Blog on the Run: Reloaded

Wednesday, March 15, 2017 8:20 pm

Rachel Maddow and Trump’s 2005 tax return (redux)

Immediately after Rachel Maddow’s show ended last night on MSNBC, I jotted down a few thoughts on Facebook, which follow:

1) Maddow tweeted she had “returns,” plural. That implied she had both full returns and multiple years. Neither was true.

2) We learned not much substantive from one year’s 2-page Form 1040. Without the schedules, we don’t know WHERE he got his income, which is much the more important question.

3) The long intro at the top of the show ground on a lot of people’s nerves, including mine, and for people who don’t watch Maddow regularly it probably was almost unwatchable. But she often has long intros that serve valuable purposes. In this case, it was valuable for two reasons: to provide background to low-info viewers, and to suggest future avenues of inquiry for other reporters.

All of that said, this was a 30-minute segment that someone unwisely stretched into an hour.

4) It’s a start. It’s a bloody start.

I had more thoughts, but I also wanted to go to bed, so I did. The additional thoughts follow, in no particular order:

While I’m sure MSNBC scored high if not record viewership on Maddow’s show last night, it did so at the cost of a big chunk of its credibility. It grossly overhyped what it had in terms of substance. Although Maddow (or the $25,000-a-year production assistant who actually runs her Twitter account) tweeted only twice before the show started, as noted in Point 1 above, even she implied that she had more substance than she really did. Maddow’s unspoken schtick has been that her show isn’t like the rest of cable news. That schtick took some big hits below the waterline last night.

Although I am not confident that Johnston’s source for his copy of the Form 1040 was Trump himself, as Johnston suggested it might have been, the two pages almost certainly were sent to him with Trump’s knowledge. (Johnston explains here how he got the return.) It smacked of what the Watergate-era Nixon folks called a “limited, modified hangout,” meaning they would admit to the absolute minimum truth that they could admit to without further damaging themselves. Because, after all, what did we learn about this? Trump earned about $153 million and paid about $37 million in taxes. Those numbers aren’t abnormal for people presumed to be rich. So for a lot of low-info viewers and voters, this release was the equivalent of Trump saying, “Here, see? There’s no THERE there! Lying media! Fake news! Thorax!” And a lot of those people will believe that. (More in a bit on what else we learned, most of which will fly over the heads of low-info viewers despite Maddow’s best efforts.)

Johnston’s own reporting on the Form 1040 is much less breathless and more substantive. Among his findings and observations:

  • “Donald Trump was paid that year like a member of the 0.001%, but he paid taxes like the 99%. And by at least one measure, he paid like the bottom 50%.”
  • “There is one clear expense, however, that can be discerned because portions of Trump’s 1995 state tax returns became public last fall. Trump got out of repaying nearly $1 billion he borrowed for his failed casino business. When you don’t repay a loan Congress says that money is income and you owe taxes on it immediately. Instead, Trump made use of an abusive tax shelter that Congress soon closed to newcomers. Like magic, the tax shelter converted what should have been a tax bill of about $360 million into future tax breaks. Ten years later, on his 2005 return, Trump was still saving tax dollars thanks to that tax shelter.”

Johnston also finds that the only reason Trump paid as much in income taxes as he did was because of the Alternative Minimum Tax, which he has said he wants Congress to abolish — a move from which he would benefit directly. And, he says, the return tells us more about the $916 million tax write-off contained in his previously-released 1995 state tax return — the write-off that led to suspicions that Trump had paid no income taxes for 18 years thereafter. Johnston explains it like this:

To understand the Trump tax returns it’s important to realize that America has two income tax systems. The regular income tax was supplemented by a parallel tax system, signed into law by President Ronald Reagan in 1986, called the Alternative Minimum Tax or AMT.

How these two systems interact is central to understanding the Trumps’ taxes.

Viewed in terms of the regular federal income tax system, here is what Trump did:

Trump reported $152.7 million of income. He also reported $103.2 million of negative income, the remainder of the roughly $918 million tax shelter he bought in 1995. That deal was disclosed earlier in three summary pages of his 1995 Connecticut, New York and New Jersey state income-tax returns.

That Trump had only $103 million of his $918 million tax shelter left in 2005 also tells us something about his past income. Using up the other $815 million of negative income in the tax shelter indicates that he earned an average of $81.5 million annually during the 10 years from 1995 through 2004.

Deducting the negative income lowered Trump’s adjusted gross income or AGI to $48.6 million. AGI is the last figure on the bottom of the front page of a federal tax return.

From that, the Trumps took $17 million in itemized deductions, which are not specified. That left  $31.6 million of taxable income.

The Trumps paid just $5.3 million of regular federal income tax. Measured against their cash income of almost $153 million their federal income tax rate was 3.48%.

That figure is slightly lower than the tax rate paid by the poorest half of Americans. The half of taxpayers whose income was less than $33,485 that year paid 3.51% of their money in federal income taxes.

Trump’s total federal tax bill was larger, though, because of the Alternative Minimum Tax or AMT.

The President, in writing, has called for eliminating the Alternative Minimum Tax. Now we know one reason why—he lives like a king, but wants to pay taxes like a Walmart cashier.

All high-income Americans must calculate both their regular income tax and their AMT income tax and pay whichever is larger.

Most of that $103 million of negative income was ignored under the AMT, which meant that for tax purposes Trump’s income was larger than under the regular system.

The Trump income subject to AMT was $111.7 million, according to Daniel Shaviro, a New York University law professor who as a Congressional staffer helped draft the AMT three decades ago.

The Trumps paid $31.3 million in AMT which, together with the regular tax, made their total federal income tax $36.6 million.

Viewed in terms of their positive income of almost $153 million the total Trump tax bill came to 24%. That’s in the range paid by two-income career couples who both work all year to earn about $400,000. The Trumps income was $418,460 per day.

So Trump is, to be kind, manipulating the tax system to pay a lot less tax than a person earning as much as he might be expected to pay. But you know what? A lot of rich people do that. It shouldn’t be legal, but it is, and it probably always will be as long as rich people are the only ones writing the tax code.

Still, this wasn’t a non-story. Seth Abramson, in this thread on Twitter, wrote last night that we actually learned some other important things:

  • We got confirmation that Trump has been lying about not being able to release his 2005 and other returns because they’re being audited.
  • We therefore have reason to believe that if the White House has reason to think other returns might be released soon, it may do so on its own.
  • Someone, somewhere who had access to at least some part of Trump’s tax returns was able and willing to send them to a reporter, with or without Trump’s knowledge. (And I would add that he knew to send them to Johnston, perhaps the most qualified reporter on the planet to address them.)
  • Maddow’s and Johnston’s publication of the return proves that the press is willing and able to publish the material despite allegations that doing so is illegal. (The 1971 Supreme Court case on the Pentagon Papers backs this up, by the way.)
  • Trump made only $150 million or so in 2005 despite the housing market’s still being way up at that point. (I have said all along that Trump’s claim of a $10 billion net worth is bullshit; Abramson thinks this return confirms my suspicions.)
  • Trump may have lied to the FEC at some point, which would be a crime. (Maddow touched on this too last night, but I admit she was talking so fast I wasn’t clear on the details.)
  • The White House now has a “tell” that the press and public can use to gauge its responses to any future revelations regarding Trump’s taxes: “The WH’s willingness to talk about this return sets a standard we can use later on if/when the WH balks at discussing other returns. Indeed, the moment the WH reacts differently to the possible release of a tax return than it did tonight, we’ll know something’s up.”

One last thing: My friend Dan Romuald wonders whether the White House might have made a copy of this one particularly nonthreatening 1040 available to certain White House staffers suspected of leaking to the press, to see whether they could catch a leaker in the act. That, too, is possible and would not be out of character for this administration. I like my modified-limited-hangout scenario better. But that’s just a gut feeling. I could be wrong.

So where do we go from here? In search of more tax returns — the whole things, not just the two-page summaries. I would not encourage anyone to do anything illegal to get them, but in the unlikely event Congress gets sufficiently incensed, that wouldn’t be necessary: Congress, as we saw during the Clinton and Obama years, can subpoena anything it damn well pleases and probably get it. And if more news outlets get returns in their mailboxes with no return addresses, they need to publish them (after verifying their authenticity, of course). It’s perfectly legal and it would be a huge public service.

Because at the end of the day, there’s still a huge question hanging over this country: To what extent do our so-called president’s financial and political ties to the Russians allow Russia undue influence over American policy? Keep in mind that 1) for all Trump’s praise, Vladimir Putin is and always has been a dictatorial, murdering fuckhead (to quote Eddie Izzard), and 2) the Russian government, the Russian banks and the Russian Mafia are all pretty much the same thing.

Trump’s tax returns — in full, all of them — would be the quickest, easiest way to answer that overarching question. And I’m not the only one willing to bet dollars to doughnuts that that’s why he has been keeping them hidden.

 

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Wednesday, February 20, 2013 10:00 pm

Driftglass summarizes “Hubris” for you because I had to study

This is just a taste. And I am grateful to him for the service (which was live-tweeted, thus the weird diction/syntax in places; also, I did a quick search-and-replace on some of the more vapors-inducing participial adjectives):

  • Remember David Brooks’ column calling people who opposed Wolfowitz antisemitic? No? That’s the firetrucking problem.
  • Remember David Brooks’ columns mocking Liberals who opposed Iraq war as deluded Bush-deranged posers? No? That’s the firetrucking problem
  • Remember David Brooks calling people cynical assholes who objected to Dubya’s flightsuit tango? No? That’s the firetrucking problem.
  • Remember when the collaborators at the NYT gave a firetrucking weekly column to Bloody Bill Kristol? No? That’s the firetrucking problem.
  • Remember when David Brooks leveraged his Liberal bashing tripe into a column-for-life at the NYT? No? That’s the firetrucking problem.
  • Remember Steve Gilliard? No? That’s the firetrucking problem.
  • Remember when the wingnutosphere went nuts trying to discredit every alarming report out of Iraq? No? That’s the firetrucking problem.
  • Remember when palette-trucks of shrink- wrapped taxpayer cash just firetrucking vanished into Iraq? No? That’s the firetrucking problem.
  • Remember when everything that is now settled history was America-hating surrender-monkey treason? No? That’s the firetrucking problem.
  • Remember when a gay hooker Conservative “reporter” w/ a fake name sat 100 ft away from Dubya for 2 yrs? No? That’s the firetrucking problem
  • Remember when Halliburton made $$ selling American soldiers in Iraq toilet water? No? That’s the firetrucking problem.
  • Remember when the GOP made “[Forget] Reality” into American national policy? No? That’s the firetrucking problem.
  • Remember when Phil Donahue got fired for telling the truth and Conservatives got promoted for lying? No? That’s the firetrucking problem.
  • Remember how the Cheney clans got really, really rich sending kids off to die for their lies? No? That’s the firetrucking problem.
  • Remember when 60 million Americans re-elected these deficit-creating war criminals? No? That’s the firetrucking problem.
  • Remember the incompetent children of GOP campaign contributors were put in charge of governing Iraq? No? That’s the firetrucking problem.
  • Remember when Fox News told soldiers rolling into battle to look into the camera and say “Fox Rocks!” No? That’s the firetrucking problem.

You know, I stack this list up against the whining from Politico reporters that I mentioned below, and I think perhaps I should call Mike Allen or Jim Vandehei at Politico and tell them, “There are better ways you could be spending your time, and some pseudonymous blogger in flyover country has just handed you a double fistful of them for free, so pack a lunch and get busy.

That, also, is the polite version. Too. Here’s kind of what I really feel like saying.

Thursday, March 22, 2012 8:52 pm

Quote of the Day

Filed under: Evil,Journalism — Lex @ 8:52 pm
Tags: ,

From Rachel Maddow, and, dear God, I wished more journalists had the stones to call this what it is. Speaking on the Mitt Romney/Etch-a-Sketch fiasco, she said (at about the 6:30 mark):

http://www.msnbc.msn.com/id/32545640

Visit msnbc.com for breaking news, world news, and news about the economy

In the general election you don’t have to be any one ideological thing in order to win over the country. But you have to not be a liar. Here’s how else Mitt Romney is like an Etch-a-Sketch. It’s not just speaking French. It’s not just outsourcing jobs to China. It is not just fudging  his conservatism. It’s fudging everything, all the time. And this is hard to talk about in the day-to-day news context because there are such low expectations for politicians’ being truthful and because the word ‘lie’ is both underused and overused to the point where everybody’s a little touchy about it. But the degree to which Mr. Romney lies — all the time, about all sorts of stuff, and doesn’t care when he gets caught — is maybe the single most notable thing about his campaign.

If the Republicans want to make this presidential election about character and not about the economy and jobs and the endless war in Afghanistan and the rising ocean and shrinking window for doing anything about it, well, then, let’s have that conversation.

And as we do, let’s remember that the three most important rules of political journalism are 1) Look at the record, 2) look at the record and 3) look at the record.

Obama has let me down, to the point at which I publicly called for his impeachment more than two years ago. But the reality for a long time has been that in the system we have, the best we can hope for is the lesser of two evils.

On top of that, Obama has carried through on some important things on which he campaigned in 2008, including health-care reform, stimulus for the economy and finding Osama bin Laden. The sole Supreme Court justice he has appointed to date appears not to be a sociopath. He can, on some subjects, be trusted, at the least, not to do the wrong thing.

But Romney has a history of doing the wrong thing, time and time again, particularly in the economic sphere, where we remain vulnerable. On top of that, he has held so many positions so many times on so many issues, it simply is impossible anymore to place any credence in anything that comes out of his mouth, including his own name.

N.B. I pray for the day when Rachel Maddow gets to moderate a presidential debate. Because as much as she comes across about as threateningly as your smarter little sister, she will cut a guy. And I want to be watching when it happens, because as politics goes, I suspect it might be the single greatest moment of my lifetime.

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