1 00:00:03,480 --> 00:00:07,560 Speaker 1: Welcome to the Bloomberg Law Podcast. I'm June Grosso. Every 2 00:00:07,640 --> 00:00:10,440 Speaker 1: day we bring you insight and analysis into the most 3 00:00:10,480 --> 00:00:13,399 Speaker 1: important legal news of the day. You can find more 4 00:00:13,480 --> 00:00:18,040 Speaker 1: episodes of the Bloomberg Law Podcast on Apple Podcasts, SoundCloud, 5 00:00:18,320 --> 00:00:23,200 Speaker 1: and on Bloomberg dot com slash podcasts. Today, Kathy Cranninger, 6 00:00:23,400 --> 00:00:26,160 Speaker 1: President Trump's pick to replace Mick Mulvaney at the head 7 00:00:26,200 --> 00:00:30,480 Speaker 1: of the CFPB, faced a Senate Banking Committee to defend 8 00:00:30,520 --> 00:00:34,800 Speaker 1: her qualifications to run a controversial agency that many Republicans 9 00:00:35,000 --> 00:00:38,479 Speaker 1: think should not exist. This is her confirmation hearing, and 10 00:00:38,680 --> 00:00:41,360 Speaker 1: at it, Kranninger discussed her commitment to keep in the 11 00:00:41,360 --> 00:00:44,800 Speaker 1: CFPB true to its mandate. For more on this story, 12 00:00:44,800 --> 00:00:47,199 Speaker 1: we're joined now by Evan Weinberger. He's a reporter for 13 00:00:47,280 --> 00:00:49,680 Speaker 1: Bloomberg Law. He's in our Bloomberg eleven three, our studios 14 00:00:49,680 --> 00:00:52,920 Speaker 1: in New York and having a lot of people have 15 00:00:52,960 --> 00:00:55,880 Speaker 1: been scratching their heads about this one. What is up 16 00:00:55,880 --> 00:00:59,560 Speaker 1: with this nomination? Well, what is up is that at 17 00:00:59,560 --> 00:01:01,320 Speaker 1: this point looks like she has the votes to at 18 00:01:01,360 --> 00:01:03,680 Speaker 1: least make it out of committee, and if Mitch McConnell 19 00:01:03,680 --> 00:01:05,880 Speaker 1: wants to bring it before the Centaploor get her confirmed 20 00:01:05,880 --> 00:01:08,320 Speaker 1: to be the next director of the Consumer Financial Protection 21 00:01:08,319 --> 00:01:14,240 Speaker 1: Bureau UM after that. The real motivation here was at 22 00:01:14,280 --> 00:01:16,840 Speaker 1: the end of June there was a deadline to nominate somebody. 23 00:01:16,880 --> 00:01:19,959 Speaker 1: Otherwise mc mulvaney, who's currently the acting director, would have 24 00:01:19,959 --> 00:01:22,880 Speaker 1: had to leave his post at the CFPB. So they 25 00:01:23,040 --> 00:01:26,280 Speaker 1: put in Kathy Cranniger, who was kind of an unknown quantity. 26 00:01:26,400 --> 00:01:30,080 Speaker 1: She works at the Office Management and Budget, where mcmilvany 27 00:01:30,120 --> 00:01:34,880 Speaker 1: also works UM, and nobody really knew anything about her. 28 00:01:34,880 --> 00:01:37,600 Speaker 1: She didn't have any experience of financial policy or in 29 00:01:37,720 --> 00:01:41,360 Speaker 1: consumer finance or anything relevant to the CFPB, mostly in 30 00:01:41,680 --> 00:01:44,760 Speaker 1: budget work and Department of Homemound Security and security issues, 31 00:01:44,800 --> 00:01:48,720 Speaker 1: things like that. That's a kind of a shell nomination, 32 00:01:48,840 --> 00:01:55,000 Speaker 1: or I wouldn't say shell necessarily, although it's it's clear 33 00:01:55,080 --> 00:01:59,000 Speaker 1: that if she is confirmed, she's most likely going to 34 00:01:59,040 --> 00:02:03,320 Speaker 1: follow along with what mcilvaney has been doing at the CFPB. UM. 35 00:02:03,480 --> 00:02:06,480 Speaker 1: She's a budget person. The Trump administration proposed cutting the 36 00:02:06,480 --> 00:02:11,600 Speaker 1: cfpp's budget by in fiscal but because it's an independent agency, 37 00:02:11,600 --> 00:02:14,360 Speaker 1: they don't actually have any control. The fear and Senator 38 00:02:14,400 --> 00:02:17,480 Speaker 1: Elizabeth Warren, who was kind of the brainchild of the 39 00:02:17,480 --> 00:02:22,320 Speaker 1: cfpb the intellectual architect of the cfpb. UH. She expressed 40 00:02:22,320 --> 00:02:24,839 Speaker 1: some concerns that Cranninger is going to go in there 41 00:02:24,919 --> 00:02:27,320 Speaker 1: and find ways to cut that budget, whether it's firing 42 00:02:27,360 --> 00:02:31,000 Speaker 1: civil servants or cutting examination budgets and things of that nature. 43 00:02:31,520 --> 00:02:34,920 Speaker 1: Had did Crowdinger in the nomination? Since she has no 44 00:02:35,040 --> 00:02:39,040 Speaker 1: experience in banking or financial services? What did she say 45 00:02:39,120 --> 00:02:42,960 Speaker 1: her qualifications are for running this consumer watchdog, the biggest 46 00:02:42,960 --> 00:02:46,800 Speaker 1: consumer watchdog agency we have primarily budget issues. I mean, 47 00:02:46,880 --> 00:02:50,160 Speaker 1: she she by all accounts, is a talented manager. She's 48 00:02:50,200 --> 00:02:53,480 Speaker 1: a talented budget person. She knows that. She's a twenty 49 00:02:53,560 --> 00:02:57,320 Speaker 1: year veteran of government, both on Senate and House committees 50 00:02:57,880 --> 00:03:00,760 Speaker 1: and at the Department Homeland Security and the Office of 51 00:03:00,800 --> 00:03:05,480 Speaker 1: Management and Budget. So she comes in there qualified for 52 00:03:05,960 --> 00:03:09,639 Speaker 1: a range of jobs. It's just not necessarily we are too, 53 00:03:09,720 --> 00:03:12,840 Speaker 1: at least Democrats on the committee where those skills come 54 00:03:12,880 --> 00:03:16,160 Speaker 1: into play when it comes to running a consumer regulator. Yeah. 55 00:03:16,400 --> 00:03:18,960 Speaker 1: One of our stories on the terminal calls her an 56 00:03:19,080 --> 00:03:23,560 Speaker 1: enigma kind of she most definitely mastered the skill of 57 00:03:24,000 --> 00:03:26,600 Speaker 1: using a lot of words to stay a very little 58 00:03:26,600 --> 00:03:31,160 Speaker 1: amount in the questions from senators. But we know what 59 00:03:31,320 --> 00:03:36,200 Speaker 1: the President thinks of the Consumer Financial Protection Bureau. He 60 00:03:36,400 --> 00:03:39,600 Speaker 1: doesn't like it, he wants to roll it back, cut 61 00:03:39,680 --> 00:03:42,400 Speaker 1: it and all that. She's just she's going to follow 62 00:03:42,600 --> 00:03:46,480 Speaker 1: the marching orders. Um that is the best guess that 63 00:03:46,520 --> 00:03:50,240 Speaker 1: anyone has a source of mind. Uh emailed me during 64 00:03:50,280 --> 00:03:53,280 Speaker 1: the hearing. I actually know less about Kathy Crottinger now 65 00:03:53,320 --> 00:03:57,120 Speaker 1: than I did before the hearing started. So we mentioned, 66 00:03:57,160 --> 00:04:00,400 Speaker 1: you mentioned Elizabeth Warren, and this the CFPP is her baby, 67 00:04:00,440 --> 00:04:04,280 Speaker 1: so to speak, and we've seen her in these hearings 68 00:04:04,360 --> 00:04:09,560 Speaker 1: get very you know, sarcastic, sharp, whatever you want to 69 00:04:09,600 --> 00:04:13,200 Speaker 1: call it. Did she take that attitude with Kranneinger. She 70 00:04:13,560 --> 00:04:16,880 Speaker 1: was outraged at Kranneger, but not because of CFPB issues, 71 00:04:17,040 --> 00:04:19,039 Speaker 1: at least at the start. Her first round of questioning 72 00:04:19,440 --> 00:04:24,440 Speaker 1: focused on Kranneger's potential role in the Trump administration zero 73 00:04:24,520 --> 00:04:28,400 Speaker 1: tolerant immigration policies and the child separation policies at the border, 74 00:04:28,520 --> 00:04:31,560 Speaker 1: because her role at o m B is to oversee 75 00:04:32,520 --> 00:04:36,680 Speaker 1: the Homeland Security Department and Justice Department's budgets. So Democrats 76 00:04:36,720 --> 00:04:39,680 Speaker 1: had asked for the hearing to be postponed to get 77 00:04:39,720 --> 00:04:43,000 Speaker 1: more information about what she did in helping to craft 78 00:04:43,040 --> 00:04:45,960 Speaker 1: the policy and the documents, right, I mean, at one point, 79 00:04:46,080 --> 00:04:51,840 Speaker 1: uh Warren said that the child separation policies will be 80 00:04:51,880 --> 00:04:56,719 Speaker 1: a moral stain on Kranneger, and any senators who vote 81 00:04:56,760 --> 00:04:59,680 Speaker 1: to confirm her will have will carry that moral stain 82 00:04:59,760 --> 00:05:01,360 Speaker 1: because as they gave her a big promotion in the 83 00:05:01,360 --> 00:05:05,000 Speaker 1: wake of it. Can we clarify to just for the record, 84 00:05:05,680 --> 00:05:08,280 Speaker 1: what mc mulvaney has actually done at the CFP b 85 00:05:08,520 --> 00:05:11,080 Speaker 1: B while he's there. I know that he has rolled 86 00:05:11,120 --> 00:05:14,599 Speaker 1: back some proposed regulations and some consumer protections, but the 87 00:05:14,600 --> 00:05:19,680 Speaker 1: CFPB still has a basic mission that it must fulfill, 88 00:05:19,760 --> 00:05:23,640 Speaker 1: right well, what one of mc mulvaney's first actions was 89 00:05:23,920 --> 00:05:27,599 Speaker 1: to say that a controversial payday lending rule that the 90 00:05:27,600 --> 00:05:32,000 Speaker 1: CFB finalized right before his predecessor, Richard Coudray left the bureau, 91 00:05:32,760 --> 00:05:37,320 Speaker 1: uh it was scheduled to take effect. Mulveney said that 92 00:05:37,360 --> 00:05:41,359 Speaker 1: they're going to reconsider it, and many advocates for the 93 00:05:41,480 --> 00:05:44,560 Speaker 1: rules think that that's just a prelude to eliminating the 94 00:05:44,640 --> 00:05:49,200 Speaker 1: rule altogether. There also, he took the cf AB's Office 95 00:05:49,200 --> 00:05:52,359 Speaker 1: of Fair Lending, which was its main anti discrimination unit, 96 00:05:52,720 --> 00:05:56,080 Speaker 1: and it had been a fairly independent office within the 97 00:05:56,200 --> 00:06:01,040 Speaker 1: CFPB UH, Mulveney took that and for that into another unit, 98 00:06:01,360 --> 00:06:06,160 Speaker 1: took away its independent enforcement authority UH, and there he 99 00:06:06,279 --> 00:06:10,400 Speaker 1: has slowed down the pace of enforcement actions. And even 100 00:06:10,440 --> 00:06:13,279 Speaker 1: with the enforcement actions that he's taken outside of the 101 00:06:13,279 --> 00:06:16,880 Speaker 1: Walls Fargo UH enforcement action from earlier in the summer, 102 00:06:17,760 --> 00:06:22,719 Speaker 1: he's taken a much lighter touch on enforcement actions than 103 00:06:22,839 --> 00:06:26,000 Speaker 1: his predecessor did. And when she was asked by Shared 104 00:06:26,040 --> 00:06:29,240 Speaker 1: Brown to name something specific that she approved of that 105 00:06:29,360 --> 00:06:32,559 Speaker 1: Mulvaaney has done, it was or that the CFPB has done. 106 00:06:32,800 --> 00:06:36,120 Speaker 1: She mentioned Wells Fargo and Equifax, right, not the two 107 00:06:36,120 --> 00:06:40,200 Speaker 1: biggest things that they've they've well Wells Fargo technically was 108 00:06:40,240 --> 00:06:44,040 Speaker 1: the biggest enforcement penalty that that the CFB had ever applied, 109 00:06:44,080 --> 00:06:47,800 Speaker 1: but one it did it in conjunction with the Office 110 00:06:47,880 --> 00:06:50,240 Speaker 1: of the Controller of the Currency, which is another bank regulator. 111 00:06:50,560 --> 00:06:53,400 Speaker 1: And they also did it after the President tweeted that 112 00:06:53,480 --> 00:06:56,240 Speaker 1: there would be big penalties for Wells Fargo. Evan Weinberger, 113 00:06:56,240 --> 00:07:04,840 Speaker 1: reporter for Bloomberg Law, Thanks for your reporting. The Republicans 114 00:07:04,839 --> 00:07:08,520 Speaker 1: sweeping federal tax law put a new ten thousand dollar 115 00:07:08,640 --> 00:07:11,680 Speaker 1: cap on the federal tax deduction for state in local taxes, 116 00:07:12,000 --> 00:07:15,200 Speaker 1: which will hit Northeastern states like New York hard. Here's 117 00:07:15,200 --> 00:07:17,760 Speaker 1: New York's Governor Andrew Cuomo on the tax plan in 118 00:07:17,840 --> 00:07:22,400 Speaker 1: late they call it a tax cart plan. In New York, 119 00:07:22,520 --> 00:07:26,320 Speaker 1: it is a tax increase plan. So now New York 120 00:07:26,360 --> 00:07:29,200 Speaker 1: is joining with New Jersey, Connecticut, and Maryland and suing 121 00:07:29,200 --> 00:07:32,600 Speaker 1: the Trump administration to invalidate the cap. Joining me is 122 00:07:32,680 --> 00:07:36,400 Speaker 1: Laurence Zelenak, a tax professor at Duke Law School. So 123 00:07:36,480 --> 00:07:39,320 Speaker 1: let's start with the basics. How much will this cap 124 00:07:39,360 --> 00:07:43,240 Speaker 1: on the so called salt deduction actually affect taxpayers in 125 00:07:43,280 --> 00:07:48,640 Speaker 1: these Northeastern states. Well, it affects you if you pay 126 00:07:48,760 --> 00:07:52,160 Speaker 1: more than ten thousand dollars in state and local taxes, 127 00:07:52,200 --> 00:07:55,440 Speaker 1: and that would be the sum of your property taxes 128 00:07:55,480 --> 00:08:00,000 Speaker 1: and your state income tax. Uh, it will be Uh. 129 00:08:00,040 --> 00:08:03,120 Speaker 1: I can't give you specific data on those states, but 130 00:08:03,120 --> 00:08:06,600 Speaker 1: but it's it's clearly significant. I. UM, there will be 131 00:08:06,680 --> 00:08:10,280 Speaker 1: some people who would have had a tax cut from 132 00:08:10,320 --> 00:08:13,360 Speaker 1: the rate reductions if it weren't for the salt limit, 133 00:08:13,440 --> 00:08:15,800 Speaker 1: where with the salt limit there end up gonna they're 134 00:08:15,800 --> 00:08:17,800 Speaker 1: gonna end up having no tax cut or even a 135 00:08:17,800 --> 00:08:21,240 Speaker 1: tax increase. So on what legal basis are the states 136 00:08:21,320 --> 00:08:25,400 Speaker 1: bringing the lawsuit. Well there, their argument, which I think 137 00:08:25,480 --> 00:08:31,480 Speaker 1: is extremely weak, is that a state and local tax 138 00:08:31,520 --> 00:08:35,600 Speaker 1: deduction is constitutionally required. It's so it's based on the 139 00:08:35,679 --> 00:08:39,640 Speaker 1: on the tenth Amendment, which says basically that power is 140 00:08:39,640 --> 00:08:43,520 Speaker 1: not specifically convert conferred on on the federal government by 141 00:08:43,559 --> 00:08:46,920 Speaker 1: the Constitution, are reserved to the state and by general 142 00:08:46,920 --> 00:08:50,440 Speaker 1: principles and on general principles of federalism or states rights. 143 00:08:50,520 --> 00:08:54,280 Speaker 1: But I think it's a very much a long shot. 144 00:08:55,000 --> 00:08:59,040 Speaker 1: Why why a long shot? Well, a couple of reasons. 145 00:08:59,440 --> 00:09:03,520 Speaker 1: One is um there's a Supreme Court case which from 146 00:09:04,600 --> 00:09:08,480 Speaker 1: called South Carolina v. Baker, which is not directly on point, 147 00:09:08,520 --> 00:09:12,360 Speaker 1: but it's pretty darn close. So since the beginning of 148 00:09:12,440 --> 00:09:17,200 Speaker 1: the federal income tax, interest on municipal bonds or state 149 00:09:17,200 --> 00:09:19,760 Speaker 1: in local bonds had been tax exempt. Then in the 150 00:09:19,760 --> 00:09:27,280 Speaker 1: early nineteen eighties, UM Congress imposed a minor limitation on 151 00:09:27,360 --> 00:09:32,480 Speaker 1: that exemption, which said basically that the exemption no longer 152 00:09:32,559 --> 00:09:35,040 Speaker 1: applied to state and local bonds that were not in 153 00:09:35,120 --> 00:09:38,040 Speaker 1: registered form. So if you could hold the bonds anonymously, 154 00:09:38,120 --> 00:09:41,840 Speaker 1: then the income wasn't tax exempt anymore. And South Carolina, 155 00:09:41,880 --> 00:09:45,240 Speaker 1: a number of other States sued on on the basis 156 00:09:45,280 --> 00:09:48,480 Speaker 1: that they had arguing that they had a constitutional right 157 00:09:48,520 --> 00:09:52,520 Speaker 1: to issue bonds with income tax exempt at the federal 158 00:09:52,600 --> 00:10:00,000 Speaker 1: level UM and that, uh, therefore, the early nineteenies legist 159 00:10:00,040 --> 00:10:05,320 Speaker 1: Lasian violated their constitutional rights. And in in the South 160 00:10:05,320 --> 00:10:07,480 Speaker 1: Carolina by Baker case, the Supreme Court ruled by a 161 00:10:07,559 --> 00:10:09,640 Speaker 1: vote of eight to one. So it wasn't even close 162 00:10:10,080 --> 00:10:14,280 Speaker 1: that there was no constitutional requirement that state and local 163 00:10:14,280 --> 00:10:18,080 Speaker 1: bond interest be tax exempt. Now this is not, obviously 164 00:10:18,080 --> 00:10:20,520 Speaker 1: not exactly the same issue, but on the other hand, 165 00:10:20,559 --> 00:10:24,000 Speaker 1: it's pretty darn close. And uh, it's hard for me 166 00:10:24,080 --> 00:10:26,640 Speaker 1: to see what the argument would be for distinguishing South 167 00:10:26,640 --> 00:10:29,679 Speaker 1: Carolina by Baker so Lawrence. In in the complaints, some 168 00:10:29,760 --> 00:10:33,080 Speaker 1: of the things that the States says. The States say 169 00:10:33,240 --> 00:10:35,960 Speaker 1: is that the federal government went after the states deliberately 170 00:10:36,440 --> 00:10:41,439 Speaker 1: that are democratic. And they they quote conservative economist even Moore, 171 00:10:41,520 --> 00:10:45,319 Speaker 1: who advised Trump on the tax policy, quoting him as saying, 172 00:10:45,320 --> 00:10:49,560 Speaker 1: the salt deduction is death to Democrats. Will that play 173 00:10:49,640 --> 00:10:53,120 Speaker 1: any part in the Court's decision whether this was done 174 00:10:53,200 --> 00:10:57,480 Speaker 1: to hit democratic states? Well, I don't think so. I mean, 175 00:10:57,559 --> 00:11:02,520 Speaker 1: my my, if I remember right in the recent UM 176 00:11:02,640 --> 00:11:07,160 Speaker 1: um Supreme Court ruling on the the the immigration restrictions. 177 00:11:07,320 --> 00:11:11,680 Speaker 1: There was there were quotations not from Stephen Moore, who 178 00:11:11,720 --> 00:11:13,760 Speaker 1: I think kind of doesn't count in a way, and 179 00:11:13,800 --> 00:11:16,600 Speaker 1: he's not he's not in Congress after all, that from 180 00:11:16,640 --> 00:11:21,000 Speaker 1: from the President himself indicating some dubious motivation, and h 181 00:11:21,080 --> 00:11:23,480 Speaker 1: and and and the court said that didn't matter. So 182 00:11:23,559 --> 00:11:27,280 Speaker 1: if if the president's motivation doesn't matter, I hardly think 183 00:11:27,280 --> 00:11:30,400 Speaker 1: that Stephen Moore's motivation is probably going to be that crucial. 184 00:11:30,600 --> 00:11:32,800 Speaker 1: Can I put corn out? One? One other thing, and 185 00:11:33,080 --> 00:11:37,720 Speaker 1: relating to this is um if if if the state 186 00:11:37,720 --> 00:11:41,400 Speaker 1: and local tax deduction is really constitutionally required, then the 187 00:11:41,480 --> 00:11:44,520 Speaker 1: federal income tax has probably been unconstitutional for a long 188 00:11:44,600 --> 00:11:48,800 Speaker 1: time because it's it's always been the case that you 189 00:11:48,880 --> 00:11:51,080 Speaker 1: get to deduct your state and local taxes only if 190 00:11:51,120 --> 00:11:55,960 Speaker 1: you itemize, and traditionally the percentage of taxpayers who itemize 191 00:11:56,200 --> 00:11:59,319 Speaker 1: has only been about one third. So so we've had 192 00:11:59,320 --> 00:12:02,400 Speaker 1: a situation we're all along about two thirds of taxpayers 193 00:12:02,400 --> 00:12:07,040 Speaker 1: have not gotten this deduction, which supposedly is is constitutionally required. 194 00:12:07,080 --> 00:12:09,760 Speaker 1: In addition to anyone who's subject to the alternative minimum 195 00:12:09,800 --> 00:12:13,959 Speaker 1: tax hasn't been allowed the salt deduction for since I 196 00:12:14,000 --> 00:12:18,080 Speaker 1: think nineties six and and for a long period of 197 00:12:18,120 --> 00:12:24,280 Speaker 1: time from until fairly recently. UM, state sales tax wasn't 198 00:12:24,360 --> 00:12:29,439 Speaker 1: deductible under any circumstances. UM. And all of those things, 199 00:12:29,440 --> 00:12:34,120 Speaker 1: by the logic of this new lawsuit, UM, we probably 200 00:12:34,160 --> 00:12:37,840 Speaker 1: were unconstitutional, but of course they weren't unconstitutional. And for 201 00:12:37,920 --> 00:12:41,640 Speaker 1: the same reason they weren't unconstitutionally. I don't expect this 202 00:12:41,720 --> 00:12:44,960 Speaker 1: loss to succeed either. Well, let's let's switch a little bit. 203 00:12:45,000 --> 00:12:49,000 Speaker 1: We have a minute here. Governor Cuomo advanced proposals in 204 00:12:49,040 --> 00:12:51,120 Speaker 1: the state budget this year to help New Yorkers try 205 00:12:51,160 --> 00:12:54,560 Speaker 1: to circumvent the cap on deductions, creation of new charitable 206 00:12:54,600 --> 00:12:57,800 Speaker 1: credits and payroll tax deductions. The i R said in 207 00:12:57,880 --> 00:13:00,920 Speaker 1: May that it would scrutinize that New York tax workaround. 208 00:13:01,040 --> 00:13:06,160 Speaker 1: Has anything happened there? Uh? No, not. Well, I have 209 00:13:06,200 --> 00:13:08,160 Speaker 1: an article on the very topic coming out in tax 210 00:13:09,120 --> 00:13:11,200 Speaker 1: Well tell us, tell us in thirty seconds that the 211 00:13:11,240 --> 00:13:14,719 Speaker 1: basics of your article, Uh, that that I think that 212 00:13:15,000 --> 00:13:19,640 Speaker 1: there's two different kinds of workarounds. UM. One is trying 213 00:13:19,679 --> 00:13:22,400 Speaker 1: to convert charitable or excuse me, trying to convert state 214 00:13:22,440 --> 00:13:25,240 Speaker 1: in local taxes to charitable deductions. That's what the article 215 00:13:25,320 --> 00:13:28,160 Speaker 1: is about, and I conclude that doesn't work. The other 216 00:13:28,280 --> 00:13:34,800 Speaker 1: the other workaround UM is basically trying to convert state 217 00:13:34,840 --> 00:13:38,880 Speaker 1: taxes income taxes on wages into a payroll tax paid 218 00:13:38,920 --> 00:13:41,920 Speaker 1: by the employer rather than by the employee. I think 219 00:13:42,120 --> 00:13:45,720 Speaker 1: that probably could work as far as the federal tax 220 00:13:45,800 --> 00:13:48,199 Speaker 1: result is concern. Okay, we're going to take that good news. 221 00:13:48,600 --> 00:13:50,559 Speaker 1: You'll have to end it there. Thanks so much. That's 222 00:13:50,600 --> 00:13:53,920 Speaker 1: Laurence Zelena, perhaps professor at Duke Law School. Thanks for 223 00:13:54,000 --> 00:13:57,240 Speaker 1: listening to the Bloomberg Law Podcast. You can subscribe and 224 00:13:57,320 --> 00:14:00,400 Speaker 1: listen to the show on Apple Podcasts, Sounds Out, and 225 00:14:00,480 --> 00:14:04,920 Speaker 1: on Bloomberg dot com slash podcast. I'm June Rosso. This 226 00:14:05,280 --> 00:14:11,840 Speaker 1: is Bloomberg m HM.