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Trump's pick for budget chief answers questions about his tax lapse

Rep. Mick Mulvaney (R-S.C), President Trump's nominee to run the White House budget office, speaks at his Senate confirmation hearing in Washington. (Carolyn Kaster / Associated Press)
Rep. Mick Mulvaney (R-S.C), President Trump's nominee to run the White House budget office, speaks at his Senate confirmation hearing in Washington. (Carolyn Kaster / Associated Press)

Rep. Mick Mulvaney, picked to be President Trump's budget chief, came under expected fire for failing to pay more than $15,000 in taxes for his children's nanny, but it didn't appear that would torpedo his nomination, as has happened with past Cabinet selections.

At a Senate confirmation hearing Tuesday, most of the discussion instead focused on the South Carolina Republican's views on the nation's deficits and budget, particularly his past statements indicating the need to "end Medicare as we know it" and to fix Social Security, which Mulvaney at one time called a Ponzi scheme.

Bernie Sanders (I-Vt.), the budget committee's ranking Democratic member, described Mulvaney's remarks as "way out of touch" with the American public and Trump's own campaign promise to maintain federal retirement programs without cuts.

Sen. Debbie Stabenow (D-Mich.) said: “The alarm bells should be going off right now” for American seniors.

Mulvaney, a stalwart member of the tea party, said he was not advocating changes that would affect the benefits of current recipients, but for future beneficiaries. He did not budge, however, from his view that the nation's entitlement programs were unsustainable and needed to be overhauled. And if confirmed as director of the Office of Management and Budget, he told the committee that he would advise the president to make appropriate changes.

The exchange with Mulvaney foreshadowed what many regard as an inevitable clash between parties — and between Trump and congressional Republican leaders — in reconciling the nation's large and growing debt with the president's pledge to boost infrastructure investments, cut taxes and increase defense spending.

Mulvaney's personal tax problem was seen as a potentially major obstacle to his confirmation, but the hearing quickly moved to broader budgetary issues after Mulvaney acknowledged that he had made a mistake and explained what had happened.

Mulvaney, 49, said that he and his wife had hired a woman to help take care of their newborn triplets from 2000 to 2004. He said he did not consider her a household employee for whom his family had to pay taxes.

"In our minds, she was a babysitter. She did not live with us. She did not spend the night there," he told the Senate Budget Committee.

Mulvaney said it wasn't until he was selected to be Trump's director of the Office of Management and Budget, and given a questionnaire, that he realized that he should have paid taxes. He said he notified the Trump transition team as well as the Senate, and then paid more than $15,000 in federal taxes and fees.

Sanders, echoing an earlier comment by Senate Minority Leader Charles E. Schumer (D-N.Y.), insisted that the tax lapse was a "serious issue" and noted that similar cases had caused past Democratic nominees to withdraw. That list includes former Sen. Tom Daschle, President Obama's first pick for Secretary of the Department of Health and Human Services.

Committee Republicans came to Mulvaney's defense. Sen.Michael B. Enzi (R-Wyo.), chairman of the Senate Budget Committee, countered that some Democratic nominees, including Ron Brown for Commerce secretary under President Clinton, were confirmed despite failing to pay taxes for a domestic employee.

"I am pleased that President Trump has nominated a fiscal conservative for this key post,” Enzi said.

12:33: An earlier version of this story incorrectly identified Ron Brown as working in the Obama administration, rather than the Clinton administration.

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