Attorneys, assists members with all aspects of tax legislation. This panel is about 45 minutes. So our first panel is going to examine portions of the history of the joint committee on taxation. And our first speaker is george yin and his paper deals with the joint committees role in the codification of the tax laws. George . Thank you very much, and thanks to the u. S. Capital and Historical Society for sponsoring the event and to the joint committee, tom and the rest of the staff per organizing it and inviting me to participate. Its wonderful to see so many familiar faces and join in celebrating the 90th anniversary of this great institution. I thought i would use my time to mention just a few of the surprises i have discovered in researching the history of the joint committee. Truth be told, virtually everything ive learned has been very interesting, if not surprising. In addition to satisfying our 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 are the legislative and executive branches, the house and senate, and the Political Parties. It is the first, and i believe the only, legislative Committee Staff to ever be so situated. In that sense, those of you who now serve or have served on the jct staff have been part of a grand experiment, and i hope to explore some of the implications in my broader research. Although for reasons that bob shapiro will relate to us shortly, the legislative environment has changed dramatically over the years. We may nevertheless find constructive some of the experiences of the early staffs. Beyond the first years of the staff, the Research Task is more difficult. For my paper today, i was helped that Key Developments took place in the remember is of 1927, when congress was out of session, ways and means and the first chairman was in iowa and the small staff was in d. C. As a result, some important issues 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 importance is very hard to determine. The paper trail gets harder as the size of the staff grows, and some information, of course, is not memorialized at all. An additional difficulty, unless Joe Thorndike has worked something out, is that the staff papers on the nixon investigation are off limits until 2024. And i was told that they may not be cleansed of tax return information and available to the public until 2029 at the earliest. Ive always been pretty good at arithmetic and i can tell you that although joe may be here to tell you that part of the story, in the 115th anniversary, i will not. Probably my Biggest Surprise was the completely unintended nature of the institution congress authorized in 1966. The house wanted to create a twoyear tax commission, Something Like the Tax Reform Panel established over a decade ago by the bush administration. In the early years, chairman green continued to refer to and treat the committee as a shortterm institution, even though the enabling statute placed no time limit on its existence. All of his initial hires were temporary. And he even expressed caution about a promising applicant giving up a good permanent position at the Treasury Department to take what he 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 greens election as the first chairman rather than senator smoot. I was also surprised by the connection between the depletion allowance and the joint committee. My article on the origins of the jct, i describe how the finance committee in 1918, with no professional Staff Support in the legislature, was totally snookered by a maritime lawyer into approving, over the objections of the treasury, the discovery depletion allowance, the forerunner of percentage depletion. The lawyer was working for an emergency federal energy agency, but he had little background in energy or tax. Theres a wonderful scene in the pertinent hearing where the lawyer is shown the oil and gas industrys proposal, and he turns his nose up at it. Inadequate, he sniffs. They get word to the senators that theyre fully on board. Unfortunately, aside from being too generous, the provision is also impossible to administer. A concern that the maritime lawyer dismissed at the hearing. And those problems led to difficulties at the tax agency, a congressional investigation, and eventually creation of the joint committee. The first chief of staff, lovel parker, was a Natural Resource valuation engineer, whose skills became somewhat obsolete once percentage depletion was approved in 1926. Im not sure whether chairman green understood that when he hired parker in that year. Discovery depletion however, was still permissible for mine property and parker wrote several early studies comparing the two provisions and exploring ways that some might be feasible. Some of you know that theres actually another very interesting connection between depletion and the joint committee. As herb shafit told me a few years ago, during the mid 1950s, following one of a number of failed attempts to cut back on the depletion allowance, a joint Committee Staffer said despondently, that there would be a man on the moon before congress would ever do anything about it. Sure enough, on july 21st, 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. [ laughter ] another interesting, if not surprising matter was to learn about the pretax code world, something i am confident to say no one here has ever experienced first hand. In 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 precode world was like. One way to conceptualize congresss problem is to consider the voluminous footnote work. If there werent a code, how that would be preserved . One possibility which congress followed through 1926 was to repeal all prior enactments, but to incorporate any still prior applicable law ruled into the text of the current enactment. This meant that the current enactment generally contained all of the law. But just imagine how unwieldy some of those provisions became if a rule was frequently changed. Consider for example incorporating into the text of current section 168, all of the rules now included in that sections 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 enactment to be fairly clean. But it meant that anyone interested in the prior law rule had to locate the applicable statute and make sure, of course, that it still represented good law. As the number of enactments proliferated, the Research Task became increasingly challenging. And of course without a code as positive law, amendments had to be made to the prior statutes and not to the code. We would all have to hope that codifiers could quickly incorporate the amendment into at least a prima fascia 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, ive not found any economic analyses in the early files, but i have found some early revenue estimates. Im sure they would provide a good laugh to jim wets ler, randy weiss, and the economists on the staff. The connections between roswell, mcgill, colin stan, who was the longest serving joint Committee Staff by far, and the joint committee were all unexpected. Mcgill was indisputable one of the most important tax officials of the 1930s. But i had no idea how involved he was in the joint committees story. 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. And had the accepted either opportunity, his 37year on the staff might never have happened. A professional connection occurred in early 1938, when as undersecretary of the treasury, mcgill requested and obtained from stan, 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 staffs codification efforts that were at 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. I found this entire episode very curious. As i indicate in the paper, the explanation may have been the influence of herman olfont, who was a senior colleague of mcgills at columbia, senior treasury counsel in 1939 and opposed to codification. The main takeaway was congresss willingness to move ahead with this technical piece of legislation, notwithstanding treasurys ambivalence. Given congresss Prior Experience with codification 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 staffs reputation in the legislature. Finally, ive accumulated much information about colin stan who appears to have been a fairly controversial fellow. In 1963, for example, ned ken worthy, d. C. Correspondent for the New York Times wrote a lengthy professional about stan. And 19 of the 20 persons interviewed, senator harry bird being the lone exception, insisted upon anonymity so that they could speak candidly. During this period, stories began to appear in the press about how stan was a conservative who was too sympathetic to business interests. Since some people on the outside, jeff burn balm being a notable exception, do not understand very well the nature of the chief of staffs job, i plan to take a close look at these claims. Stan was clearly no shrinking violet. He was once confronted in a markup by a Senate Liberal who asked him which state he represented. Reportedly stam responded without blinking an eye, the united states. He was a real stickler for endorsing policies against gifts or other private benefits. On one occasion a lobbyist advised that he was forwarding a ham to the staff. Because this gift was perishable, stam tried hard to prevent its delivery, sending a series of increasingly desperate telegrams to the effect, dont send that ham. Last, i plan to examine the famous episode involving stanley suris confirmation to be assistant secretary in 1961. The committee krild him in part because of a controversial article he had written a few years earlier on the tax legislative process. Some believe that suris treatment was partly attributable to disagreements he had had with stam in the legislative process. Thank you all very much for your kind attention. [ applause ] okay, ron has very generously said we have a couple of minutes. So i just want to show you a few pictures here that ive so this picture here is the person on the left is roswell mcgill. The person on the right is lovel park, the first chief of staff. They had collaborated on a small book in 1935, on the british tax system. And although this picture is not dated, im assuming that this was put together as part of the publicity for that publication. What i find particularly interesting, if you look at the background of the picture, it does appear to be a Typical OfficeBuilding Office that theyre sitting in. Just for your information, the staffs first offices in 1926 were in a partitioned area of the cannon dining room. That was one choice. The other choice was a Basement Office in the capitocapitol. And the staff and the chairman thought the partitioned office was at least a little more in the flow, if you will. The building that we now know of as longworth 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 firstfloor office in 1946 and i believe they got 1015, the longknown front office if you will, in 1970 or 71. This picture here is at the time of parkers resignation in 1938. And here you see him shaking hands with senator harrison, the chairman of the joint committee at the time. Both wearing your spiffy white outfits for a june day in december. Im sorry. A june day in 1938. And heres a picture of parker standing up and thats stam who has already been selected to succeed him. And finally, this is a picture which i mentioned in the paper, this, as ive been told, is something that somebody on the staff actually drew. I dont know how well you can see it, but the person in the middle here, who is kind of running or fleeing the persons in the upper righthand corner, is stam, and hes holding a young child known as the code. This is, to me, a play on the orpheus story where orpheus is saving his wife and hades and out of the never world and bringing her back to the upper world. And on the upper righthand corner, the person who is kind of menacing is the bureau of Internal Revenue chief counsel wenchel and i dont know if you can see it, but in the far righthand corner, there appears to be a dog with three heads, which would be and it says the treasury hounds of ignorance, envy and delay. So those are what hes fleeing. The stones are named after people involved in the legislative process. The lower lefthand corner shows absolute law and that was obviously the big effort was to make this code absolute law. Thats all ive got. Thank you. [ applause ] so now were going to skip a few years and Joe Thorndike is going to talk with us a bit about the joint Committee Involvement with the nixon tax returns. What do i have to do to get my oh, power points moving back. Well, ill just start by saying there we go. George has much better visuals than i have. A apologize for that up front. I have found over the years that if youre talking about tax to nontax audience, or history to just about anybody, the visual aids are crucial to keep people focused. In this room its probably a little bit easier, i can take theres a presumption of interest going in. I will say, as george said, researching tax can be difficult, any tax issue, if it depends on government documents, because the National Archives, quite understandably, i think, is very skittish about releasing inadvertently taxpayer information. They have released it to me in the past and they get in trouble for that. But it really does mean that theres sort of a curtain that just drops down on a lot of tax issues that makes them very hard to research. Because it is actually just impossible for the archives to try to vet their files for tax preparer information when theyre not in a position to know what constitutes taxpayer information. But here we have a topic that is really all about taxpayer information. The difference being that it was made public, or at least a great deal of it. Still, you cant, as george said, research the committees records for their investigation of the nixon tax returns. Which means that what i had to end up doing here was really and im still doing it, its a work in progress is sort of researching around the investigation. And we have the results, the committees report, but to know exactly what happened and to answer all the questions, you have to sort of look around that report and come up with what you can. It is not particularly reliable way of researching historical topic. For instance, it was pointed out to me this morning, that one of the points i make in the paper is that after all was said and done and nixons deficiencies in his tax returns had been identified, that he agreed to pay the figure that the irs had identified. And actually that may or may not be true. And actually i cant think of any way that i can verify whether or not he actually paid, but thats a typical example of the problem. In any case, what ive tried to do is not just look at the investigation itself, which is, to the extent that its a published report thats available, but just also to look at the effectiveness investigation on institutes around it, particularly on the irs, or more broadly, on an institution like the tax system, the presidency, or even american politics, because i think thats where we can actually see the importance. All right, so this is my title for this presentation is what nixon told an interviewer several years after he resigned the presidency. And he had reason to note, make sure you pay your taxes because you can get in trouble for it. He did get in quite a bit of trouble for it. So this began, the whole controversy over nixons tax returns began in the summer of 1973. It really didnt end until he resigned. It was it has been obscured in popular memory by the lurid allegations and deeds of the watergate breakin. But at the time, it was considered very serious and an existential threat to the presidency. Even before the watergate breakin became a big deal. And the joint committees chairman was known for Walking Around before, during, after the investigation and saying, i think this is going to cost the president his job. He believed it. The effect of this controversy was really that, i think its principal effect was that eroded faith in government. Along with watergate, this is what did in the nixon administration. But i think theres a bright spot here and its the joint committees investiga