Donald Trump is rich, really Rich, and we know that because he says so. He’s a business genius, with an unrecognized talent for business, and we know that because, yet again, he says so.
Now, we have no reason to doubt that, except for one little thing, every time he’s asked to back those claims up, he refuses (oh yeah, and he’s a lying bastard who has a similar feeling of self achievement as Kim Jong Il had). He feels he has something to hide. Why is that? Well, we know for a start that he’s not actually as rich as he claims he is. In a 2007 deposition (caused by him getting upset and filing a SLAPP suit against a writer who said he wasn’t as rich as he claimed to be) Trump admitted that his worth is mostly tied up in his ‘Brand’ — that is his name and his perceived value in licensing. It wasn’t in his assets, it’s not anything he owns, or has earned, it’s just a random number he himself has decided he’s worth.
In effect, it’s a completely made up number.
So, the first main reason that Trump refuses to release his taxes is that it’ll prove he really isn’t as rich as he claims to be. That would destroy one of the main narrative points — if not THE main one — of his campaign, that he’s so rich that he must be successful, and people think successful people are winners and want a winner in charge. And what’s worse than claiming you’re a winner when you’re really a loser, especially a loser that claims to be worth so much more than they are, and make it their central theme, and it all be a scam. Not only is it his central theme of his campaign, it’s actually the central theme of his last 20 years, with all his (mostly ghostwritten) books focusing on his ‘guide to success’.
The second main reason that Trump may be refusing to release his taxes is that not only will they show he’s not as rich as he claims, but also that he’s really not that good at business in general.
“Some people have an ability to negotiate … It’s an art you’re basically born with. You either have it or you don’t.” (Washington Post, 1985)
His tax returns would show if he has that, or more probably, that he doesn’t. The leaked 1995 tax returns show he lost almost a Billion Dollars ($916M) in that one year alone, which is staggering for such a self-proclaimed ‘astute businessman’. It’s also raised questions in New Jersey over the state’s gambling regulators and why they weren’t concerned over his financial stability considering he owned 3 casinos there at the time. Those three casinos were soon sold off and went bankrupt.
There’s a second string to this too; anyone getting the massive kickstart in life that Trump got, money and assets left to him by his father should be rich. Now, how rich is a good question. If he took the money he was given, and just invested it in the market, the consensus is that he’d be worth what he claims, at minimum. Slate took his initial parental gift of $40M 42 years ago and came up with figures between $2.3B and $3.4B today — about what Trump claims (although as noted above, most of that is imaginary ‘value’ rather than actual assets here). Meanwhile others have estimated that, had he put the money he inherited into bonds in 1978, he’d be worth over $12B now. Basically Trump is worse at making money than the average company on theStandards&Poor 500 list, with only 300% growth since 1987. Meanwhile other businessmen managed to beat the S&P 500’s growth of 1,333% since 88 — Bill Gates grew his wealth 7,173% in that time and Warren Buffet managed 2,612%. Neither support Trump.
The third main reason why he won’t release them is underscored by his(alleged!!!!!) bribery of Florida AG Pam Bondi. There a cheque was sent to her shortly before she decided not to join in the prosecution of Trump University. However, that cheque was sent from the Trump Foundation (illegally) and as CREW executive director Noah Bookbinder reminded us this week, in the tax reports the $25,000 donation to Bondi’s campaign was listed as a different non-profit, one that the Trump Foundation WAS permitted to give to in Kansas. In releasing his tax records, such ‘innocent mistakes’ (as the Trump Foundation described it) that may be rampant in his tax records may be discovered.
The fourth reason he’s probably refusing is to avoid falling into the same trap as the last GOP Presidental candidate, Mitt Romney. In the 2012 election campaign, Romney was ridiculed for his low effective tax rate, much lower than most people, and that’s a problem for a lot of people. Trump apparently lost close to a billion dollars in 1995, which means he could write off other gains and taxes against that for a number of years afterwards — that’s just not something that’s available to other people, certainly not the vast majority of his supporters. Even losing $9,160 is a devastating hit to most of them, never mind a sum of $916,000,000, yet to him and his advisors (such as former NYC Mayor and 9/11 profiteer Rudy Giuliani, or New Jersey Governor Christie) that’s “very smart”.
Worse, he may not have actually ‘lost’ that. There are ways to manipulate things so that using shell companies, that loss never really exists, but can still be taken as a loss for tax purposes, when it’s actually forgiven (and thus would be treated as income). For his supporters, the best analogy would be having a car repossessed. If you own more than the resale value, the car company is still owed money. At the end of the statute of limitations on that debt collection, they ‘forgive’ it, and write it off in the taxes, which the IRS counts as forgiven debt, or income (since you owed money, and now don’t, you effectively got a payment equal to the amount you owe) which is taxed. This can be abused via a system called debt-parking, which in this case is explained here, and that’s why his full records are important for disclosure. IRS officials auditing him only care that the numbers add up, no egregious deductions are taken, and that the correct paperwork is filed which agrees with similar paperwork. They don’t care that company A is a workaround, as long as A files the appropriate paperwork. It’s only when outside investigators, using information the IRS doesn’t have, or doesn’t bother with, that we get the true scoop.
A similar situation existed in New Jersey, when his (current) best bud Chris Christie took over as Governor, where Trump owed $30M to the state, and suddenly they settled for just $5M, a $25M hit for the citizens of NJ, but it helped secure Christie a place in Trump’s transition team (and who cares that he’s not doing the job he’s being paid $175,000/year to do in New Jersey, he is at his term limit, and only has one more year in office). How that write-down was covered in the taxes is something many would be eager to investigate.
Fifthly, there’s the issue of his ‘arrangements’ with his Foundation. Over the last few months, there’s been numerous examples of a practice called ‘self-dealing’ being committed by the Trump Foundation. That’s where the charitydoesn’t actually work in a charitable way, but exists as a tax loophole, to benefit the trustee or its major donors. The cheque to Bondi, purchases of paintings and sports memorabilia, paying legal costs and other such things with foundation funds rather than with the expected personal funds of Trump are all examples of this. More interestingly, he’s been pushing people to pay his foundation instead of him, potentially in an attempt to avoid paying taxes on it. The New York Attorney General has now suspended the Trump Foundation because it failed to obtain the needed paperwork (and quite simple paperwork at that — nor is it the first time extremely easy, and routine paperwork has been too much for Trump, leading to actions that violate laws).
A sixth potential is that there are items in his tax returns that would raise flags with other agencies. The IRS is a very confidential agency, by necessity, so its not big on sharing things. Paper corporations exist to shield identities, and with the sheer volume of work (the agency has 2/3 the employees it did 2 decades or so ago) their investigative time is limited. Other agencies (such as intelligence agencies, or tax entities in other countries) and investigative journalists as well as experts in other fields may be aware of some less-than-kosher dealings disguised by shell companies. He’s already been discovered to have done deals with Iranian banks that were on the naughty list, donebusiness with Cuba in violation of the Trading with the Enemy Act, and he owes over $650M in debt to the state-owned Bank of China (although he only claimed $315M in debt in his legal disclosure filing). And of course, there are significant ties to Putin and Russia, although investigations into that mess have been blocked by partisan Republicans in Congress, who are busy trying to castigate Clinton for the never-ending email saga in an attempt to influence the election. How many more payments to prohibited state payers, illegal or unethical ties to repressive regimes, laundered funding, or other international banking no-no’s are hidden in his taxes, disguised from the overworked and underfunded IRS? How can we trust that the person running for the office that handles diplomatic contact with foreign nations isn’t susceptible to blackmail by those nations, either by revealing illegal transactions, or seizing hidden assets (or even just plain old collecting debts, like that $650M one — how embarrassing would it be for the US President to have one of his buildings repossessed by a foreign state bank?)
Finally, the seventh and final reason is that it plays well to his base. They don’t care that he’s been an economic parasite on the country. That he thinks it’s ‘smart’ to freeload off his very supporters backs, because they don’t like the IRS. There’s a belief that it’s targeting conservatives (it isn’t, and wasn’t) and that he’s being victimized, when the reality is anything but. He’s busy playing the victim about being audited for the last number of years (he claimed 15) but that’s ok, because they’re “crooked”. Yet, by contrast, he’s claiming that Clinton being investigated all the time (and always by declared partisan interests) is why she’s so “crooked”. Why, then, is it too much of a stretch that he’s constantly audited because he’s strongly suspected of being a tax cheat (and there’s actual evidence for it) and he’s not a tax cheat? It’s double-standards from the same people that claim the government “steals their money at gunpoint”, despite that only being the case for minorities with minor tickets, not white people that owe taxes. Then again, Trump’s base do love to play the victim, even if it’s usually the victim of their own scheming and short-sighted actions.
You know what isn’t a reason to not release his tax records?
After all, what are you afraid of when you release your tax returns?
It’s like going skydiving, and remembering just as you’re about to just out of the aircraft, that you’re afraid of planes. Any audit that may or may not (remember, IRS, culture of secrecy as mentioned above) be ongoing will not only have no impact, restriction or cause for pause on releasing them, it’s already in progress. If people find out shady stuff, it doesn’t matter if the audit is in progress, or it’s finished, they can reopen an investigation at any time. There’s no mysterious double-jeopardy rule that says once you’ve been audited, anything they didn’t catch you get away with.
All these reasons and more are why it’s imperative that he release them. After all, what kinda person is so afraid of how rickety his house of cards is, that he needs to withhold his federal taxes when running for President?