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How Equifax Became a Private IRS

mattstoller.substack.com

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Re: How Equifax Became a Private IRS

#41

Post by SamuelAdams »

coderintherye wrote: post #26

One thing Matt mentions but doesn't go into is how this could (should?) be a government service. In fact, there is the IRS's IVES program: https://www.irs.gov/individuals/international-taxpayers/inco... but it is already fairly antiquated. There's a great opportunity here for the IRS to provide this service (with revenue from charging the requesting entities), with citizens being self-sovereign over what data is shar…

This is a good idea, but I’m skeptical if the IRS has enough funding and resources to manage another service. They barely have enough funding for the current backlog of filed tax returns.

Re: How Equifax Became a Private IRS

#42

Post by tdeck »

kevin_thibedeau wrote: post #28
coderintherye wrote: post #26

One thing Matt mentions but doesn't go into is how this could (should?) be a government service. In fact, there is the IRS's IVES program: https://www.irs.gov/individuals/international-taxpayers/inco... but it is already fairly antiquated. There's a great opportunity here for the IRS to provide this service (with revenue from charging the requesting entities), with citizens being self-sovereign over what data is shar…

Equifax collects data that isn't true and libels its victims by disseminating it to other parties. Having that power enshrined within the government would not be a good thing.

The government already has the power to do those things. The track record of credit reporting agencies shows it's almost impossible to hold them accountable, so what's the advantage to having these private entities profiting off of us again?

Re: How Equifax Became a Private IRS

#43

Post by refurb »

coderintherye wrote: post #26

One thing Matt mentions but doesn't go into is how this could (should?) be a government service. In fact, there is the IRS's IVES program: https://www.irs.gov/individuals/international-taxpayers/inco... but it is already fairly antiquated. There's a great opportunity here for the IRS to provide this service (with revenue from charging the requesting entities), with citizens being self-sovereign over what data is shar…

There is no free lunch. Limiting credit checks to AGI just means everyone will assumed to have an unknown credit history and will have much higher rates.

You ready to get a mortgage at prime plus 5% instead of prime plus 1%?

But let me guess, we could create a law about that?

Having the government do things doesn’t magically mean market forces don’t apply any more.

Re: How Equifax Became a Private IRS

#44

Post by piyh »

I've worked on the data feeds for TWN in a large company's payroll system. If I remember right they don't just get how much money you made but the line by line check level data. Your pay data probably goes out to 14 different vendors on any given pay period.

What amaze me about payroll was how accurate the data was on average, despite having wild amounts of new regulatory, healthcare, union, and pay program complexity. A surprising amount of money is directed by some lady in a payroll department making $40k with vlookup and 30 excel files on their desktop.

But there sure are some dark messy corners of data quality in people's pay and benefits.

Re: How Equifax Became a Private IRS

#45

Post by 33955985 »

refurb wrote: post #40
33955985 wrote: post #19

Earlier quoted context omitted.

A reasonable take if you ignore how this system reinforces existing inequality + the ways this system is used outside its original scope. Also you have to admit it’s kind of fucked up that there’s no total opt out mechanism.

That makes no sense. How does “checking if people are credit worthy” reinforce inequity? If you can’t repay, you shouldn’t be taking on debt. If anything it prevents people from taking on debt they can’t afford, stopping them from further inequity. And you can opt out. Don’t use credit at all. (edit: of course a credit record will still exist, but it won't matter if you don't use credit) This sounds like a bunch of p…

> And you can opt out. Don’t use credit at all.

Nope. Whether you use credit or not, the credit bureaus collect information about you and share that with all manner of other companies, including employers.

Also these systems have inherent racial biases.

https://www.forbes.com/advisor/credit-cards/from-inherent-ra...

Re: How Equifax Became a Private IRS

#46

Post by nwiswell »

jessaustin wrote: post #16
nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

Even in our most dystopian RAND-suggested bedtime story vision of a "communist hellhole", those proles who happened to possess a ruble when they got to the front of the breadline could buy a loaf. In the supercapitalist future, all transactions will require the approval of more than the two involved parties. Good luck buying anything if you ever express skepticism toward the great and powerful credit bureaus.

Perhaps I'm misunderstanding something about the point you're making, but in 2023 the third party creditor already must approve any transactions where credit is extended (e.g. credit card)

Credit bureaus remain uninvolved with cash transactions since, er, well, there's no creditor to be concerned about creditworthiness? I don't see how "supercapitalism" changes that

Re: How Equifax Became a Private IRS

#47

Post by _gmax0 »

One detail the blog leaves out is that this employment and income collection extends to both Canada and Australia.

Much of the data is noisy and I won't even get into the gory details of data ingestion. I was wondering the other day why hedge funds and etc. aren't using them as an early indicator and I can speculate why. On the other side of the spectrum, your average Joe is at times inconvenienced by Equifax's inaccurate record keeping.

Re: How Equifax Became a Private IRS

#48

Post by kube-system »

nimbius wrote: post #2

A cogent argument could.be made that transunion, Equifax, and other big private credit clearinghouses act as direct agents of an unspoken american "social credit" system in which the credit score denies housing and employment to those who refuse to or cannot conform to a largely invisible tome of rules. These agents are then unpoliced as they serve capitalisms direct need for an underclass. Full disclosure: I am a co…

The difference in the US financial system of credit and a "social credit" system is that these systems measure only attributes about financial credit, and in fact, the US has laws that specifically forbid many social factors from being used.

Re: How Equifax Became a Private IRS

#49

Post by coderintherye »

refurb wrote: post #43
coderintherye wrote: post #26

One thing Matt mentions but doesn't go into is how this could (should?) be a government service. In fact, there is the IRS's IVES program: https://www.irs.gov/individuals/international-taxpayers/inco... but it is already fairly antiquated. There's a great opportunity here for the IRS to provide this service (with revenue from charging the requesting entities), with citizens being self-sovereign over what data is shar…

There is no free lunch. Limiting credit checks to AGI just means everyone will assumed to have an unknown credit history and will have much higher rates. You ready to get a mortgage at prime plus 5% instead of prime plus 1%? But let me guess, we could create a law about that? Having the government do things doesn’t magically mean market forces don’t apply any more.

The point is not about limiting it to AGI, the point is setting limits on what data is shared so that you as the consumer always control what a requesting company sees. Don't want your data shared? No problem, you can set to deny all requests. Only want to share AGI but not your entire return, just allow that field, etc.

Correct me if I'm wrong, but your response also seems to indicate you don't work in financial services. No company is providing credit based solely on income verification (well, not that I'm aware of maybe some fintech is doing it). Most all credit providers are collating data from various sources to make their decision and it varies more than you might think on what goes into a credit decision.

Further, I don't think there's any need at all for laws for this as you suggest, rather just let the IRS offer it as a competing service with private industry. I know many companies that would sign up right away for such a service at the right price point.

Re: How Equifax Became a Private IRS

#50

Post by kornhole »

Since I can't opt out of this and all the scoundrels can see it anyway, I think I should just post my salary on my Linkedin page. If everybody did that, it would undercut this business and bring to light the inequities to the common people.
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