Saturday, January 24, 2009

Timing is Everything

Herbert R. Axelrod was a man who loved to play the violin. Herbert grew up around music as his father had been a violin teacher. Although he did not follow his father into teaching the violin, choosing instead to become an accomplished writer and publisher, Herbert still loved music, especially the strings.

Herbert began to collect instruments, especially the rare and the most sought-after. In 1975 he purchased his first Stradivarius violin.

Stradivarius

The Stradivarius instruments are considered to be the finest musical instruments ever created. They were handcrafted during the late 17th and early 18th centuries. When one of the 700 or so instruments left in the world comes up for auction it will usually sell for several million dollars.

Herbert had become such a successful writer and publisher that he donated not one, but four Stradivari to the Smithsonian. These four instruments became known as "The Axelrod Quartet" are estimated to have a value of $50 million. He also sold 30 other pieces of his collection to New Jersey Symphony Orchestra for $18 million, which doesn't sound like a deal at first, but the pieces he sold were worth upwards of another $50 million.
Herbert Axelrod

Herbert R. Axelrod appears to be a real stand-up guy, a patron of the arts, and one who used his wealth to promote the enjoyment of music through his generous gifts. But where did these $100 million worth of instruments come from? How did he manage to make that amount of money as a writer/publisher?

He made it the same way anyone else would: by refusing to pay taxes over the course of 20 years.

In 2004 Axelrod forgot to show up for his arraignment because he planned a trip to Cuba instead. Apparently he was interested in the whole non-extradition agreement Cuba and the US share and decided to take advantage of that. Germany, however does not have such an agreement, and the German authorities were more than happy to hand him over to the US when they found Axelrod in Berlin a few months later.

In 2005 Axelrod was found guilty of tax fraud and was sentenced to 18 months in prison.

So when you think about it, timing is everything. Had Herbert Axelrod waited just 4 years he could have avoided going to prison entirely and instead, become Barack Obama's Secretary of the Treasury.

And as far as I know, Timothy Geithner never gave the Smithsonian so much as a kazoo while he was "forgetting" to pay his taxes.

Obama has already reformed America back into the land of opportunity, where even a tax evader can get a seat in the cabinet.

And that's change we can believe in!

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