9/3 - Donald Trump, Taxes and the New York Times

This is the first in what will be daily essays on the 2016 Presidential elections.  In transparency, I supported Senator Ted Cruz and Carly Fiorina for the Presidency and often consider myself a conservative around the likes of Mark Levin, Glenn Beck and Michelle Malkin. 

Background

Much has been made about Donald Trump’s taxes.  Here is what we know to be true so far:

-          Donald Trump has leveraged tax laws to fullest extent possible to minimize or possibly eliminate his tax return.  He has stated that himself.

-          Conservatives have a history of being targeted and mistreated by the Internal Revenue Service (IRS) which includes the releasing of taxes for conservative candidates. 

-          Hillary Clinton served in the United States Senate, representing New York from 2000 to 2008.  Prior, she served as the First Lade from 1992 to 2000 and as the Secretary of State from 2009 to 2012.

These things are not debatable.

Of the things we do not know, the following are important to note:

-          If the New York Times has seen accurate and actual tax returns from Donald Trump.

-          If the access to those materials were legally obtained by the New York Times OR by someone else and given to the New York Times.

Let us now take several scenarios based on the above.

Scenario #1: Donald Trump took a significant loss several years ago and carrying those losses forward, he has not paid US federal taxes.

Donald Trump has not violated any tax laws by doing so.  He has simply done that which our complex tax code allows.  Both parties complain about loopholes and tricks in the code – about how it is rigged to help the wealthy – but no elected official done anything. 

If Hillary Clinton believes this to be such a horrible act, then why did she not introduce a bill to change that?  I did a search and could not find a single bill introduced by Hillary Clinton in her years in the Senate to reverse and close these policies.  She cannot simply complain about being the junior senator from New York as a reason – her replacement has an introduced and cosponsored legislation on a number of different issues (most of which I disagree with).

Let us give her the benefit of the doubt (which is very hard to do) and assume that she did not want to change this.  This leads us to evaluate is there merit in this idea and policy around being able to carry losses forward.  The merit may be in the fact that often times, losses on paper do not impact cash flows until months or even years later.  So perhaps allowing losses to be carried forward reduce bankruptcy occurrences and costly tax-payer bailouts in the future.  (I admit that this is a very simplistic model and I could fill pages and pages digging deeper.)  So maybe this policy should continue.

So here are the outcomes of this scenario:

-          Donald Trump did not break any laws.  Should we punish him for doing that – perhaps, but then the same criticism should be applied to Hillary Clinton.

-          Hillary Clinton who had 8 years in the Senate did not believe this to be a major issue enough to introduce changes to current tax laws.

-          There may be some merit in the tax law itself.

Scenario #2: The tax returns are not accurate, partial or misleading.  Donald may have been paying taxes (nothing wrong with) or not paying taxes (see Scenario #1).

In this scenario, we see the bias of and the lack of responsible reporting by the New York Times.  I would submit that the outcome should be the end of the New York Times – similar to Dan Rather’s career after the forged Bush memo – and/or the removal of their status as “press”.  They should not be granted the freedoms or access guaranteed and promised under the 1^st Amendment.

This also leads to the beyond-realistic, continuous occurrences of right-wing individuals being targeted for taxes.  This includes the IRS not granting tax-exempt status to tea party organizations and the release of tax returns for conservative candidates.  This started in 2010 with Christine O’Donnell, 2010 Senate candidate from Delaware, and continuing through the last Presidential cycle of Harry Reid saying he has seen Mitt Romney’s tax returns on the floor of the US Senate. 

The IRS is a federal agency and under the direction of the White House.  Even the most liberal of liberals must admit that IRS and tax treatment of conservatives is peculiar and needs to have an independent investigation look into it.

So here are the outcomes of this scenario:

-          New York Times should no longer be classified as the “press”.

-          Another conservative attacked around taxes should trigger an independent investigator into the IRS.

Conclusion

Liberals will often claim that there is nothing wrong with not paying taxes, as Mark Levin reminded us of the 2012 47% comment by Mitt Romney.  They would submit our free market, government regulation and capital systems causes these people to not have the opportunities to be able to pay taxes.  Well, the same systems are what allowed Donald Trump to not pay taxes.

Liberals will also claim that government and legislators are responsible for not passing laws to protect victims of gun violence or consumer fraud.   So we should actually hold Hillary Clinton and other people in the Congress and Senate at-fault for Donald Trump not paying taxes.

Personal Tangent

Our tax system is broken – it hurts those Americans earning middle-class incomes while favoring those who earn high or low incomes.  We need to fundamentally reform our tax codes to close loop-holes and to have people pay their fair share in the high and low income brackets.  The middle class is tired of financing our government’s failed attempts to protect and empower the citizens of our country.