Dana Chasin at 2020 Vision does a good job of encapsulating key issues that surface in the Democratic debates.
Let's get this out first: most listeners will admit that the debates seem both too long and too short, as mentioned on Stephen Henderson's Detroit Today program this Wednesday 1/15 morning. They are too short, because candidates are interrupted at the 30-second time limit and not allowed to develop nuanced, considered answers to questions. They are too long, because they go on for 2 hours. I'd add that they are problematic, because the media pundits have their own views of what creates energetic dialogue that makes good 'copy' for programming, versus the kinds of in-depth discussions about issues like climate change, health care, education, the Supreme Court, congressional oversight/checks and balances, tax policy, wealth inequality and income inequality, plutocracy and oligarchy, etc. that people want to hear.
One important distinction that Chasin notes for thinking about socio-economic programs is the distinction between means testing and universality. A means-tested program is generally available to lower-income people and often phases out and is capped at some income level beyond which it is no available. A universally offered program is one that is available to all, rich and poor alike. So the Earned Income Tax Credit is a means-tested program that is capped (too low, in my view), and Social Security is a universally available program (though there is a graduated payout scale and the funding formula caps pay-ins to the program at a ridiculously low level that means the rich pay only a pittance into the program)
As Chasin notes also, the right tends to reject universally available programs as having unreasonably high costs and allowing for free-riders. The left tends to favor universally available programs for ease of administration and--not noted by Chasin--for the collegiality and collaborativeness they can build in having rich and poor in a program together, where it cannot be dismissed as 'mere' welfare for the poor (which, as we know, often gets translated in the hands of the ultra wealthy like Mitt Romney into "handouts for 'takers' from 'makers')
Two points here about the two most progressive candidates, Bernie Sanders and Elizabeth Warren:
"Sanders is the strongest proponent of universality. ... Sanders has maintained support for universal healthcare (in the form of single payer, Medical-for-all), higher education, and social security expansion." (quoting Chasin in a 2020 Vision emailing)
Quote from Sanders at the debate: "My democratic socialism says healthcare is a human right."
"Warren's policy agenda includes programs that are both universal and means tested. Warren's healthcare and free college program are universal. Her childcare proposal is means tested. ... Warren stands apart from some of her rivals by providing explicit pay-fors, includer her two [per]cent wealth tax levied on the country's wealthiest households." (quoting Chasin in a 2020 Vision emailing)
Quote from Warren at the debate: "The lowliest millionaire that I would tax under this wealth tax would be paying about $19 million in the first year in taxes. If he wants to send his kid to public university, then I'm okay with that."
A week ago (Jan 8, 2020), the New York Times described Michael Bloomberg's plan1 for addressing the income and wealth inequality in the United States that has been a constant topic of discussion by Democratic candidates. Briefly, as with the robber barons of Teddy Roosevelt's age, the wealth of the global commerce titans and particularly the private equity fund buyers and sellers of companies (and layers off of employees) has exploded over the last four decades in the US, beginning in earnest with Ronald Reagan's presidency. Most of the benefits of productivity gains have gone to a very few people at the top, and the bottom 50% of the wealth distribution actually owns a smaller share of the nation's wealth than 40 years ago. The top 1% have gained enormously, and the top 0.5% have been even more enriched. We have ultra multibillionaires like Jeff Bezos who can pay $9 billion to his wife in a divorce settlement and still be the wealthiest man in the world with more than $130 billion in net worth. He earns about $78.5 billion a year (counting value of his Amazon shares) or more than $6.5 billion a month2 and thus exemplifies this new "gilded age" of ultrawealthy tycoons. This exists at the same time that the Trump administration proposes work requirements that will eliminate food stamp aid for 700,000 of hungry Americans and, with other initiatives, will take food stamps from 3.7 million beneficiaries who simply cannot get work that pays well enough to fund a sustainable lifestyle for themselves and their families.3 This will "save" the U.S. about $5.5 billion over five years--less than Bezos 'earns' in a month. This disparity--$5.5 billion to feed 3.5 million hungry Americans versus provide a month's additional wealth for a person already wallowing in wealth like Jeff Bezos--is why it is clear that the US needs to figure out how to respond to the inequality crisis in order to protect American democracy and ensure Americans have a decent standard of living.
Bloomberg's plan seems to be a moderate stance like Obama and Biden that attempts to focus on factors other than the wealth gap and the accompanying power gap that wealth provides. As the NY Times reports, he "frames the economic divide primarily in regional terms--and not along ... rich-versus-everyone-else class lines."1 The Times article notes that his plan is not unlike the charge Obama gave to Joe Biden for the Middle Class Task Force.1
Bloomberg's proposals for addressing the problem are similarly centered on things long discussed and tried that are difficult to do at a large enough scale to make any inroads into the inequality problem or the power gap problem. He is most definitely not proposing a wealth tax. His proposals include a focus on education and skills training, infrastructure projects, and entrepreneurial training centers. Although the GI Bill was a significant part of the post-WWII economic boom because it allowed vast numbers of returning veterans to get a college education, Bloomberg seems to be thinking more of apprenticeships and community colleges (training for a job) rather than university (training for a career and an approach to learning throughout life). The Times notes his interest in raising the minimum wage to $15 an hour, expanding the Earned Income Tax Credit, and encouraging unions while disallowing noncompetes for low- and middle-income jobs.
All those are minimal steps that any progressive candidate should take, but while they may have marginal impact on middle class mobility, they will not do much at all to ease the income and wealth gap that has been caused by technology, globalization, and financialization of the economy together that has measured success almost solely from stock market numbers and thus allowed corporate and private equity tycoons to garner the major gains in productivity over decades while paying their workers too little (or moving offshore to pay even less), combined with a tax system that privileges wealth, including, among a host of others, extremely favorable corporate tax provisions after the 2017 tax legislation, ridiculously low maximum rates on ordinary income, carried interest provision, section 1031 exchanges, section 1202 exclusion for gains on original issue small business stock, capital gains preference, and an absurdly low flat estate tax above a too-high exemption amount with a step-up in basis for heirs.
Bloomberg is a billionaire who is at least aware that the inequality in this country is problematic and needs to be addressed. But like most of the "have-so-much" class, he shows little interest in what is truly required--a shift in the direction of redistribution to balance the distorted seesaw of billionaires getting all the height and the rest sitting at the bottom. FDR's New Deal is said to have worked because the robber barons were scared that the proletariat would rise up in support of communism--the so-called 'red scare' behind the success of social security enactment. There may not be a red scare now (though the Trump campaigners try to paint democratic socialist programs as communism), but there is a real likelihood that the contrast--and possibly real class warfare-- between the squalor and despair of poor families who work hard but cannot fend for themselves and rich kids with silver spoons that only grow bigger and bigger may eventually threaten the global nation of the plutocrats.4
3 Phil McCausland, Trump administration proposals could cause millions to lose food stamps, NBC News (Nov. 30, 2019) (discussing proposed changes to SNAP program that would impose stricter work requirements, cap deductions for utility allowances and 'reform' the way states automatically enroll families when they receive other aid). See also
4. See, e.g., Chrystia Freeland, Plutocrats: The Rise of the New Global Super-Rich (2012) (described in The Guardian book review as "a necessary and at times depressing book about the staggeringly wealthy"). Freeland is neither Marxist nor socialist, and as I am reading the book, not evenappropriately skeptical of the amount of merit behind the plutocrats' self-claimed meritocracy.
The Republicans' proposed tax legislation--whether the House or Senate version--is despicable. It will exacerbate the already devastating income and wealth inequality in this country, leave the federal government without adequate funds for real infrastructure and social safety net needs, and place in almost inviolable power the wealthiest oligarchs of the country (and even the good ones exert a power that no one should possess in a democracy).
My previous posts on this so-called "tax reform" "simplification" package (it is neither) have outlined a number of pernicious provisions in the bills. There are a few I haven't mentioned, such as the likely inclusion of taxation of tuition benefits to undergraduate and graduate students. That will have an immediate impact on education and on basic scientific research. Not surprising, given Paul Ryan, Donald Trump, and Mitch McConnell's aversion to fact-based science and intellectuals, but nonetheless devastatingly harmful to the country in loss of prestige for our universities, loss of the top minds to other countries, and loss of entrepreneurial and innovational thinking that will hamstring commerce and productivity. Another is the "new" talk in the House of lowering the tax rate on the weathiest bracket by as much as two and a half percentage points--adding to the largesse for the wealthy otherwise larding the legislation and making it even more obvious that the only Americans the Republican Party sees itself as serving are those with at least millions and probably billions of net worth. The Republican charade of right-wing "alternative facts" (shown most clearly by the Treasury Secretary's inability to provide a supported rationale for the absurd corporate and oligarch-favoring tax cuts) would have a destructive impact on the entire U.S. economy. And it is not simplification--it is a huge complication that is ripe for tax abusers to abuse the complicated categories of differently taxed income.
But today there is a ray of hope that this tax scam might just not get passed --or might get turned around very quickly if it does get passed. Doug Jones' defeat of constitutional scofflaw and likely multiple-sexual-predator Roy Moore should cause any thinking Republican in the House and Senate to take a step back and listen to the views of constituents across the country, where dislike of this tax legislation is the majority view. The #MeToo movement and its impact on powerful media and other industry harassers, together with the fact that Democrats and Independents got out the vote in Alabama and defeated Roy Moore -- and another 20,000 likely lifelong Republicans decided to write-in another Republican name other than Roy Moore--should tell current GOP congresspeople that "the times they are a changin' ". Reaganomics--trickle-down, supply-side tax policies--don't work. Kansas proved that, if anybody actually had any doubt before. If the Republican majorities in the House and Senate pass this " Class War" tax legislation--written and argued and honed to a tee to serve the wealthiest multinational corporations and individual campaign donors while stabbing the middle and low-income classes in the back--they will potentially pay a big price at the polls in 2018 and 2020. They will pay that price because their tax legislation will send the U.S. economy into another tailspin that will lead to cuts in the standard of living of ordinary people so people like the Trumps can have even more gaudy gold faucets in their many mansions.
I call on everyone who can to write and call Jeff Flake (Arizona)--ask him to stand on principle and vote against the end of the Obamacare mandate, the giveaway to the wealthy and big corporations, the ridiculous scammable complication of different rates for the same income depending on what job the taxpayer worked at or whether the taxpayer owned the business or was an employee. Ask him to vote down this despicable tax legislation for the good of the country and ALL the people. Do the same for Susan Collins (Maine), who already has expressed real concerns about the impact of the elimination of the health insurance mandate. Even her 'bargained for' (but not actually promised) two-year patch wouldn't do much good: millions of people, the most vulnerable amongst us, will lose health insurance and therefore health care if this tax legislation passes. And let Bob Corker (Tennessee) know how much we all respect him for actually standing firm against this tax legislation travesty--and ask him to stand even taller by resisting the pleas to compromise principles 'just to get a win for Trump'. Let's push our Senators and Representatives to stand tall for a sustainable economy based on fiscal responsibility (don't create a $1.5 trillion dollar deficit) and distributive justice (don't push the middle class into dead-end living conditions) and end the giveaways to the wealthy oligarchs.
I predict that if this bill passes the expected accounting for the Republican Party will come even sooner and with even more strength against those who supported Trump's daily vitriol of falsehoods and the Trump Administration's filling the DC swamp with those who put pollution, despoiling the environment, destruction of the wilderness and national public lands foremost on their agenda.
As most everyone is aware, Trump has refused to release his tax returns, breaking precedent with decades of presidential candidates and president's release of tax returns. Even Dick Cheney, grumpy corporatist veep, released his tax returns. I had fun using them as the raw material for an introductory course in federal income taxation where we looked at the returns to understand how the various "lines" correspond to items specified in the Code (like "adjusted gross income" and "miscellaneous deductions").
Trump, however, used various excuses, none of them particularly strong, to say he "couldn't" release his returns. The main excuse was that his returns were under audit. Of course, that makes no difference whatsoever. Any taxpayer can release returns, whether or not they are under audit, and other presidential candidates (Nixon comes to mind) have done so during an audit period. Trump most likely didn't want to release his tax returns because he didn't want to provide fodder to critics who would look at the relatively measly amounts of taxes that he had to pay, or find information about trusts and other entities set up to keep money of shore or, who knows, find information about connections to various Russian oligarchs. Another reason that Trump likely hasn't wanted to release his returns--he wants to be able to pretend that he is not a beneficiary of all those many loopholes in the Code that particularly benefit the ultra-wealthy.
That comes to the surface now, because of his claims, in an Indianapolis speech, that he would not receive any benefit from the so-called "reform" tax "framework" put out by Trump and the GOP leadership. We know from 2005 returns that he has, at least in that year, had to pay $31 million in Alternative Minimum Taxes (AMT) in a year when he would otherwise have paid very little in taxes. That is, in fact, the purpose of the AMT--to force wealthy taxpayers to pay some tax on their incomes when they otherwise have the ability to take advantage of so many loopholes that they would get off pretty much tax free. So we know that Trump lied when he said in Indianapolis that he would not get a benefit from his own tax proposal. His tax proposal would eliminate the AMT backstop for wealthy payment of at least some taxes. That would directly benefit Trump. He lied.
Trump would also directly benefit from the elimination of the Estate Tax. That is a tax that is very low at this point, because of decades of GOP whittling away at it to reduce it to zero on behalf of their wealthy donors. When a married couple with $11 million in assets die, their estate would not pay any estate tax, because there is an exemption for the first $11 million for a couple. On the rest of the estate above $11 million (a size of estate of those in the top 1% of the distribution), the tax rate is now exceedingly low--only 35%. Trump's plan would reduce it to zero. He said in the Indianapolis speech that eliminating the estate tax would help middle class people, small family farms, and small businesses. He lied. Only the wealthy pay any estate tax (see above). Very few small businesses and family farms are subject to the estate tax at all--estimates say there would be only about 80 in a given calendar year at this point. Of those that are subject to it, the amount subject to the estate tax is only the excess over the exemption amount. And family farms get 14 years to pay off any tax like that the heirs might owe, through a provision for installment payment intended to help preserve family farms and allow them to pay the tax due, if any, over time out of the operating profits of the business. So, again, Trump lied.
Trump also would likely benefit huugely from the reduction of rates on corporations, through getting more dividends out of the even higher corporate profits that would result (to the extent that he has investments in corporate stock, which are likely substantial, since most of the financial assets in this country are owned by those in the very tip-top of the income and wealth distribution). So, again, Trump lied.
Trump would also likely benefit bigly from the reduction of rates on pass-through income from real estate partnerships and hedge funds. The Trump empire is clearly in real estate, and there are likely quite a few partnerships in the structure of the Trump companies. Since otherwise passthrough income is currently taxed at the individual partner's personal income tax rate, a 25% rate on income that would currently be taxed at a 39.6% rate (including the tax on investment income), is a 14.6% lower rate or more than a 1/3 reduction in the tax rate on the income. So, again, Trump lied.
Given that Trump distorts so easily the actual effect on him personally of his tax proposals, it would clearly be helpful to the citizenry to have a chance to review Trump's tax returns (and to have had them before the election to take into account as he talked about taxes and wealth). Every president has done so since the 1970s. Seventy four percent of respondents in national polls think Trump should release his tax returns. See McGuire release.
The California legislature has decided that if Congress won't act to do something about this, than it will. As Democratic Senator Mike McGuire, a proposer of the bill, noted in a June 1, 2017 release about the bill:
"Everyone knows that President Trump used the birth certificate issue against President Obama as a dog whistle to white supremacist groups,” Senator McGuire said. “The truth is that we have never elected a president who was not a citizen. That has never been a problem and does not require a solution. But we have elected a president – and he is currently in office – who has serious conflicts of interest that are endangering our national security and who is consistently violating ethical norms to enrich himself and his family. That’s a very serious problem which does require a solution – and the solution is SB 149.”
The legislature has passed a bill (Senate Bill 149, titled Presidential Tax Transparency bill), now apparently awaiting Governor Jerry Brown's action, that adds a ballot-eligibility disclosure provision requiring presidential candidates to release 5 years of tax returns. See Brandon Carter, California legislature passes bill requiring presidential candidates to release tax returns, The Hill (Sept. 14, 2017); CNN Wire & John Fenoglio, California passes bill requiring presidential candidates to release tax returns; Trump could be impacted in 2020, KTLA News (Sept. 16, 2017). The California secretary of state would make the returns public (with redactions as necessary) on the state website. Although it was mostly Democrats who supported the measure, the bill was bipartisan: some Republican members in both chambers supported the effort.
Expect a court challenge to the bill if Governor Brown does sign it into law. The challengers would argue that any additional restriction--even a ballot eligibility requirement--is unconstitutional, since it would add to the eligibility requirements in the Constitution. But the supporters would ably demonstrate that's a specious argument: every state has requirements that candidates must comply with to get on the ballot--mode for getting signatures, mode for making requests, timelines within which to comply, fee payments, etc. This tax return release provision is more similar to those (i.e., a disclosure requirement that is procedural in nature) than it is to the eligibility requirements of age, citizenship, residency set forth in the Constitution ("achievement" requirements that are substantive in nature). The substance on the tax return isn't relevant to whether a candidate can be on the ballot; just the procedural element of complying with the disclosure requirement. Constitutional scholar Laurence Tribe agrees with me that a disclosure requirement isn't an additional qualification (see KTLA News article for quote). And other states--New Jersey, Connecticut, Massachusetts, New York, for example-- are considering or have passed similar action.
Today's New York Times Op-Ed by Mitchel Zuckoff (a journalism prof at Boston University), titled "Why We Ask to See Tax Returns" (Aug. 6, 2016), at A19, goes beyond my list of reasons taxpaying voters may learn items of interest from reviewing presidential candidates' tax returns. Looking at the history of the tax return disclosure precedent and the way it adds value "as a measure of character", Zuckoff says outright what I merely hinted at in talking about tax scams--a presidential candidate could be a crook and taxpayers deserve to know!
It started with Richard M. Nixon, and Congress's July 1969 decision to eliminate what seemed like a gigantic tax-avoidance loophole that allowed sitting presidents to take large tax deductions for donating presidential papers to an archive. (For his historical information, Zuckoff references Joe Thorndike's paper for the Capitol Historical Society, JCT Investigation of Nixon's Tax Returns (Feb. 2016).) Congress observed, notes Zuckoff, that "a president's papers already belong[] to the public." As for Nixon, his 1969 tax return claimed a half million dollar deduction (quite a huge sum 47 years ago) for donating presidential documents 4 months before the law change.
When Nixon's deduction became public in 1973 (in connection with a Watergate-related lawsuit), it turned out that the donating deed was dated before the 1969 law change was enacted but was signed months after the change had come into effect (i.e., it appeared to be a backdated document intended to game the system to get the big tax deduction). At first, Nixon refused to release his returns and opposed any audit. The IRS at first "bowed to his wishes." But then someone leaked information to a reporter about how much Nixon had actually paid in taxes in 1970 and 1971, when he had income of almost half a million--less than a thousand dollars both years. As Zuckoff puts it, "He paid the equivalent of a family of three earning about $8000 in 1970 dollars."
This sounds a bit like the story of Warren Buffet paying a higher rate than his secretary, but worse. Or Mitt Romney, with his millions in income, paying at a rate of less than the preferential capital gains rate of 15%, but worse.
Eventually, the IRS did audit Nixon's returns. Eventually, too, Nixon gave in to the pressure from the press and released 5 years of returns in December 1973 and asked a congressional committee to review his gift of presidential papers. Eventually, Nixon resigned from office under threat of impeachment because of the Watergate coverup, and had to pay a considerable amount to the IRS.
And taxpaying voters lived happily ever after (until now), since every nominee since has released tax returns (except Ford, who released only a summary). So, says Zuckoff, "Nixon got it right: The American people need to know if their president is a crook."
In yesterday's post, Taxes, Government, and the Good Life, I noted the "long-term position of the GOP" in favor of downsizing government, which can be seen, at least in part, as a way to justify the GOP obsession with cutting taxes on the wealthy and on corporations (mostly owned by the wealthy). Worth exploring in that context is Eduardo Porter's article entitled "The Case for More Government and Higher Taxes," NY Times (Aug. 2, 2016).
Porter starts by noting the radical shift in the way Americans think about government. "Americans once appreciated the government that serves them. That’s long gone." He draws on research by the Pew Research Center showing that 4 of every 5 (or more) voters have said in the last 6 years that government makes them feel frustrated or angry.
That anger with government has become extraordinarily visible in this election season as one of the candidates for president has seemingly fed on the distrust and hate of a government whose leader's face is different from the majority white population. Most of us have seen this anger on the screen during the GOP convention, as Trump supporters--mostly white (only 18 out of almost 2500 delegates were black)--expressed their frustration with the societal changes that they see as leaving them behind and creating a world that they don't like. On the right, that is, the frustration with government seems to morph easily into vitriol, as Trump supporters openly condemned blacks and used violent expressions to talk about the first female presidential nominee of a major party, Hillary Clinton. (See, e.g., the video below "Unfiltered Voices from Donald Trump's Crowds"--warning: there is offensive speech here.)
Americans once understood that government allows people--through taxes, through voting, through volunteering--to create public institutions that could never exist if each one of us had to do it alone. Through government, we citizens as taxpayers can accomplish projects much larger than ourselves.
But the shift that Porter mentions has occurred over the last few decades, due, in large part, to the funded effort by various "think tanks" and high-powered, wealthy individuals in support of a larger goal of maintaining very low regulation on Big Oil, Big Pharm and other Big Business and ensuring very low taxation on rich individuals and the corporations they own and manage. The constant repetition of mantras that denigrate government persuade Americans that, as Reagan said while serving as the most powerful government leader in the world, "Government is the problem" or, as Rush Limbaugh said, it should be downsized until it can be drowned in a bathtub (paraphrasing). We constantly hear from the Fox News bloviators that the growth of government stifles the economy, that private enterprise is ALWAYS better than government at doing any job, that public employees should be fired--or at least not allowed to form unions that give them strength in negotiations, etc. Most of these statements appear without support--those on the right simply presume them to be true and are not very willing, in my experience, to delve into the actual facts to see if they support the presumption. And the push for deregulation and tax cuts for the benefit of the rich continues apace.
As we approach this November election, though, we should ask ourselves what evidence there is to support that mantra. Is it just a way to 'brainwash' voters into voting against interest? Is it just a way to ensure that the elite 1% continue to be able to get Congress to enact laws that favor them? Is it just a way to convince Americans that regulation is bad because the 1% doesn't want their ever increasing profits to be reduced one whit by fair wages sharing productivity with workers, or regulation that would protect the natural beauty of this great country while providing for a more sustainable economy?
Porter suggests a new book as a worthwhile reference on the topic: How Big Should Our Government Be?, by Jon Bakija, Lane Kenworthy, Peter Lindert, and Jeff Madrick. The authors, he notes, make clear the value of government and suggest that there are four important tasks for government facing us now.
“A national instinct that small government is always better than large government is grounded not in facts but rather in ideology and politics,” they write. The evidence throughout the history of modern capitalism “shows that more government can lead to greater security, enhanced opportunity and a fairer sharing of national wealth.”
"The scholars laid out four important tasks: improving the economy’s productivity, bolstering workers’ economic security, investing in education to close the opportunity deficit of low-income families, and ensuring that Middle America reaps a larger share of the spoils of growth."
The article includes a good graphic, available here, showing the importance of government to quality of life. Countries that have increased tax revenues as a percentage of GDP have achieved better GDP growth than the United States, which has enacted numerous tax cuts and kept government extraordinarily small (and also less innovative). As the blurb for the graphic says,
"Despite arguments that Big Government hinders economic activity, many countries where government has grown the most have also experienced stronger economic growth. Governments have grown across most industrialized nations — raising more taxes over time to offer more public services. In the United States, by contrast, the government remains virtually as small as it was 50 years ago."
Readers will want to look at the graphs accompanying the Porter article, available here, showing GDP growth versus tax revenue as a share of GDP from 1960 to 2013, and the change in tax revenue as a share of GDP from 1965 to 2014 for most OECD countries. (I was unable to reproduce them here, though the black point in the left graph below is the United States, and the thick black line in the right graph below is the United States.) These figures clearly show that the economic growth that the right claims to want to produce is in fact highly correlated with more government spending and higher taxes as a percent of GDP. Of course we want the taxes to be reasonable and the spending to be the right kind--public infrastructure and human capital, basic research that supports biomedical, technical and other innovations, etc. But blanket statements that smaller government is always better, that private enterprise always does things better than government, or that ordinary Americans are better served by "getting rid of" regulations developed to protect people and our environment--those kinds of ideological dogmas are simply ungrounded in fact.
We are now a few months from election day, when Americans across the country will go to the polls to vote for the person they think should be placed in the highest elective office in the land as president of these United States.
There are many reasons to hope that Trump is not the person selected.
His supporters seem to come especially from that group of white males who have experienced so much anger as their privileged position as the dominant group in society has given way to a more inclusive society in which women, the LGBT community, people of color and people of various religions are both more visible and more able to achieve positions of greater influence and power. Those Trump supporters are so eager to re-affirm their own self-worth that they apparently see in his rudeness, bigotry, narcissism, and bullying only his willingness to be confrontational to "powers that be", which somehow translates into their view that he will be a good leader. They cannot seem to see that, like most bullies, he uses confrontation, rudeness, impoliteness, bigotry and bullying as his defense against his inability to respond in substance to issues that are raised, that he grabs a wordbat and hits out against anybody, no matter how decent they may be, if they do not stroke his huge ego. As with all bullies, that is not a sign of strength but a sign of weakness. Worse, it is a weakness that provides a vulnerable target for shrewd autocrats like Putin in Russia who can use Trump's narcissism to manipulate him, as we've already seen in Trump's willingness to abandon NATO to cuddle up to Putin and to appease Putin for his aggressive annexation of Crimea. In all of this, we are left to worry how such an ill-tempered, poorly matured, unwise narcissistic and bigoted character could possibly make the difficult, nuanced decisions necessary of a powerful leader, especially when lacking in rudimentary knowledge about geopolitical, scientific, and economic affairs.
Trump seems to be claiming that we should think him suited for president because he inherited millions and maybe (he claims) amassed "many billions" more through a long-term pattern of stiffing and suing his suppliers, contractors, and workers--mostly ordinary working guys like the white men that have been bamboozled into supporting him-- in order to grab more money for himself. Along the way, he and his businesses went through six bankruptcies. Maybe one bankruptcy could be forgiven in a presidential candidate, and one big business failure could be seen as a life lesson that has the possibility of enriching experience and creating a more mature mindset. But six bankruptcies by a person prone to use litigation as a tool to avoid paying for work done appear to be just another way of stiffing the "little people" to whom Trump owes money.
It is in this context that Trump's refusal to release even one year of his back tax returns suggests that he knows they would look bad to ordinary Americans. So let's consider 1) whether Trump's excuses are worth giving any weight and 2) what kinds of information can be revealed by tax returns that would help us judge Trump's credibility as a candidate.
1. WHAT REASONS MIGHT TRUMP HAVE FOR NOT RELEASING TAX RETURNS?
a. There is no law that requires a candidate to release tax returns.
There is no law, but there is strong precedent supporting release. Many presidential candidates and presidents, including Republicans Richard Nixon, Ronald Reagan, George W. Bush, George H.W. Bush, George Romney, and John McCain, have released multiple years of returns. Trump's opponent, Hillary Clinton, has released many years of tax returns that are readily available online (see, e.g., Hillary Releases 8 years of Tax Returns, Politico, July 31, 2015; Hillary Clinton's 2007 through 2014 Tax Returns) and the Clinton Foundation's Form 990 is of course available.
b. Trump's most recent tax returns are under audit.
It is apparently true that Trump's most recent few years of tax returns are under audit (though of course we have nothing other than Trump's say so even on this), and this is the current excuse Trump relies upon for not releasing any of his tax returns. His campaign manager, Paul Manafort, told CBS This Morning on July 27 that "Mr. Trump has said that his taxes are under audit and he will not be releasing them." See here. He has suggested that when the audits are done, he will release but even that isn't certain.
Note, however, that there is no law that says returns under audit cannot be released: a taxpayer may release his own tax returns whenever he pleases. Commissioner Koskinen of the IRS has made clear that it is very rare for people to be audited every year (even for billionaires), and returns can be released by taxpayers while under audit.See here.
Moreover, Trump has many years of tax returns that are clearly no longer under audit, and the excuse doesn't apply to those returns. Even if he withheld (for personal reasons and not because of the audit) the last 3 years' returns, he should be able to release the 10 years before then.
Furthermore, there is no precedent for refusing to release returns because of an audit: Richard Nixon released his returns while they were under audit.
c. Trump's tax returns might provide some useful "trade secret" or other private, proprietary business information to competitors.
The concern about competitor's acquiring proprietary information is, of course, an argument made by businesses for maintaining the current rules regarding confidentiality of returns--ie, the rules that do not allow publication of filed returns or release to government officials other than as authorized by the Code. These confidentiality rules were put in place by the 1974 Privacy Act and the 1976 Tax Reform Act. They were in large part a reaction to Republican President Richard Nixon's Watergate mess and the discovery that the Nixon Administration had been using tax information as a tool against its "enemies".
Of course, these concerns about protecting taxpayers that gave rise to the confidentiality rules have little bearing on a taxpayer-candidate's release of his own returns for the voting public's benefit. Any truly important "trade secret" information could simply be redacted by the taxpayer for the release.
Furthermore, Trump has a habit of bragging about all his business ventures and how much money he claims to have made or contributed and even how well he has avoided paying taxes. He has continued to use the campaign context to promote his 'brand', so privacy on exactly these issues does not seem to be an important issue for him.
d. Trump's tax returns might reveal information about Trump himself.
It is undoubtedly true that release of tax returns does reveal information about the taxpayers, which is the main reason that the decades-long precedent of return release by candidates was established in the first place. That information is helpful to voters in understanding who the candidate is, how the candidate has operated, and what kind of stake the candidate has in this country (and other countries).
Trump's tax returns, while not all-revealing, would disclose information that is directly relevant to claims that Trump has been making on the campaign trail since the start of the primaries. The returns might provide further information about Trump's purported charitable contributions, income, extraordinary business success and other matters. They might even show that Trump "is deeply involv[ed] in dealing with Russia[n] oligarchs", according to George Will.
Odds are the real potential for the real information, whatever it is, to be seen as problematic by voters is the real reason Trump has not released his returns: he knows what is in them, and he knows how those facts match (or don't match) the many and varied claims he has made.
2. WHY IS IT IN THE PUBLIC INTEREST FOR THE PUBLIC TO BE ABLE TO REVIEW TRUMP'S TAX RETURNS?
a. Tax returns reveal the categories and amounts of income and losses that a candidate has reported.
Tax returns generally provide considerable information about how much income a taxpayer receives from various sources, or what activities have led a taxpayer to claim losses. Those categories and amounts of income and loss paint a picture of the taxpayer-candidate that can substantiate the image the candidate is trying to project or undermine it, depending on how honest and trustworthy that candidate has been in his or her self-description. If a candidate, like Trump, claims that he is qualified for the presidency because he is an enormously successful businessperson which has resulted in enormous wealth, then to the extent that tax returns reveal low income (even though there could be significant assets) that implies mediocrity or failure or much less wealth and business acumen than claimed, the candidate is revealed as untrustworthy, something that really matters to voters on the left and on the right, as evidenced by the growing distrust of "career" politicians.
Further, if a candidate's income is almost entirely from capital assets at the very low rate at which our tax rules currently tax income on capital, taxpayers can assess whether this person is actually capable of understanding the situations of ordinary taxpayers who work for a living rather than living off inherited wealth plus the kind of capital that builds on that inherited wealth, status, and connections. Remember that Mitt Romney's returns showed a very low effective tax rate (less than 15%) , which resulted in part from his gaining much of his income from tax-favored work in a private equity firm for which compensation is not taxed at ordinary income rates as it is for most ordinary workers.
Moreover, if a candidate's income is primarily from being paid for essentially licensing the use of his name without any real work attached (as apparently was the case with the profits to Trump from the so-called "Trump University" that sold itself as representing his chosen experts and his business wisdom when he apparently did not select any of the experts and the "wisdom" was a ten-year-old publicly available real estate investment manual, see, e.g., Trump University Lawsuit Advances as Judge Curiel Deals Blow to Donald, Huffington Post, Aug. 2, 2016 ), that fact reveals something about a candidate's character and ability to carry out the arduous job of president.
Finally, Trump has represented himself as having "huge" amounts of income annually and said that his "sacrifice" matching a Muslim couple's loss of their son in service in the U.S. military is earning millions through having a hugely successful business. (I'll leave readers to imagine what I think about Trump's ridiculously self-centered response to the Khan family's sacrifice). If in fact Trump's returns show relatively smaller amounts of income and project less success than the "yuuge" success he claims, the public could rightly conclude that the candidate has misrepresented himself to them. If a candidate lies about his wealth and sources of income, what else might he lie about?
b. Tax returns reveal the candidate's charitable contribution record.
Trump has claimed often that he gives away a lot of money for good causes, yet most investigative journalism has produced very little evidence that the claim is true. Trump had promised huge contributions from a January 2016 event he sponsored for veterans in place of participating in one of the primary debates, but didn't make his own promised $1 million contribution until late May after considerable pressure from the national press. See, e.g., At Least $1.9 MIllion in Donations Trump Collected For Vets Was Sent Last Week, NPR (May 31, 2016). Some investigative reporting on Trump's foundation suggests that Trump and the foundation have a "pitiful" record when compared to other billionaires like Gates, Buffett, and Bloomberg. See, e.g., Trump: The Least Charitable Billionaire, The Smoking Gun.com (Apr.12, 2011); Missing from Trump's list of charitable giving: His own personal cash, Washington Post (Apr. 10, 2016). Such behavior raises legitimate doubts about his claims of generosity.
Tax returns include the taxpayer's claimed deductions for charitable contributions. Does Trump give very little or 1% or 10% or more of his "yuuge" income to charity? Tax returns will tell.
c.Tax returns show (if reported as required) if a taxpayer has income from overseas accounts.
Robert Willens mentioned this in a Washington Post article as a potentially worrying thing for Trump: if he has "money parked overseas" he is supposed to disclose those accounts to the IRS. For someone who has claimed that he wants to see money invested in America, it would be a clear indication that his actions speak louder than his words if in fact he has moved money overseas.
d. Tax returns reveal something about the taxpayer's willingness to push the boundaries of reasonable tax positions.
Most ordinary taxpayers have little room to engage in transactions designed to lower their taxes. Most of us work at jobs where tax is withheld out of each paycheck, with a little more due or a little bit due back as a refund on filing. We may have more or less in charitable contributions one year or have large medical expense deductions in another. But we have neither the vast sums of money nor the expensive legal assistance to engage in transactions designed primarily to reduce our taxes.
Wealthy people routinely use sophisticated legal tax advice to get the lowest tax rates possible, to "milk the system to their advantage." Trump has bragged about doing so, of course, and that is not necessarily bad in itself. But tax returns can reveal (though depending on the detail released, it may be hard to see) whether a candidate goes beyond reasonably prudent tax planning to participation in shelters. If a candidate who says we should be investing in the United States moves his wealth out of this country to avoid paying taxes to the country that made that wealth creation possible, voters should care. If a candidate uses questionable tax dodges in his business or personal life, voters should care even more. If a candidate has engaged in some of the bogus tax shelters pushed by aggressive shelter promoters, voters should be outraged. If there is evidence that a candidate has submitted false information on a return (see new evidence that Trump Didn't Pay Taxes, Drudge Report (June 15, 2016) (reporting on two tax appeals lost by Trump in the 1990s in which (i) he claimed expenses but not related income and (ii) apparently filed a return signed by someone who stated he had not prepared the return), voters should care deeply about what that would mean in the office of the President.
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In conclusion:
It's worth remembering that Trump's position during the 2012 campaign was that Romney should release his tax returns and that he, Trump, would have no problem doing so because "it's a great thing when you can show that you've been successful, and that you've made a lot of money, that you've employed a lot of people. I actually think that it's a positive." (See the video at this link for this January 30, 2012 Fox & Friends statement by Trump.)
Back in the 2012 campaign, he also said he would (maybe) release his tax returns when Obama released his birth certificate. (See the video below for this interview with Stephanopoulos.) Beyond the fact that such a condition (a sitting President's release of a second, full-form birth certificate) is irrelevant to the release of tax returns, of course, Obama did release his full long-form birth certificate to quell the stupid controversy Trump manufactured out of thin air, so that excuse is just as flimsy as every other one. Trump hasn't released his tax returns.
When push comes to shove and it is Trump's turn to release his returns, he has come up with only flimsy excuses and bombast. He's clearly depending on his campaign methodology of attacking all those who press him on issues and defying common rules of courtesy to carry him through. Voters shouldn't buy it. We can learn a lot about a candidate from reviewing his tax returns, and what we learn is very relevant to that person's qualifications for the presidency. If Trump doesn't release those returns soon, it leaves us to assume that there is something really negative in them in respect of the picture he has tried to project of himself as a successful, wealthy, and generous businessman who can get things done.
Addendum: Worth noting on this topic is Michelle Ye Hee Lee's August 1, 2016 article in the Washington Post, What we know about Donald Trump and his taxes so far. It includes some information from the 1970s and 1980-90s (including the two tax cases mentioned above).
In an extraordinarily frank breakfast exchange with journalists, Bernie Sanders answered a number of questions about his views and the direction he thinks the country needs to move. As usual, the press tended to ask "horse-race" questions rather than substantive ones. But Sanders responded with substantive answers, not the "gotcha" answers (about other candidates) that journalists' questions encourage (and that many politicians seem quite satisfied to work into their press encounters).
Having indicated that he thought it was time the US made some progress towards meeting the needs of ordinary working Americans, such as universal single-payer health care along the lines of our current Medicare program for seniors, and maternity/paternity and medical leaves for ordinary wage-earners, Sanders was asked if he would pay for those benefits, at least in part, with higher taxes. He answered forthrightly that taxes would need to be increased, especially for the extraordinarily wealthy and corporations. He noted the immense inequality that ordinary Americans face today, an inequality that steals away opportunities and makes daily life a hard grind for so many people. Just twelve (12) of the richest Americans saw an increase in their wealth over the last two years of a whopping $154 billion--that's more than the entire wealth of a majority of Americans. Corporations offshore their assets and avoid taxes with "rent" profits accruing to them while, again, ordinary Americans don't even get decent living wages. Hedge and equity fund managers who benefit from the "carried interest" loophole generally pay a lower rate of taxes than truck drivers. See, e.g., Sanders' website post on how the richest .0001% pay their taxes. These privileged elites need to be asked to step up to the plate and pay their fair share to support necessary programs.
As to specifics of how those taxes should be increased, Sanders noted that he hoped to release a tax reform proposal soon. It would include, he said, a transaction tax on Wall Street business, an end to multinational corporations' ability to avoid taxes through moving business into tax havens, and a more progressive income tax (see, e.g., this post on his website).
I will add here that these are many of the reforms that this blog has argued for over the years. Clearly, the right-dominated tax cut regimen of the Reagan years, the Gingrich Contract on America, the absurd Grover Norquist "never a tax increase" pledge, and the numerous revenue reduction acts passed in the Bush I and Bush II years--and of the Republican-dominated Congress and state houses during Obama's presidency--has been one of cutting taxes for the rich and big business and increasing them (if finally deemed necessary to increase revenues after cutting spending past the bone) on working people through regressive payroll, sales and excise taxes. It is time for us to return to a truly progressive tax system that asks as much of the rich as it does of the working poor.
Watching the hour-long exchange is well worth your time. It is also surprisingly refreshing to see a politician respond carefully and thoughtfully with forthright answers that do not pander to billionaire interests or Wall Street.
There is class warfare going on, right now, all across this country. It's highlighted by the election gimmicks and gambits of those on the right who claim to be supporting ordinary Americans but whose real intentions show in the results. And it is ultimately a sad statement about Americans' understanding of what is required for a sustainable economy that supports decent lifestyles for all.
Let's start by looking at the maps resulting from studies of well-being that identify the states where people are not at all well-off, such as the 2013 survey done by Gallup Healthways, available here. Those poor states are the reddest of the red belt in Mississippi, Tennessee, Florida and elsewhere across the Deep South--places where I grew up in a decidedly Republican household that bought the GOP economic fallacies hook, line and sinker, and places where today's populations are worse off in terms of the various measures of economic well-being and happiness than the more progressive northeast and west.
Isn't it likely that the anti-government, low-tax and pro-wealthy/pro-big business policies of the GOP politicos that have run these states for several decades have something to do with these negative results, and that the more progressive policies in the northeast and northwest are reflected in the much more positive results in those areas?
Yet rural, southern populations continue to proudly proclaim their allegiance, against their own economic interest, to ill-fated Reaganomics that favors tax cuts (for the wealthy and big business) coupled with use of old-time, regressive consumption taxes (toll roads, sales taxes and property taxes), privatization of public functions (e.g., charter schools managed by for-profit, nontransparent corporations), socialization of losses, militarization, and de-regulation.
The results are harmful at national and state levels, as those same right-leaning voters suffer from poor K-12 education, low-quality public services including neglected roadways, nonexistent or outdated public transportation systems, inferior safety nets, inferior health results, lower literacy rates, higher teenage birth rates, less access to universities, and, yes, fewer and lower-paying jobs.
Of course, those in the top 5% like to think of themselves as suffering, and therefore see any demands for increased minimum wages (that they consider cutting into their ability to capture more and more (rentier) profits beyond their already unreasonable percentages) as "class warfare." See, for instance, this Wall Street Journal video "Do You Make $400,000 a Year But Feel Broke?" from September 5, 2014 depicting the purported hard times for a couple in Chicago making $400,000 a year, buying a $60,000 car every four years, paying a mortgage on a $1.2 million house along with $25,000 a year in maintenance and , entertainment ($10,000 a year) going on vacations ($25,000 a year), club dues ($12,000 a year), and paying for their children's sports ventures ($10,000 a year). These and other "necessities" and (purportedly reasonable) discretionary expenditures take all of their after-tax money.
Given that perspective, no wonder those in the top have so little consideration and sympathy for ordinary Americans who have incomes in the $50,000 to $60,000 range, much less for the poor who struggle to put food on the table and heat in the furnace! They can't even imagine such limited lives. With the growing inequality in this country, the gap between the upper class and the rest of us is increasingly wider.
Outside the sphere of political debate, you also see the real world impact of inequality. Merrill Lynch recommends an investment strategy to its clients based on the growing economic clout of plutocrats, Singapore Airlines is now selling $18,400 first class cabin tickets, and observers think Apple is going to start selling a $10,000 watch. Conversely, Walmart is now primarily worried about competition from dollar stores. The executives at these companies are not hysterical liberals trying to drum up paranoia about inequality, they are trying to respond to real economic conditions — conditions that have entailed very poor wage growth paired with decent returns for those proserous enough to own lots of shares of stock.
The ability to care about those so distant from the well-heeled in-group appears to be diminishing as the gap between the well-heeled and the rest of us widens. Those super-wealthy corporate managers and CEOs and super-rich shareholders are not likely to recognize in themselves the greed and exploitation of others that their excess returns on capital represent. As Mitt Romney made so clear, rich folks (i) think of themselves as "meriting" their outsized incomes, in spite of the fact that they often start out with silver spoons and garner greater returns than ordinary folks simply because they have larger capital portfolios to start with and can't possible achieve a level of productivity of 100s times that of ordinary workers, as current CEO pay-levels claim under "free market" theory; and (ii) find it much easier to blame the misfortune of ordinary Americans on their purported laziness and "lack of personal responsibility." (See earlier Taxing Matter posts on Romney's self-justifying 47% remarks during his presidential campaign.)
But that means the rich (and the GOP most closely aligned with big business and big capital) often support policies that can only lead to greater income and wealth inequality, fewer and fewer Americans able to enjoy a decent, sustainable lifestyle, and the growth of a very small oligarchic elite. Those policies include making it harder for poor people to vote (justified on the basis of non-existent voter fraud), making it harder for middle class and poor people to go to college (less state monies to universities, less grants and more (profitable-for-big-banks) loans), making it harder to support a family (less public transportation, lower wages, more jobs outsourced, refusal to fund Medicaid expansion, yammering for the repeal of the Affordable Care Act even though the US's market-based health care system is less efficient, more costly, and lower quality than single-payer systems in most other advanced countries), etc. The long-run result of these pro-elite pro-corporate policies may well be social chaos, as the rich oligarchy faces off against a suffering and shrinking middle class and a grievously disadvantaged lower class. That may not be so far away as many of us once thought, given the rapidly growing wealth inequality and the more radical right-wing policies that have moved into the GOP mainstream in the form of Rand Paul and other free-marketarian extremists who denigrate government and want to remove the social-economic safety nets put in place under the New Deal.
They denigrate government, that is, except when they recognize that they need it, such as when the ebola crisis erupted. Suddenly, they want a Center for Disease Control that really functions well, even though they have pushed government spending down. And they want a TSA that can screen arriving passengers, even though they hated the TSA before. And they wanted the President to appoint an "Ebola Czar", even though they scoffed at the idea of administrative officials appointed to oversee important areas before. They want a vaccine for ebola, but they have made it much harder to accomplish because of their constant push for "reducing government" and cutting research funding (making one of their pet projects to seek out what they think are silly projects that have been funded by the federal agencies).
The free market, in other words, is claimed to be the be all and end all -- until push comes to shove and it is obvious that market forces require government intervention.
Consider the compaign for governor here in Michigan. In his ads, current GOP governor Rick Snyder claims to be a hands-on non-partisan fiscally responsible type who cares about everybody in Michigan. Those ads brag about how Snyder cares about senior citizens and education --using the (meager) increases in "meals on wheels" to claim that Snyder has made life better for senior citizens, and the state's increase in support for purportedly public charter schools. Behind that facade of political PR is a deeply partisan governor who has consistently supported the elite rich capitalists over the majority of Michiganders who are ordinary salary earners working hard (or working hard to find work).
Snyder signed a "free rider/right to freeload" bill permitting non-union workers in a unionized environment to free-ride on union contracts without paying their share of the costs of the contracts they benefit from and prohibiting unions from using paycheck deductions to collect union dues. That kind of legislation, sought by the elite owners of capital who benefit from paying lower non-union wages, is (mis)labelled by the pro-wealthy right as "right to work". It is really a "right to freeload" law since the union rules it replaces never required anyone to join a union and always allowed workers who benefitted from a collective bargaining agreement to pay only the 'fair share' payment of the considerable costs of negotiating an agreement and supporting workers in grievances rather than support all union activities. As a result, workers can now pay nothing yet call on the union whenever they have a grievance against their employer. The goal of such laws is to eliminate union support for workers and thereby increase the power of capital owners, so it is particularly sad to see how many workers are fooled into supporting these "right to freeload" laws.
Snyder supported Michigan legislation that gave big businesses a huge tax cut, while supporting another bill that gave seniors a huge tax increase by taxing their (often meager) pensions. No wonder the wealthy who own most of the financial assets in the country and benefit from the decades of lobbying by right-wing propaganda tanks against buinsess and capital taxation think he's a good friend.
And of course, much of Snyder's 'support' for education has been cuts to state funding for Michigan universities (especially Wayne State, which serves the predominately Democratic southeastern region of the state) that has affected the state's economy in real ways, as students have to pay more of the cost and universities have less funding for research that directly impacts economic development. Snyder has also supported an unprecedented increase in charter schools in a system that provides no accountability, doesn't provide improved educational results, and siphons off public dollars for private profits, through the mechanism of private charter management corporations that run the purportedly "public" charter schools.
Snyder doesn't think we need increases in the minimum wage, and his administration has generally shown little interest in figuing out how to help minimum wage workers revive from the Great Recession. For example, his administration has done nothing to deal with the myriad fly-by-night companies that cheat workers coming and going on wages.
ASIDE: Here's one real-life tale illustrating the problem. I know personally of a man in Michigan hired by a Michigan-registered cleaning corporation that had contracts with at least two major national corporations to clean stores in southeast Michigan. The cleaning company claimed that the man was "in training" and therefore not required to be compensated after two weeks of full-time working for the company, including being locked inside a cavernous store overnight to do a major cleaning job. The company refused to pay for the next two weeks, claiming that "corporate headquarters" had made an error and would straighten it out in the next paycheck a month later. The man ultimately was paid only a couple of hundred dollars for that entire month, because the company produced a purported check stub showing a paycheck even when the man representing the company acknowledge that paycheck had never been issued to the man. The company paid the man on a "piecework" basis for cleaning stores, claiming that a 30,000 square foot store with public restrooms could and should be cleaned for $25(that's mopping, vacuuming, and cleaning toilets) and that the work could be done in one hour! The company required the man to pick up cleaning equipment and the company van at the "corporate headquarters" (many miles from his home and many miles from each of the stores to be cleaned) but claimed that it did not have to pay the man for the 3-4 hours per day that he had to spend to drive the company van and equipment to and from various worksites. The man quit, but has never gotten the company to issue the paycheck that he never received and has never received pay for the many hours spent working for the company moving its van and equipment.
This is election day. We decide today whether to give President Obama another four years to complete the turnaround from the budgetary mayhem and Great Recession created in large part by the "Cut Taxes for the Wealthy and Spend on the Military" policies of George W. Bush.
Romney hopes that instead we will trust his know-it-all posture of noblesse oblige--the wealthy guy who claims, without specifics, that because he got rich (at a vulture capitalist enterprise where he enjoyed firing people), he simply "knows how" to take care of the economy. Taking care of the economy, of course, means that he will cut taxes even more (especially for the wealthy) (yet claim to balance the budget, without giving us specifics); spend even more (like by increasing military expenditures and perhaps even getting us into another war, this time with Iran); privatize (he calls it "reform") Social Security and Medicare so the big banks can make the profits and the vulnerable elderly can be left paying for more of their already outpriced medical care and having even less retirement income with which to do so. Romney bases it all on his vulture capitalism experience of making millions supported by government tax subsidies (the preferential rate for carried interest compensation income) and government risk-underwriting (the preferential treatment of financial institutions, and thereby the lower costs of funds for those engaging in the financialized economy's "enterprises" such as hedge and privatge equity funds), combined with the use of "other people's money" in the way private equity uses debt, not the fund managers' actual funds, to buy the businesses and pay themselves big profits whether the businesses succeed or go bankrupt (and no matter whether the workers are mostly fired and their jobs outsourced to other countries). Remember that Romney is the guy that enjoys firing people.
He wants us to trust him on all that, with no specifics that might allow people to understand that his program can't work, just like he thinks we should trust him on what we know about his taxes from the pitiful two returns that he provided. He knows he didn't provide enough for us to assess a good bit about his return: passive versus active income requires more years to assess; hobby losses versus business deductions require more years to assess; and of course use of shelters is made much clearer when you've got more years to look at. (And if he engaged in the voluntary disclosure program for his offshore account, he certainly wouldn't want anyone to know about that.) Trust him for his "I know how to do that" bragging, when he won't even release 10 years of tax returns like every other candidate? That says it all.
Well, maybe it doesn't say quite all. There's the little matter of how often his campaigning has slipped away from the facts. The truth, it seems, doesn't matter much to "etch-a-sketch" Romney. The campaign seems to think it can gloss over, or simply state the opposite of the facts frequently enough and pull the wool over enough voters' eyes to win the election. See Kevin M. Kruse, The Real Loser: Truth, New York Times (Nov. 6, 2012), at A25.
PolitiFact has chronicled 19 “pants on fire” lies by Mr. Romney and 7 by Mr. Obama since 2007, but Mr. Romney’s whoppers have been qualitatively far worse: the “apology tour,” the “government takeover of health care,” the “$4,000 tax hike on middle class families,” the gutting of welfare-to-work rules, the shipment by Chrysler of jobs from Ohio to China. Said one of his pollsters, Neil Newhouse, “We’re not going to let our campaign be dictated by fact checkers.”
... [N]othing in [the Obama campaign] — or in past campaigns, for that matter — has equaled the efforts of the Romney campaign in this realm. Its fundamental disdain for facts is something wholly new.
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