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Stack was upset that §1706 did precisely what it was designed to do: Deprive him of the chance to exploit independent contractor status to avoid paying taxes through non-filing or through the understatement of income, overstatement of deductions, and avoidance of income tax withholding. In spite of the overwhelming advantages attendant to employee status, Joe Stack desperately wanted to be treated as an independent contractor for one simple reason: It would have made his tax protesting easier.4 Footnotes: ¹  We have met many taxpayers who worked as independent contractors for years without so much as a peep of protest until they realized, ex post facto, that it might have better for them to have been treated as employees. In our experience, workers tend to be content with their independent contractor status until one of the following happens: They get fired or quit They get hurt on the job They get sued for something they did while on the job They need a bank loan (and employment verification)  ²  If Stack had been an independent contractor and was subsequently “fired” by his principal, my hunch is it would have taken him less time to file a claim for unemployment compensation than it takes Apolo Ohno to finish short track. ³  Indeed, §1706 was included in TRA ‘86 because the CBO had estimated that the government was losing up to 30% of taxes because independent contractors were either not reporting all of their income on their tax returns or were claiming fraudulent or questionable deductions against that income. 4   Like all tax protestors, Stack knew that once the IRS had collected his taxes through payroll withholding it would never give it back to him based on previously refuted tax protestor arguments. Consequently, his only chance of avoiding taxes was to control his own tax payments and then use his frivolous arguments to evade or at least defer paying taxes.

No silver bullets. This is the simple premise of Diane Ravitch’s new book, “The Death and Life of the Great American School System,” which is being brought out this week by Basic Books. Written by one of our nation’s most respected scholars, it has been eagerly awaited. But it has also been, at least in some quarters, anticipated with a certain foreboding, because it was likely to debunk much of the conventional — and some not so conventional — wisdom surrounding education reform. Click Image to Enlarge

What of the once-great comprehensive high schools, institutions with history and in some cases a track record of success going back generations? As time moves on, it is fast becoming clear that the new small schools, many with inane themes (how about the School of Peace and Diversity?), can never substitute for a good neighborhood high school, which can become a center of communal life and pride. Ms. Ravitch’s report underscores the fact that the trick is to fix the neighborhood schools beset with problems, not destroy them.

It is not only the foundations that Ms. Ravitch blames for the current crisis: government has also failed in the attempt to reform the schools from above, lacking a clear perspective of how schools work on a day-to-day basis. Thus, the major federal initiative, No Child Left Behind, well intentioned as it may have been, ended up damaging the quality of education, not improving it. While the federal government declares schools as “failing” and prescribes sanctions for schools not meeting its goal of “annual yearly progress,” it is the states that are allowed to write and administer the tests. This has led to a culture of ever easier tests and more test preparation rather than real instruction. More ominously, it led to such scandals as the New York State Education Department lowering the “cut scores” that define the line between passing and failing. Ms. Ravitch suggests that the proper roles of the states and federal government have been reversed under NCLB. Maybe the standards for achievement should be set in Washington, which, after all, administers the National Assessment of Educational Progress , and the solutions found at the local level, using the accurate data provided by Washington. Instead of moving in a different direction from the failed NCLB model of the Bush Administration, the Obama administration has adopted and expanded on them.

Proponents of comprehensive regulatory reform hope for sweeping measures to protect consumers from predatory lending, rein in high-stakes Wall Street trading in arcane derivatives, boost capital requirements for banks that want to bet big with depositors' money and spread some regulatory sunshine on the dark pools of the “shadow banking system” that caught regulators flat-footed when the market spiraled into the abyss in the fall of 2008. “We cannot afford to let the status quo continue,” Sheila Bair, head of the Federal Deposit Insurance Corp., told a meeting of business economists in Washington. The final law is still in doubt. Sen. Christopher Dodd, D-Conn., has pressed for reform during a year of intensely partisan bickering. On Friday, Dodd — a lame duck who announced his retirement after disclosures that he accepted favorable terms from subprime lender Countrywide Financial — claimed that the Senate Banking Committee he chairs was “days away” from wrapping up a bill. Any resolution faces a major political hurdle that has drawn the most public attention: a proposal to create a new agency to protect consumers from predatory lending and other abusive financial practices. While the "systemic risks" to the financial system may represent a bigger threat in dollar terms, voters might be more focused on the consumer impact.Dodd said that’s not hard to understand.“The subject matter of derivatives and swaps and the issue of systemic risk and too-big-to- fail seem somewhat removed from the general public,” he told CNBC after the Senate compromise was reached. “Watching my credit card go to 32 percent rates and huge fees, watching prepayment penalties on mortgages, these are things that millions of people understand.”