(Source: Center on Budget and Policy Priorities, "Average Income in 2006 Up $60,000 for Top 1 Percent of Households, Just $430 for Bottom 90 Percent") After a discussion about federal tax policy and income inequality, Steven Pearlstein strikes the right chord on where the discussion on inequality should be focused. As much as the distributional consequences of the tax code matter, there's still the nagging problem of pre-tax income inequality. Despite major advances in worker productivity over the past 40 years, workers have seen only a sliver of that economic gain.

The U.S. Chamber of Commerce would prefer that you not know that the U.S. corporate tax code leaks revenue like a sieve. Chamber spokesman Martin Regalia complains about the media's and Sens. Carl Levin's (D-MI) and Byron Dorgan's (D-ND) treatment of a recent GAO report on corporate tax avoidance.

If it weren't for its direct impact on national security, we could all enjoy a hardy guffaw at the $500 million mess that is supposed to tie the nation's intelligence data together. The anti-terror intelligence database, known as Terrorist Identities Datamart Environment (TIDE), is the subject of recent House Science and Technology Committee's Investigations and Oversight Subcommittee report. The report found that "Railhead," the $500 million project that was supposed to tie together the intelligence data of the nation's 16 separate intelligence agencies. Instead:

Brad DeLong has a great post on the tradeoffs we face in bringing the long-term budget into balance.