actual and potential outputs. this economy could, did a bigger tax cut. the economists were split on the rebate. administration was pretty confident that people would spend the rebates, others questioned whether people would spend a lump sum payment. the staffs conservation to this was in her briefing pamphlet.

we would do public opinion pollsters who it got out of the field and asked people will you spend your rebate. to twong like one half thirds of the people said they were either going to use the rebate to pay down debt or save it. but that meant that one third to one half are going to spend it. the advantage of the rebate of course was the came out quickly, provided fast acting stimulus, even though that was less paying for the buck. a discussion formulated a pretty well-defined questioned to the members to answer. supported thes itc. since a change in the economic historic position. my understanding was in 1962 when it was first enacted, did not have much support for itnomists who didn't think would provide much stimulus. in 1975, that had changed as result of research we cited the paper. support for the itc. detail howraces in the bill proceeded through the house and senate office.

increased the size of the tax cut by 50% over what the administration have proposed. on the question of rebate versus withholding, they split the baby , they scaled the rebate down directed to low income people, and use the remaining my dad tax cuts, which included some provisions that were important such as the genesis of the earned income tax credit and for a tax credit of $30 every personal exemption, multiply by seven. that eventually morphed into the child tax credit. they scaled down from 12%, used it for small business tax cuts which were not based on economic analysis. we evaluate economics. there were several things we got right, one important thing we got wrong. in terms of what we got rights, the economic forecast presented

by the macro economic forecaster mike evans, that was spot on. he said the economy was going to start recovering in the second quarter -- and 75. it hit bottom in march of 1974, month early. it recovered rapidly through 1975 and 1976 until the economy plateaued and tapered off a little bit in the second half of 1976 as the stimulus were off. rebate, there have been rebate since then, they have been much studied. my reading of the literature is pretty much confirms what those public opinion surveys said. that about two or three, one third to one half of the rebate gets spent, the rest get saved are used to pay down debt. the issue of do high income people are more likely to spend the rebate then low income people, my reading is status still inconclusive. the one big mistake we made was

the gap between actual and potential output. in the pamphlet, we estimated there was a 14% gap between actual and potential output in 1975. gdp date showed the economy declined 6% from its peak. we were assuming potential output was 4% per year. it gets you to 14% as sort of a back of the envelope way of getting there. up in therought panelist discussions. range anywhere from 10% to 20% gap, very large gap. turns out that was all wrong. today cbo does estimates. the potential output in 1975 was only 4%. it may be a little bit low, but we were off by at least a factor of two. there were three reasons for that. one was the tdp data was all

wrong. data was all wrong. 3% it only shows a decline in gdp. it was only half as severe as what was thought of at the time. gdp incline in the fourth quarter of 74, which galvanized congress into action so quickly, after revisions we were down 2%. secondly we greatly overestimated the rate of productivity growth. we were extrapolating the numbers from 50's and 60's. a reflectionre was point, productivity growth slowed. it accumulate as the years go by. errors.or two other the was an important mistake. today there is uncertainty about

whether there is a potential output and how large it is. a lot of criticism of fiscal policy in the 70's. my opinion, the members of congress wanted rapid recovery from the recession and a period of declining inflation. recovered nicely into 76. inlation came down rapidly 76. inflation was in double digits in 73 and 74, below 5%. -- and in 73 and 74, below 5%. >> hard to turn off his lawyers. >> thanks a lot. a special thanks to tom for

organizing this event and inviting us. jointd like to thank a committee economist for mom -- for all the information she gave us. let me go into the third case study. the second case studies about capital cost recovery, tax leasing, and it covers the period from 1980 to 86. this was a period where the rules were totally rewritten and the philosophy changed. appreciation was largely based on administrative decisions. by the end of the period it was based partly and largely on economic analysis. the staff economist played a key role in this transition. in 1980 the discussion of and thetion heated up

staff geared up to learn about the research that was available, key concepts like a active tax rates and economic depreciation and where depreciation and investment credits were expensive. administration proposed in 1981 the 10-5-3 proposal. they also proposed and enacted a new tax benefit transfer mechanism called safe harbor leasing, which allowed the user of equipment to transfer tax benefits without regard to economic substance that could use the benefits immediately. and they had proposed this because they realized the 10 53 was so generous that if they didn't have this mechanism, the benefits would just pile up and the users tax account wouldn't

have much effect. as the 81 act was in general very large, the revenue was an norm us, and members of congress realized almost immediately they had to cut taxes, they had to increase taxes, that the 81 act was much too big. they turned to the joint committee staff to help figure out how to raise taxes. of this effort was the 1980 two joint committee study at safe harbor release. staff economist contributed to that and found only about three quarters of the revenue loss went to the users. the revenue loss actually went to the buyers of the tax benefits, as well as intermediaries. this turned out to be a very inefficient way of transferring tax benefit. urge1982, as revenue

continued, the staff published a pamphlet. safe harbor releasing analysis, and it also and made feasible that some investments would be made economic even in the absence of an income tax. the options pamphlet says that a 50% basis for the credit, along that have been scheduled in 85 and 86 could make it too expensive. and it included all the staff recommendations. the repeal of the acceleration and the repeal of safe harbor release.

traced.n be really those changes can be traced to the staff economic analysis. another issue related to this was the issue of leasing equipment by tax entities. study thatorked on a focused on releasing, from the navy, support container ships. why did navy release ships -- navy lease ships rather than buy them? analyst of the navy believed by leasing they could eventually save money. because the private company could use the tax benefits and pass them to the navy. however analysis showed when you took account of the revenue loss lessorthe private

suffered, it was actually 12% higher than if the navy but the ships out right. -- nady bought the ships out right. that proposal was enacted with the administration's endorsement in 1984. early 1980's, and other staff economist project was comprehensive tax reform. tax reform, which would lower rates and scale back incentives. jim and i would work with senator bill bradley to craft -- bill.ey it would allow for a decline in value of property, but no investment incentives. as the discussion proceeded, the staff published a series of

pamphlets on the comprehensive tax reform proposal. in the early part of 1985, tax were subject of one of them or two of them. showed a 71% growth in losses between 1980 and 1983 that appeared on individual tax returns. mostly in the real estate industry. and even more significantly, staff economists devise a way to show how tax shelter losses affected is to be should of tax liability by income claim. that 56% of taxpayers in the highest income class claimed passive losses. which reduced liability by 16%. this analysis was key in designing the anti-tax shelter

provisions, the passive loss revision, and the rate reduction that was included in the 86 act. and finding that real estate was heavily involved in tax shelters led to the lengthening of depreciation life. recoveryal fund pamphlet employed all the tools available to characterize the incentive structure. and it came up with a way of using the existing adr lives and matching that with the available economic analysis, which showed what economic depreciation was, to basically allow a new system to be designed using the existing classification. area, the in this staff economic analysis played a big role in what happened. the revenueabout estimating.

story about new revenue estimating, and this is covering the period from the 1970's to the present, is that the staff continuously incorporated economic research into its successfullynd balanced pressures on methodology, which had been considered from time to time, with an overriding need to maintain the credibility of the rest and new -- of the revenue estimate in process. the traditional estimating framework had already been established. specifically the estimates majord the gdp and other economy wide aggregates were unaffected by tax legislation, but they already did behavioral changes due to relative price or microeconomic effects. for the size and direction of these behavioral changes, however, the staff wanted to rely on established research. goods not a lot of

empirical research in the public area. the interesting story is the 1978 consideration of k's. treasury was opposed. it purely static revenue estimate reflecting no change in realizations was the best way to produce the estimate. they took this position because they didn't believe the research was available on the effective capital gains tax realization's and was adequate to do an estimate. the members were very unhappy with this, because no one

believed there would not be a realization effect from cutting the capital gains tax. the joint committee followed the treasuries position at this point. members, however, didn't like that, and voted in the senate finance committee markup to include a feedback realization effect in the estimate. you look at the committee report and there are two numbers, the static estimate and the offset. it was constant, which was not consistent with the research that developed at that time. this was not a great situation for preserving the credibility of the estimate when members actually voted. staff went out of its way to avoid this in the future. be anl gains continued to

important subject for congressional consideration and became very controversial in 1990, when the staff estimate of a pending capital gains cut showed a small love -- a small revenue loss and the treasury showed a small revenue gain. breaking with tradition, the staff decided to publish a long pamphlet, showing the methodology it used. and this began and moved toward much greater transparency in the estimating process, reflecting a judgment that transparency would enhance the credibility of the process. since then there have been numerous pamphlets describing the methodology in the staff as published. estimate became more and more important during this period as well, because budget reconciliation really made them an important determinant and what the outcome was in the

legislative proposal. correspondingly, many started to question the traditional estimating methodology of aggregates and other should be held constant. the staff had a number of concerns about moving to dynamic scoring. a number of years for the staff to actually respond to this pressure. the first tangible response was and organized a staff modeling project. a variety of different models. it was a very large range for an

estimated economic impact. replacing the income tax for revenue generated a range of estimates from -4.2% change to 16.42%. it was such state-of-the-art that you couldn't get a very reliable estimates at that point. the staff decided to contract with one of the modelers to develop a structural growth model that incorporated a much tax sector,d because that was one of the feelings of the economic models that had participated in the symposium. as we know the tax system is very complex and those complexities the to be incorporated. that effort in 1997 led to the the equilibrium

growth model. the house rules have been amended several times to the use ofr require macroeconomic analysis. staffontinue to spur the to put resources in model development and analysis. in 2002 they organized another symposium. in 2003 they published the first kind of official macro analysis. published analyses for the big stimulus bill.

the macro analysis that the staff provided was an important input into shaping the proposal. finally in 2015, the staff actually produced dynamic estimates, revenue estimates affected in the latest house rule. the dynamic revenue loss estimate for the extension of the business tax revisions was about 11% less. the estimate for permanent extension depreciation was about 5% less. probably a lotre more modest than the proponents of dynamic scoring. up -- first of all

two things jump out. the staff economist are in a unique position because they can marry their analytic training as they are learning the details of the tax system. and that can't happen in very many other places. more importantly i think they can quantify things. while tax shelters mostly help can put is, they on these concepts. general numbers as

opposed to general statements, it can make an important effort. and they are familiar with and contribute to the latest research on taxes and their expertise is recognized. first and foremost their credibility. heard a lot about this staffight especially, the has a lot of credibility because their expertise, but also sticking to known frameworks, responding to interest, and a degree of transparency. just one more 32nd statement run. second statement run. -- such as a macro input use of 75 or the capital cost recovery use. they were drawn from existing

research. of course one budget rules make revenue estimates, a really important product to the staff, that really helps in terms of staff impact. finally it seems like the staff has a lot more impact when the congresses in revenue raising mode. congress does not lead a lot of help -- does not need a lot of help for tax cuts. but when they need to raise revenue the members really turn to the staff to help know what andlems need to be repaired how to increase revenue without causing a big economic impact. >> i apologize for putting time constraints on you. but i want to make sure has apple -- has ample time for his

presentation. talk about how the staff work has evolved over this 50 year period, from the time when he was a young member of the staff to the current time. >> as a former chief of staff the longested period to go, i'm thrilled to be here. i want to think the historical society for sponsoring and hosting this event, and also coordinating it and shaping the program and spending a lot of time with each of us. thank all of you. i was around here 50 years ago. i was a young puppet at that time, i was a law intern at the staff. it was 50 years ago. tom has asked me to talk about

what the joint committee was like 40 to 50 years ago, and the tax process as well as what evolved to make those changes. i would like to recognize what i call tax legends on capitol hill. it served the joint committee for 32 years and was chief of staff for 13. larry was an important and critical person to the entire joint committee process. his daughter is here today. we welcome her. a lot of us hatch amend his respect. the second one was a legislative council in the office who drafted the legislation. he is responsible for it. those two individuals are very

important. i have read all of the papers, they are very good. role ando focus on the responsibility joint committee in great detail, adding a lot to the historical literature of the joint committee, the legislative history and what it is doing in that regard. i devised the paper and presentation to three parts. and then how it is today, equally as important, what involved -- what is involved in those 50 years. i'm going to help you visualize this. let's see if i work this right. we will just try that one. here we go. tax-writing committees.

the tax-writing committees were chaired by two southern democrats, as were a number of other major committees. at that time the tax-writing committee and congress had a large middle, and therefore we ignored the extreme right and the extreme left. we were able to get tax policies that were done through the treasury and the congress. in addition the democrats had ways and means committee at the time were the committee of committees. and in regard to the senate finance committee, the senator had teed major committees and had a larger role in respective state. the joint committee had a major with regard to that process. the members of congress were small.

and ways and means only had a couple of tax people that did not get involved in policy. senate finance committee did not have staff at that point. one majority of the minority was the committee staff. and the minority staff to not come in the late -- do not come until the late 1970's. with regard to the other committees, on trade and health and social security, he did not have a large staff in those areas as well. the key item was they were nonpartisan. you heard a lot about that last night in the senate's representatives that spoke at the joint committee. were very highly specialized. as the laws became more joint committee had neither the specialties nor expertise to deal with it in that regard. didn't have any lobbyist in

those days. and they weren't involved until you had a tax -- going on. there were certain corporations. the tax bill when can mount but other than that you didn't have a significant large number of lobbyists. the news media, same result, he didn't have major tax bills, news media didn't have people working on it full-time. that when there were tax stories, they covered it. but they didn't have the expertise to cover it in detail as they did today. type taxthe special expertise did not exist back in the day. so that is a new phenomenon. let me talk about the legislative process. and the role of the joint committee in that process. we will get its light up so you can follow it. it is what i will call the

regular process. i'm pressing the button. >> it may work over here. >> there it is. i'm going to talk about it and the role of the joint committee. the hearings were extensive. they could be two or three weeks on the bill and the panels weren't put together. the joint committee staff prepared background pamphlets and they would be there to assist the technical expertise with regard to questions. a major change back then. they were closed to the public, the people allowed to them where the committee staffs, the joint committee, and the treasury that participated. in addition to the ways and means committee, they made conceptual decisions, tentative decisions for drafting purposes. sessions were maybe

four to six weeks. they needed a rollcall vote for the members and the producing states. the rest were just conceptual decisions. you had a house bill so they focused on the house bill. very rarely did you have votes. once again the joint committee staff provided pamphlets. when you get to legislative drafting, that is controlled by the house service in both the house and the senate. joint committee was there to participate as technical expertise, not for policy. the joint committee staff, the treasury, and the high-risk personnel were there in order to

help the equities in drafting it. had draftittee committee reports in the house and senate. often it would be given to the treasury. for a technical review only. the one distinction that was made earlier was in the house report. it was always your committee and the senate report. the first time i called it your committee. and it was correct and every time i did it in a sense. responsibility, individual area. in the beginning joint committee had two corporate, two individual, no computers. they did not needed as they were today. they went to the senate house for major changes as mostly a closed rule.

although it could be a modified will. therecommittee staff was and assisting questions other members had from a technical point of view. , major senate side difference because the bills were written by the middle in both house and senate. -- you very rarely had a filibuster in the senate. after you had floor action you went to the conference. the joint committee repair the document from the house and the senate. and then they reconcile the differences. reportu had a conference done by the legislative council office. all it was was the changes. the new development in 1969.

in effect what larry woodruff wanted to do was have a report of the final bill. varying degrees of acceptance of the blue book when it was taken in that regard. now let's look at the changes. open markup sessions. that made a major difference. much more different put in consensus to citizens it is open to the public. it made it a little more difficult. important, avery most year he was on the agenda. most corporations hired in-house of those people worked on the help. they understood the process and were very important to the process create in addition to that separate lobbying firms were brought in with several

built in separate issues, a full-time for the corporations. at the same time you had increased roles for the business group industry associations. those that didn't have in-house government relation lobbyists didn't have tax authorities -- didn't have tax expertise. same thing with the role of the media, more involved, more expertise. much more than i was in the past. tanks brought on tax expertise and the first tax expertise followed will was going on. -- followed what was going on. another major change was the makeup for the congress --

makeup of the congress for new members. they were able to get things done through the middle. as the congress changed, you had more of the congress go to the right or the left and therefore thedemocratic agenda was on liberal side, republican agenda caps on -- republican agenda was on the conservative side. the role of the chairman also changed. the chairman put together chairman mark's, and therefore try to work with committee staff, because they had more tax members on their committee staff. the joint committee provided the expertise and the committees had a chairman's mark, the became an in the future of tax legislative process. i made you need -- i may need

au to go over there for minute. the increased role of the -- i'm sorry, you have to go to the next one. committee became more of the expert. the index taxes to was one of the major changes. before that we used tax inflation. saying 4 million people, it is the same 4 million. we no longer had the money to deal with other changes.

they are supposed to tax spending cuts. the revenue bills had been neutral. as a result of that you had a growth of economic capabilities. an important role of the theomics estimating consulting firms, they had the expertise. then you had george bush, the famous line "read my lips, no new taxes. taxes." o new a lot of republicans felt they took a hit on that and became more hardened on taxes. the movement grover no quist -- grover norquist started, it

wouldn't raise taxes. anytime there was a potential tax increase. -- tax increase your let them of the pledge he side. -- flash they signed. tax increase he reminded them of the pledge they signed. the leadership has an important role as to whether the committee considers legislation, whether it comes to the floor, and that has been a major change and a role in leadership in the tax process in that regard. they ran ituch -- by the white house and administrative their bills.

case where thea policy comes to the white house, treasury may suggest the policy. the treasury is still a very important role but not as much in the final stage as it was in the early years. since 1986 the tax, we were the lowest tax rate, we are now the highest tax rate. the system with regard to the tax system becoming more complicated, everyone knows we need the tax reform. we haven't dealt with international taxes in the probe create way. we are not having any version of a territorial tax system. almost every member of congress and the administration believes we need tax reform. the problem is what tax reform. that has been a major issue for that.

let me summarize the role of today. today is not as it was before. the chairman's mark is a very important role in that. they were not able to bring into the floor at the time. that was a conflict between the administration, the congress, the house and senate, all believed they needed it. it was just difficult to do in that regard. although they clearly could have gotten a bill through the house, didn't want the members to vote i tax reform bill. some of those were hard foods. the second item there is the same traditional role with legislativee entire

process and their expertise, but not tax policy. tax policy was reserved for the committee staffs, the chairman, and some of the members. the chairman played a major role in the development, but the policy had more control in that regard. -- overall innce summary, the joint 20 plays annie major role in the entire tax process. players, are many more which have complicated it. but the joint committee's role is still a critical role in that process. >> thank you all. we have a few minutes for any questions or comments. schedule sotay on we won't have quite as much time. if anybody has a question, feel free. >> i have a question for randy,

you alluded to the fact in 1978, we didn't have behavioral effect for capital gains realizations. are you aware when that transition happened to? was it directly after the senate finance committee required the >> i don't remember exactly when that happened. act, which of the 86 changed capital gains rates, there was a lot of pay bureau realizations built into the estimates, including the big surge that happened. i don't never between 78 and 86 how that capability developed. >> you mentioned -- and i was

there at the time, so it is one of the things i particularly remember. that wasoned the work done in 1990, that was really quite significant. there was an estimating difference on capital gains between the treasury and the joint committee, which had not occurred previously. they said it was a lot of criticism of the staff and suggestions that the staff was being political. the staff didn't like capital gains and therefore was estimating revenue when they may not have been there. we made the decision to go public with methodology. it was understandable. they knew that no matter what was said publicly they would be criticized.

i think to the credit of the staff, published a really first-rate analysis of capital gains estimating process. it has been refined and updated since then, but it demonstrated the staff could go public with its methodology. >> i agree, that was the break with traditional stances. the staff had been very reluctant and still is to have complete transparency of the estimates, because the estimates are often done with not complete information. assumptions have to be made, hopefully the most reasonable ones. if all the assumptions are out , and the onestime

that are favorable -- the ones that are sort of mistakes but favorable to the outside interests, they will never get criticized. the ones unfavorable to the outside interests will get criticized. it is today's situation that argues against full transparency. i think it was very insightful and courageous to make that decision. in certain respects and certain cases in certain ways, not full details that were publishing the methodology could actually help diffuse concerns of politicization and -- >> it occurred to me well before ignore theou can't relationship between the joint committee staff and members, the

leadership of the tax-writing committees and members. having support from the chairman of ranking members for the , it isdence of the staff really significant. i remember that issue became a big item in the entries air force base summit, one of the ofe unpleasant experiences the deputy chief of staff. we were dragged out to the air force base and beat up by the members. capital gains was an important part of that. night the deputy secretary cited he was going to take on -- said -- deputy secretary decided

he was going to take on the joint committee, and he did. and here i was, a true staff trying to defend. said weer senator ben had a break. and during the break senator ben , chairman of the finance committee, came up to me and said, when we go back in there you let me talk. read he talked very forcefully in support of the independence and nonpartisan reputation of the staff. i think that was most helpful. independent, as long as it sponsors are willing to support that independence. >> in the old days the staff could take its spot and present economic analysis that was relatively uncontroversial.

nobody really disputes that, and we can pick our thoughts with revenue estimates. it's going to be an ongoing issue. >> my question follows up on the discussion and i'm curious for comments from many of you. he goes to the nonpartisan nature of the staff. congress is not -- there are losers in various congressional fights. is for losers, whoever they are, when they lose it is almost inevitable in my mind they are going to blame, to some extent, and potentially perceive bias for anybody not on their team, and all i need to do is what goes on typically in a sporting contest.

here we are not talking about reality. we are something talking about the natural perception of some people in congress, the losers of a particular fight, about bias and so forth. problem to me is that regardless of what the reality is, perception is critically for staff to be influential and affective. that immediately lowers the abilityor less is the -- or lessens the ability of the staff member to be going forward. i am curious how you see this issue. >> me tell you my experience from when i was there.

andmembers of congress house ways committee recognize the staff as independent and they are nonpartisan. they have certain constituencies that have certain positions and they lose on. statementstaff made a . i had a number of members who used to come to me privately and say, i'm sorry i beat up on you, but i had to. we made theey knew right decision, even though they didn't win in theirs. publicly they had to show their support for the constituency and the process created i only remember one case where a really madator was afterwards and it set of coming to me and thinking me for helping him, he was mad at the opposition. -- matt at the position. -- mad at the position.

this. going to cut we want to save time for the final panel. thank you very much. [applause] [captioning performed by the national captioning institute, which is responsible for its caption content and accuracy. visit ncicap.org] >> on the history buff. i love seeing how things are made. >> i love american history tv. >> it is something i really enjoy. >> it gives you that perspective. >> i'm a c-span fan. >> the 50th anniversary of the selma alabama marches that let the voting rights act of 1960

five, this becomes the house of representatives hosted a congressional gold medal ceremony to recognize the completion of the civil rights movement foot soldiers. here's a preview. >> my beloved brothers and sisters. leadership,ank the the house of representatives, and the senate, for making the ceremony possible. colleagues,thank my , -- for leading and paying tribute to the countless foot soldiers of the civil rights movement. it was their determination that led to the passage of the voting rights act of 1965. they weren't rich. or famous.

they had very little money. learned tom never read or write. but they changed the nation. -- they changed the nation for the better. today you and i are together here today. >> watch the entire program tonight at 7 p.m. eastern. this is american history tv, only on c-span3. years student cam document recovered vision was our largest yet. nearly 6000 middle and high school students took part alone or in teams of up to three. 2000 887 -- 2880 seven entries. notice time to award $1000 that -- to award $100,000 to our

winners. document whato issue they wanted the candidates to discuss during the 2016 presidential campaign. that thetold us economy, equality, education, and immigration were all top issues. we finalized for first-place winners, and when a 50 prizes in all. is one fan favorite selected by you. we are happy to announce our top prize winners. our grand prize winner is a 10th grader from oklahoma. her documentary addresses the federal debt. states is $18.5 trillion in debt. how exactly does america get up to its neck index? -- in debt?

>> large sons of federal money to three main areas. the first is discretionary spending, which received $1.1 trillion. -- next session is section is mandatory spending, which received $2.5 trillion. lastly there is the interest on the federal debt, which is $229 billion. olivia has earned $500,000 -- has earned $5,000 for her documentary. ner inrst prize win middle school is a sixth grader in blacksburg, virginia. their winning documentary is entitled what should be done about politics. this is the way that politicians try to get elected. politicians spend millions of dollars on their campaign.

as soon as one election ends the fundraising for the next begins. every day congress is in session there are fundraisers all over the country. in 2012 presidential elections cost two point $6 million. you can't help but wonder, where does all this money come from. $2.6 billion. you can't help but wonder where does all this money come from. >> they all attend choi high school enjoy michigan their documentary is entitled for 1% and it is about the scarcity of freshwater. >> today americans are drowning in overly debated issues such as immigration, medicare, terrorism, leaked e-mails. although these are important topics, the issue that affects most americans is the issue of the 1%. >> 1%. >> 1%. this 1%, the%, shining jewel of the united states, the great lakes.

>> the largest freshwater resource in the world. >> our student cam first prize greater -- art -- daniela mock-zubia and sofia taglienti. >> systems around the united states have changed radically in the last 2330 years. 20 -- last 2330 years. -- our state prison system the composition has also dramatically changed. >> the fan favorite was selected through your online voting. we are happy to announce the

anners, who receive additional $500, our first prize winners for high school east category. for montgomery blair high school in silver springs maryland. their documentary is entitled driving forward and tackles the topics of highway and bridge funding. >> america's love moving around. we love 70 mile-per-hour speed limits. we have more cars than any other country in the world. for all our love, we can to take what we drive on for granted. america is 2 million miles of roads and 600,000 bridges are aging, congested, and often dangerous. >> thanks to all of the students and teachers who competed and congratulations to all of our winners. the top 21 winning entries will start airing in april. all the winning entries are available for viewing online at

student cam.org. >> next on history bookshelf, jeremy schaap talks about his book >> the book has previously unknown interviews to dispel the 1936 berlin olympic games. the program was recorded in 2007, at the state university of new york at buffalo. bert: this is your npr station, wbfo during this is "meet the author," and i am bert gambini. we are at the theater at the buffalo campus, a program made possible by the division of the student affairs, and our cosponsor, buffalorising.com.

we would also like to welcome a crew from c-span3, here to video our visit. this is author, jeremy schaap with his new story, "triumph: the untold story of jesse owens and hitler's olympics." performance in 1936 represents one of the greatest achievements in sports history. it is also one of the great ironies that those achievements, are as much about refuting the national agenda as defeating opponents. all in an and environment, that was supposed to be devoid of prejudice. the germans carefully and their predice, with promises they had no intention of keeping. some did not want american athletes to be part of such an obvious nazi propaganda vehicle. owens did.

before the summer of 1936 was over, america's greatest hero, as famous as anyone in the country, single-handedly brushed the notion of not see superiority, and confronted racial prejudice at home. when exhausted and broke, he withdrew from the final leg of an exhibition tour. owens trained as an athlete, but the circumstances and stage pushed him in other directions. social and political. i am looking forward to exploring those directions and exploring this story tonight with our guest, the author of the new book, "triumph: the untold story of jesse owens and hitler's olympics." please join me now and welcoming me to wbfo and the university of buffalo, our "meet the author," guest, jeremy schaap. [applause] jeremy: thank you.