[edited 1/27 primarily for typos and links]
The Obama administration has named Mark Ernst, who was the CEO of H&R Block, as a deputy commissioner of the IRS. Ernst is going to oversee operations support, according to the IRS memo. But Ernst was replaced at H&R Block in 2007 after a spate of bad news about the company, including the following: (i) the company had five quarters of losses from subprime loans; (ii) the company revised its earnings (in 2006, for several prior years) because it had underpaid state taxes by about $32 million; and (iii) the company paid $62.5 million in a class-action settlement for charging ridiculously high interest rates on IRS refund-anticipation loans. See Ryan Donmoyer on Bloomberg.com. Option One, a subsidiary of H&R Block, was the eighth-biggest U.S. subprime lender in 2006, says Donovan (citing to the trade journal, Inside Mortgage Finance), and was closed after Ernst left the company.
Hmmmm. I know that some "insiders" are needed because of the vast storehouse of information they provide. But I'd like to see more fresh air in the personnel who will be dealing with this financial crisis than we've seen so far. Geithner--Federal Reserve Bank of New York and not-so-good at taking care of his own taxes; Summers--Clinton-era tax person and too much of a neo-liberal believer in the market back then to have the fresh ideas that one would like to see now; and now Ernst--certainly at best a middle-of-the roader and, as one in charge when subprime mortgages were booming at H&R Block, also one in the thick of the speculative frenzy rather than the prudent, systemic consideration.
Where are the people who understand the need to revamp the financial stystem regulation to ensure that we don't let banks get too big to fail? Not in that list of three, I think.
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