- The Washington Times - Thursday, September 14, 2000

Venus Williams had some fairly pointed questions for President Clinton when he called to congratulate her for winning tennis' prestigious U.S. Open and an $800,000 victory check this past weekend. After making small talk about the president's doings at a U.N. summit, she matched him stroke for stroke on public policy of no small importance to her.
"Can you lower my taxes, please?" she asked him. Mr. Clinton tried to laugh off the question. Not to be put off so easily, she asked again, "So, what can you do about it?"
"Not much right now," Mr. Clinton said, trying to string her along. "I think there ought to be new rules for athletes."
"Should I read your lips?" she responded.
Game, set, match, Miss Williams. Evidently it was not the first time she and her sister, Serena, had worried about trying to hold onto the rewards of their labors. After Serena won the Open in 1999, Venus reminded her that she, Serena, had an estimated tax payment to make soon. "I guess Uncle Sam is really happy," Serena answered.
At about the same time of the Williams-Clinton exchange, by coincidence, Erin Brockovich, the subject of a movie starring Julia Roberts, happened to have taxes on her mind as well. Ms. Brockovich had received a $2 million check in connection with her much-publicized campaign to protect a town's water supply from a local utility that had supposedly contaminated it. But she didn't actually get to keep the $2 million.
"I did get $2 million," Ms. Brockovich told an audience in Pittsburgh. "The IRS took $1.1 million … It's a shock, isn't it?" Ms. Brockovich explained that she wished she had had better knowledge of tax loopholes.
One can just imagine her approaching government officials, saying that she was one of the "good guys" who had exposed corporate wrongdoing. How could an environmentally friendly administration like Mr. Clinton's do this to one of their own?
Quite easily it turns out. No opponent not public utilities, not the rest of the female tennis circuit is nearly as formidable and relentless as the IRS.
In fairness to the agency, its authority to strip Americans of hard-earned gains comes from congressional lawmakers and the president. In many cases (well-documented accounts of agency harassment notwithstanding), the IRS plays the heavy simply for carrying out the wishes of elected officials. Politicians find the agency a convenient means to distance themselves from the responsibility for high tax burdens. Miss Williams' serve-and-volley with the president shows she understands how the political game is played too.
Mr. Clinton's answers to her questions are perhaps unintentionally revealing. When Republican lawmakers ask him for a tax cut, he invariably demurs, saying their plan would favor the nameless, faceless and presumably undeserving "rich." He carefully did not resort to such an argument with Williams for the obvious reason that no one who has seen her grace and prowess on the tennis court could say she didn't deserve every penny of this paycheck and those of paychecks to come.
Instead Mr. Clinton lobbed up a familiar argument for targeted tax cuts, in this case, for athletes. Why athletes should benefit from special rules he didn't say. Think of it as the usual Beltway tax racket: Who actually benefits from the racket matters less than the fact that it remains firmly in the grasp of Washington, whose source of power depends on being able to pick the winners and losers in any public policy contest.
In the case of Miss Williams, the practical effect of her taxes is to punish her for all her hard work, all those hours she spent on the court, practicing to live the dream of a champion. For her efforts, she gets to give up roughly 40 percent of her prize to federal income taxes, still more if she has to pay a state income tax, and an additional 15 percent for Social Security taxes. At her death (not anytime soon, one would hope), she could face a death tax ranging from 37 percent to 55 percent on any amount over $1 million (as of 2006).
She certainly has the financial means to hire competent accountants and lawyers to reduce her tax bill as much as possible. But the cost of such planning is simply taxation by another name. Any other American dreamer faces the same obstacles.
The tax penalty Venus Williams now faces is emblematic of the problem facing other high achievers in this country. As such it has a place in the current political campaigns. Vice President Gore has staked out his position on the side of those resisting across-the-board tax cuts, saying they are skewed to favor the "rich." His opponent in the presidential race, Texas Gov. George W. Bush, should give him every opportunity to explain why he favors maintaining the "Venus Williams tax." Voters should be sure to read Mr. Gore's lips as he answers.

E-mail:smithk@twtmail.com

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