KEN STREMSKY DISCUSSES TAX EVASION AND OTHER TOPICS THE ART OF WAR BY SUN TZU Page 84 of the Art of War by Sun Tzu translated by General Samuel B. Griffith says "To put a rein on an able general while at the same time asking him to suppress a cunning enemy is like tying up the Black Hound of Han and then ordering him to catch elusive hares. What is the difference? 30. It is in these five matters that the way to victory is known. 31. Therefore I say: 'Know the enemy and know yourself; in a hundred battles you will never be in peril. 32. When you are ignorant of the enemy but know yourself, your chances of winning or losing are equal. 33. If ignorant both of your enemy and of yourself, you are certain in every battle to be in peril.' Li Ch'uan: Such people are called 'mad bandits'. What can they expect if not defeat?" The ISBN is 0-19-501540-1. TAX EVASION AND THE INTERNAL REVENUE SERVICE David Cay Johnston in the March 26, 2002 New York Times on pages A1 and C2 has an article with the title "I.R.S. Says Offshore Tax Evasion Is Widespread." I have no problem with Americans avoiding the paying of taxes via ethical, legal means. I do have a major problem with tax evasion. Tax evasion jeopardizes our national defense, ability to fight terrorists, Social Security system, Medicare system, and other social safety nets as well as research capabilities. The website of the Internal Revenue Service which is www.irs.gov says the Internal Revenue Service "supports operations of the Federal Government by collecting more than $1.8 trillion in taxes each year. The Internal Revenue Service is the largest agency in the Department of the Treasury with about 98,000 employees and a budget of $8.2 billion." Internal Revenue Services Commissioner Charles O. Rossotti has a very informative document on the Internal Revenue Service website which is "Modernizing America's Tax Agency." Congress should make sure the budget of the Internal Revenue Service is at least $20 billion a year, at least quadrupling (which means multiply by four) the budget for tax enforcement, and make sure the Internal Revenue Service has at least 150,000 employees. Internal Revenue Service employees should be exempted from standard federal pay scales. Manhattan should have at least 300 tax auditors. Congress may want to increase the punishment for failing to disclose offshore holdings from five years in prison to 10 years in prison. Congress may want to require MasterCard, Visa, and other credit card companies to know the names of their customers. Congress may want to require American Express, Mastercard, Visa, and other credit card companies to hand over the names and credit card information of people that the Internal Revenue Service asks for information about and not allow the credit card companies to tell people they are being investigated. TAX AVOIDANCE BY BUSINESSES David Cay Johnston's article "Tax Treaties With Small Nations Turn Into a New Shield for Profits" on pages A1 and C2 of the April 16, 2002 New York Times discusses tax avoidance. Robert S. McIntyre's "Putting profits of patriotism" article on The American Prospect's website which is www.prospect.org says what we should do about the situation. I hope businesses will decide to be patriotic by stopping to use this unethical scheme to avoid paying taxes. Businesses would not have made as much money in the United States of America if the United States had not had a strong national defense and strong social safety nets. SECURITIES AND EXCHANGE COMMISSION I decided to write this section after reading "Mounting workload puts SEC under the gun: Officials see agency as 'increasingly strained'" written by Noelle Knox and Gary Strauss in the May 9, 2002 USA Today on pages B1 and B2. The Securities and Exchange Commission's yearly budget should be at least two billion dollars a year. The corporate finance division of the Securities and Exchange Commission should have at least 1,340 employees. The SEC's enforcement division should have at least 3,000 employees. SEC attorneys and accountants should be exempted from standard federal pay scales like attorneys for the Federal Reserve are. SEC attorneys and accountants should be paid at least as much as attorneys and accountants are paid by the Federal Reserve. I do believe there is a conflict of interest in accounting firms that offer both auditing and consulting to their clients. I believe Congress should pass a law that says accounting firms may provide either accounting services or consulting services to a client and they may not provide both accounting services and consulting services to a client. The staff of the Chief Accountant of the Securities and Exchange Commission should be at least 100.