Noted cowboy philosopher, musician, author and sometime gubernatorial hopeful, Kinky Friedman, recently voiced his rather definite opinion on the government’s ability to run things.
Friedman said in his best Texas twang that he didn’t have much use for an outfit that could run a legal brothel into the ground. His reference was to Uncle Sam taking over one of Nevada’s infamous “ranches” after it was slapped with a series of tax liens.
I mention the Nevada brothel vignette, because now there is an effort to resurrect the movement to end the IRS’ private debt collection service.
As the Obama administration prepares its transition, leaders of the House Ways and Means Committee have begun urging him to stop the practice, which since its inception, has drawn more than its share of controversy.
Oversight Subcommittee Chairman John Lewis, D-Ga., and Ways and Means Chair Charles Rangel (there’s got to be a joke in here somewhere) have written to President-elect Obama requesting that he put a stop to collection outsourcing.
The IRS currently is under contract to a pair of debt recovery companies — Pioneer Credit Recovery and CBE Group — whom opponents of the program say cost far more than if the IRS kept debt recovery in house and they claim that tax collection is a government function and trained agents are more efficient .
This is the part that begins to scare me, for cost and efficiency are not nouns synonymous with anything government run.
In 2007 Ways and Means conducted an investigation into the private debt collection program and said that their services often subjected taxpayers to undue harassment. Additionally, the IRS projected that the private outsourcing program would fetch roughly $65 million, but ultimately wound up with about half of that, with one-third of the proceeds going to the companies themselves.
The service is currently mulling whether to renew the existing contracts — which expire in March — for another year.
Sadly, while opponents may have a point about collection outsourcing, there’s little evidence that in-house forces would be able to marshal noticeably greater revenues, while there’s far more historical precedent regarding Uncle Sam’s shaky resume in running anything and blatant lack of success thereof.
Perhaps we can convince Kinky Friedman to take a stab at it.
Register or login for access to this item and much more
All Accounting Today content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access