Wednesday, April 01, 2026

HEGSETH the knives are out: The Matthew Effect and Federal Taxation

Czech Republic beat Denmark 3-1 on penalties to qualify for the 2026 World Cup 🇨🇿


“Those of us who shout the loudest about Americanism in making character assassinations are all too frequently those who, by our own words and acts, ignore some of the basic principles of Americanism

The right to criticize.

The right to hold unpopular beliefs.

The right to protest.

The right of independent thought.” — Margaret Chase Smith, first woman to serve in both houses of Congress


Revenue the Australian Government is estimated to have not collected since July 2022 by not implementing a 25% tax on liquefied natural gas exports.

Australia's Gas Giveaway


Fake IDs and laptop farms: North Korea targets Australian firms to fund weapons program

Australia is firmly in the sights of North Korea’s aggressive thousands-strong army of agents posing as remote IT workers.


A new edition of On Liberty, a canonical work of political philosophy, “is the first to show officially name Harriet Taylor Mill as a co-author alongside John Stuart Mill”.



The leaks keep coming from inside targeting Hagueseth. Similar to leaks that kept coming targeting Noem before she was booted out of DHS. The knives are out.

“. . . A broker for Pete Hegseth, the US defence secretary, attempted to make a big investment in major defence companies in the weeks leading up to the US-Israeli attack on Iran, according to three people familiar with the matter.”
Just 4 days ago NYT did a 4-byline story as well zeroing on Hegseth's "unusual decision to remove officers from a one star promotion list" spurring "allegations of racism and gender bias." That story also seemed to be generated from the inside.





Martin McMahon (Florida), The Matthew Effect and Federal Taxation

Abstract: “For whosoever hath, to him shall be given, and he shall have more abundance; But whosoever hath not, from him shall be taken away even that he hath.” — Gospel of Matthew, chapter 25, verse 29. 

The term the “Matthew effect,” was coined by sociologist Robert K. Merton in 1968 based on the passage from the Gospel of Matthew in the epigram. “Put in less stately language, the Matthew effect insists in the accruing of greater increments of recognition for particular scientific contributions to scientists of considerable repute and the withholding of such recognition from scientists who have not yet made their mark.” 

The Matthew effect is not limited to the context in which Robert Merton first coined it. More generally, it is a synonym for the well known colloquial aphorism, “the rich get richer and the poor get poorer.” This article is about the Matthew effect in the distribution of incomes in the United States, and the failure of the federal tax system to address the Matthew effect.


Bush & Cheney 2003 Tax Returns

Thursday, April 15, 2004

Jack Bogdanski’s (Lewis & Clark) blog has a great post about the Bush Cheney 2003 tax returns released by the White House (as well as a great cartoon suitable for classroom use). He also promises future blogging about the motherlode of tax returns released by John Kerry (1999-2003 returns).



Herzfeld: Wars and Oil Crises Drive Tax Policy Shifts

Mindy Herzfeld (Florida), Wars and Oil Crises Drive Tax Policy Shifts, 121 Tax Notes Int’l 2101 (March 23, 2026)

The U.S. bombing of Iran has disrupted oil shipments through the Strait of Hormuz, leading to wild swings in the price of oil and reports of windfall profits for U.S. oil companies. (See “U.S. Oil Groups in Line for $63bn Windfall From Gulf War Disruption,” Financial Times, Mar. 14, 2026.) This $60 billion in projected excess profits far exceeds the cost of the first two weeks of the war, estimated at approximately $16 billion.



Why Trump only has a month left to end the warTelegraph. Word of the low stockpiles is getting out.

How to find data

How to find and vet credible data sources you can use right away – NICAR 2026 meeting – Slide Deck by Stephanie Lamm, The Atlanta Journal-Constitution; Greg Morton, Baltimore Banner; Sean Mussenden, University of Maryland.

A new source I learned about via this presentation – WONDER online databases utilize a rich ad-hoc query system for the analysis of public health data. 

Reports and other query systems are also available. Data & Site Updates Changes are coming to CDC WONDER! As part of CDC’s ongoing digital modernization, we’re improving how you access public health data. In the coming months, expect to see changes that make CDC WONDER easier to navigate and simpler to understand.


Data is Beautiful – VeridionData – Top 20 Federal Government Contractor by Contract Value

  • Sources: SAM.gov/FPDS FY2023 all-federal contract obligations, supplemented with FY2024 DoD data from Defense Security Monitor and Washington Technology Top 100.
  • FY2023 because it’s the latest complete all-agency dataset publicly available. Subsidiaries rolled up under parent companies. I handle the sector labels; some companies straddle categories.
  • What’s missing: Classified spending, subcontracts, and IT reseller pass-through. AWS and Palo Alto sell billions to gov through aggregators like Carahsoft, so their prime contract numbers are way understated.
  • Tools: HTML/CSS, Puppeteer for export.

Mike Baird goes missing from KPMG

Mike Baird goes missing from KPMG
The former premier didn’t even make it to the two-year mark of the consulting firm’s mission to improve its governance. 
Hannah Wootton
Apr 1, 2026 – 
Former NSW premier Mike Baird describes himself as “making a mid (to late) life comeback” at the top of his LinkedIn profile and the work history that follows suggests he’s succeeding.
He’s had two executive roles at NAB and a four-year stint as chief executive of HammondCare since leaving politics in 2017. He’s chaired Cricket Australia since 2022 and is currently running politics think tank McKinnon Institute.
Curiously missing though, is his directorship of KPMG. The firm announced with much aplomb that he and Jane Hemstritch had joined Patty Akopiantz as independent directors on its partner-heavy board in 2024. It came amid a push by consulting firms to show their partnerships weren’t the accountability-free rodeos the PwC tax leaks scandal made them seem.
Mike Baird may juggle a few balls, but KPMG’s governance isn’t one of them any more. Nic Walker
It turns out it’s not just absent from his profile though – Baird is absent from the board! He stepped down in September. KPMG quietly updated the governance page of its website and replaced him with former SBS CEO Michael Ebeid, but made no formal announcement. It seems nobody even realised, in fact, until one of our spies alerted us to the change.
It’s unclear why Baird left, other than it was his choice and he has other commitments. We asked him and got crickets. But it comes as KPMG catches the attention of Canberra. Labor’s Deborah O’Neill used parliamentary privilege to air a laundry list of unverified claims by a former KPMG executive last week, including allegationsthat the firm misused confidential client information and capitalised on conflicted networks of contacts to get 

They are just allegations. But they’re the exact sort of problems that governments, regulators and clients have a laser-like focus on after the tax leaks saga. The joint committee on corporations and financial services is now looking into it. The threat of a parliamentary inquirylooms.


This is relevant to Baird as we are told he was one of the directors who received a message from the whistleblower relating to the way the firm was dealing with complaints. The firm’s treatment of that whistleblower is part of O’Neill’s concerns.


We aren’t suggesting Baird himself responded in any way that wasn’t best practice. But the headache of the whistleblower allegations follows concerns about conflictsin KPMG’s NSW government work, its staff using AI to cheat in tests, and suggestions it overcharged the Defence Department. It’s not a fun time to be on the KPMG board, especially as its resident politician whisperer. So we can’t blame Baird for getting out.

His selection as an independent director caused raised eyebrows back in 2022. KPMG was always close to Baird’s state government. The premier himself detoured from the 2015 state election campaign to open KPMG’s Parramatta office, and sat for an interview with KPMG’s in-house magazine that same year.
The firm was also the biggest recipient of NSW consulting contracts for many years. One of the blips in Baird’s premiership was in 2016, when he came under fire for hiring KPMG to assess the government’s planned local council amalgamations despite the firm previously providing advice on the changes. Neither he nor KPMG saw any conflict of interest issues with the arrangement. Needless to say, the opposition and various councils did. It even ended up in court.
When chairman Martin Sheppard announced Baird’s appointment in 2022, he said the ex-premier’s “understanding of parliamentary processes” would benefit the firm. Unfortunate experience for it to lose, should O’Neill’s inquiry reach the point where KPMG’s staff and bosses (and perhaps even Baird himself) are hauled before parliament.
The country’s most expert opinion and analysis. Sign up to our weekly Opinion newsletter.
 is a Rear Window columnist, based in Melbourne. Connect with Hannah on Twitter. Email Hannah at hannah.wootton@afr.com

Tuesday, March 31, 2026

Two years of secrecy: Big four accounting firms still skirt oversight

 AI is being blamed for job losses and those using it including a former PwC employee are warning this may just be the star

Watch 7.30, Mondays to Thursdays 7:30pm on ABC iview and ABC TV

Former PwC employee Donald King has a bleak warning for workers not using artificial intelligence yet.

"If you're not using AI then you should be worried. You should definitely be worried," he told 7.30.

"It really is adopt AI or die."



Two years of secrecy: Big four accounting firms still skirt oversight


Treasury has been told the big four accounting firms Deloitte, EY, KPMG and PwC operate in a regulatory grey area with gaps in how the partnerships are policed, and the current oversight of audit quality is inadequate.

A summary of dozens of responses to the department’s consultation into auditing and consulting governance also outlined support for giving the corporate regulator the power to sanction firms, as opposed to individuals, an idea that is vehemently opposed by the accounting sector.

The consultation, which closed in mid-2024, was triggered by the PwC tax leaks scandal and followed a parliamentary inquiry that made 40 recommendations to reform the sector. Details of the 36 submissions and 16 private forums are contained in a ministerial summary, released under Freedom of Information laws.


The response dodged major recommendations that the Treasury consultation was examining, such as a bipartisan proposal to slash partner numbers at the big four consulting firms to a maximum of 400 equity partners – bringing them into line with law firms. Other inquiry recommendations examined by Treasury included partnerships rules, governance of the sector and auditing standards.

‘Regulatory gap’

The Treasury summary of the submissions found there was a “regulatory gap in which professional standards, regulations [and] laws apply only at the individual registered auditor level ...while the management of audit partnerships make[s] decisions affecting audit quality, relating to independence and audit resourcing”.

There was also support for the view of Joe Longo, the chairman of the Australian Securities and Investments Commission, that because of legal grey areas ASIC only regulates a “sliver” of services provided by the big four. Different parts of the big four firms are also accountable to bodies such as the Australian Taxation Office and the Tax Practitioners Board.

The summary found agreement that it was difficult for regulators “to take action against an audit partnership for misconduct, either relating to an individual’s conduct or partnership conduct” and that the partnership structure of the big four firms meant they were “not regulated by ASIC despite the work conducted by these partnerships (such as audit) being worthy of regulatory attention”.

The summary also noted “ambiguity and uncertainty among stakeholders as to the various roles, responsibilities and remits of organisations within the shared regulatory framework”. Professional bodies such as Chartered Accountants ANZ “do not see themselves as a ‘front line’ defence, or a ‘quasi-regulator’, but as supplementary to the existing regulatory framework.”

Respondents were also of the view that ASIC was not doing a good enough job of monitoring audit quality.

“Current regulatory oversight regarding audit quality in Australia is not adequate,” the summary states. “ASIC’s current surveillance and enforcement activity is not seen as a strong deterrent against poor conduct – especially in relation to overseas counterparts, particularly the US.”

The Treasury consultation paper made clear the government’s overriding concern around any potential changes was protecting the quality of three services critical to the wider economy: auditing, taxation and insolvency.

Firms vs everyone else

The firms that submitted responses included the big four and smaller firms Pitcher Partners, PKF Australia, Moore Australia and Forvis Mazars. Other submitters included accounting professional bodies such as CA ANZ, CPA Australia and the Institute of Public Accountants, ASIC and university experts.

A table in the document outlining the broad views of the group shows the big four firms support increases to the current governance standards but feel existing compliance standards should stay the same. This includes allowing the firms to self-regulate when it comes to providing non-audit services to auditing clients.

The big four also broadly support greater public disclosure and complained that ASIC did not track the audit quality of smaller firms.

Mid-tier and smaller firms opposed any increase to governance and compliance standards. The mid-tier firms complained the existing regime was already costly and pricing them out of smaller audits.

There was disagreement in the submissions about the idea to force large firms to structurally separate their audit and non-audit arms. There was also debate over whether self-regulation of the sector was working with company directors “confident that existing regulatory requirements and governance practices safeguard auditor independence”.

The regulators and standard setters said there was a clear need for “firm level regulatory action” because “the current system’s penalties – that focus on individuals – fail to incentivise firm-wide compliance effectively”.

There was general agreement among the submissions that partnerships should fall under existing corporate whistleblower protections.

Find out the inside scoop about Accenture, Deloitte, EY, KPMG, PwC and McKinsey. Sign up to our weekly Professional Life newsletter.

 leads our coverage of the professional services sector. He is based in our Sydney newsroom.Email Edmund at edmundtadros@afr.com.au