OpEdNews - Diary: New Mexico Republican Caught Lying to Congress

July 1, 2008 at 14:26:26 Permalink
New Mexico Republican Caught Lying to Congress

Diary Entry by Thurman Hart (about the author)

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Ed Tinsley has a solid record - of lying to Congress on behalf of the National Restaurant Association.

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The more you know about some people, the less there is to like. Ed Tinsley, who became a Republican to impress his fiance and can't quite remember where he lives, testified before Congress in 2004 about the evils of the IRS. In his recorded testimony, he either outright lies or shows a complete misunderstanding of dealing with large numbers.

Aggregate estimates inaccurately inflate an employer’s tax liability. In making these aggregate estimates, the IRS assumes – quite often, incorrectly -- that (1) customers who pay cash for their meals tip at exactly the same percent as customers who pay by credit card; (2) all tipped employees fail to report their tips; (3) all tipped employees fail to report the same amount; (4) customers never “stiff” their servers—i.e., leave them no tip.

Tinsley is talking about the IRS using "aggregate averaging" to determine the correct amount of tips that should be credited to an employee when figuring how much an employer should pay in Social Security contributions. What the IRS does is collect data from reported tips and uses basic statistical methods for extrapolating an average of total tips, reported and unreported.

The IRS does not assume anything that Tinsely says they do. Such assumptions are simply not necessary when dealing with exceptionally large numbers. Instead, the assumption is that all deviations will compensate for each other. The waitress that gets stiffed by the first customer of the day may well get an exceptionally large tip from another patron. Any difference between the tip levels of cash and credit customers will average out fairly equally. As the numbers increase, the more accurate these assumptions turn out to be.

With an elementary understanding of statistics, it is easy to see that the would-be Congressman is wrong. Either he knows he is wrong and is changing his facts to fit his argument - and his bottomline. Or he is simply ignorant of his own business - in which case he shouldn't be trusted with the people's business.

Thurman Hart says that the reason he writes is to show that "a Christian Liberal is not an oxymoron." He holds a Master's Degree in Political Science from the University of Central Florida and specializes in Public Policy (energy and taxation) and (more...)

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