If You Ask Me: A Global Banker Reflects on Our Times

Wriston, Walter B.


The Injustice of Our Tax System


You and Bill Simon[3]  and others have been talking about a clean, simple tax system with no gimmicks. Do you think, Walt, it has any chance of getting anywhere?

I think we have a chance. More important, we to have a chance, because the whole system will break down, if we don't do something radical. Just consider, there are forty thousand pages in the IRS manual of procedure-- forty thousand'. There's not an accountant, not a lawyer, not a Congressman who understands them all. So, there's no cop who can read you your rights.

The result is chaos. But we put up with it because every special interest group in the country gets a subsidy.

The biggest subsidy goes to the guy who lives in a suburban house. There's a six billion dollar tax deduction for interest on mortgages. Those of us who live in apartments feel that is not equitable. My proposition is that you throw away the whole damn thing and start from scratch. You put in a simple graduated income tax with a fairly low ceiling and it would raise more revenue than we raise with the Rube Goldberg contraption we've got now.

Do you realize there are 107 people in this country who make over a million dollars and pay no taxes? That's the law. When the injustice of that gets around, and it is, there's no question in my mind that we are going to have a change.

I was with twenty-five businessmen the other day, and we were meeting with a very distinguished congressman. They egged me on to push my proposition, and he looked at me and said, "It's politically impossible." Every other person in the room disagreed. We think it's something that can be done because it to be done.

When the American people perceive the total injustice of a blue collar worker paying more taxes than a millionaire, or realize there are unequal taxes on equal salaries, I think there's a chance of generating enough political steam to do something about it.

The problem is that you and I like to be subsidized. I think, for example, the deduction that banks get for bad debts is one of the finest ideas in the history of the world. That's my loophole. But, of course, your loophole is very unjust.

That's the problem. Talk to the universities and the hospitals. They have such faith in the American people that they are sure nobody would give them any money, if it wasn't a tax deduction. That just isn't so. The greatest period for charitable giving in American history occurred before the income tax. A Carnegie Library on the corner in every town in the Midwest testifies to that.

I submit that if you and I could keep 80 percent of our earnings, we'd be delighted to continue supporting the universities, the hospitals and other charitable foundations.

Instead, there's a spirit abroad in the land now that says all the money you make belongs to the government and anything you keep is a loophole. That's the way it is.


[3] William E. Simon, business executive and former Secretary of the Treasury.

  • The document was created from a compilation of interviews and question and answer segments with Walter B. Wriston which was later compiled into "If You Ask Me: A Global Banker Reflects on Our Times" in 1980. The original speech is located in MS134.001.034.00018.
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 Title Page
If You Ask Me: A Global Banker Reflects on Our Times
I: Getting Down to Fundamentals
The Big Cop-out
You Can't Go Bail for Everyone
Risk Is What It's All About
II: Some Basic Ills of the Body Politic
Lincoln Wouldn't Have Made It
Unpredictable Is a Dangerous Country
The Pitfalls of Single-issue Politics
Expect To Get Zapped
The Perils of Legal Pollution
The Injustice of Our Tax System
Those Wonderful People Who Bring You Inflation
Stop the Presses
Silly Premises Lead to Nutty Conclusions
Easier Said Than Done
III: New York, New York
New York City Is Alive And Well
The Road Back
IV: Careers
Rx for Happiness
Good Forward Planning
Dull Job?
A Simple Matter of Survival
Making It at Citibank
What Fast Track?
No Hiding Place
V: Once Around the World Quickly
South Africa
China: A Matter of Timing
The Real Significance of Iran
Iran and the Money Markets
Fashions in Country-criticizing
VI: The Global Financial Scene
The Elusive Eurodollar
De Facto Payments Mechanism
Too Big To Move
The Foreign Exchange Game
They Can't Leave the System
Baskets of Money
Swiss Francs
The Value of a Dollar
Not a Loss Since 1897
A Rational View of LDC Loans
Free Trade Benefits Consumers
The Destructive Costs of Regulation
The Big Rip-off
A Real Entitlement
Can Regulations Prevent Bum Loans?
The Insidious Side of Controls
Competition in Regulation
VIII: The Shape of Things To Come
Not As Big As You Think
What Lobby?
Armageddon Is Late, as Usual
Some Simple Facts about Interest Rates
An Expensive Luxury
How Big Is Big?
What We Did Yesterday Won't Work Tomorrow
A Matter of Semantics
Unpredictable Is a Dangerous Country
Privacy: A Serious Problem
The Unseen Revolution
Things Are Going To Be Different
Take the Handcuffs off Everybody
The Gray Areas of Lending
No Mouse under the Rug
Thank God We Don't Have National Banking
Competition Keeps You Awake
Accounting for Loan Losses
Not a Utility
People Like It
Computer Frauds
Some Final Words on Responsibility
About the Author