One Man’s Loophole is Another Man’s Good Thing

By July 26, 2007Media Relations

Reading up on Representative Doggett’s proposal to revise U.S. tax policy to raise $7.5 billion over 10 years, encountered the usual rhetoric. From CQ: “Doggett, a member of the Ways and Means Committee, aims to close what he calls a loophole that allows foreign-owned companies to minimize U.S. taxes through a practice known as “earnings stripping,” which shifts income to a country with lower tax rates.”

And the Des Moines Register: “Democrats said the measure was not a tax increase but instead was closing a loophole that foreign companies used to avoid U.S. taxes.”

Which brings us to Jack Shafer, the Press Box columnist for, who this week wrote a piece, “Shut Your Loophole.”

Over the centuries, this perfectly useful term has been corrupted by rhetorical con artists to mean terrible “gaps” in the law—or in the tax code—that demand “closing.” Because the legal code allows all that it does not prohibit, loophole prospectors needn’t look far to discover new ones. Just find a permitted behavior in the proximity of a banned one and scream, “Eureka!”

It’s a loaded, partisan word, one that implies wrongdoing and scandal where none exists, and inserting it into a political argument gives the inserter the upper hand. When loophole creeps into news stories, they start to read like editorials.

Shafer goes on to cite many examples of journalists using the term “loophole” to describe a provision, despite it being a pejorative.

Now, in both the farm bill stories, the reporters are careful to attribute the term “loophole” to the supporters of the next legislation, so there’s no journalistic transgression, just a rhetorical sleight being practiced by the advocates: They’re not seeking to close a loophole, but rather to rewrite tax policy to raise $7.5 billion by increasing taxes on foreign-based companies that do business in the United States. Why not call it what it is?

Join the discussion One Comment

  • Joe Dragon says:

    “It’s a loaded, partisan word”. Ah yes, much like the constant propaganda NAM slings about, using straw men and loaded words like “Protectionist= people who want fair trade instead of trade that benefits multinationals. “Isolationists” = who actually want more trade although Nam refuses to see it. You see we “protectionists and isolationists” really want to revise our trade policies for the betterment of our small businesses- not so Jack Welsch can make another 80 million bucks. We WANT to sell out widgets to other countries but our corporate bought politicians only side with the free traders that hire lobbyists.

    Talk about “It’s a loaded, partisan word”- NAM is full of them.

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