Donald Trump’s tax returns have been a recurring discussion for almost a year, but the conversation hit a new high after last week’s debate. After Hillary Clinton brought up her opponent’s refusal to disclose his tax returns, he made the flippant statement, “That makes me smart.” The Washington Post reporter attending the debate heard the comment, “That’s offensive. I pay taxes.”
Even more outrage was expressed after it was learned that Trump may avoid paying taxes for almost two decades on earnings of $50 million a year because he declared a loss of almost $1 billion on his 1995 income tax returns. No one admits to providing the New York Times with this information, but no denials of accuracy have been issued by Trump and his associates at that time although Trump said that this information was “illegally obtained.”
Surrogates have praise Trump for not paying any federal income taxes. Former New York Mayor Rudy Giuliani called him a genius for this avoidance although Giuliani has said some other very odd things. The mayor of New York at the time of the 9/11 attacks said that terrorists had not attacked the United States until Barack Obama became president. Giuliani also slammed Hillary Clinton for her husband’s affairs and then covered for his own and those of Trump by saying “everyone does it.” How can a genius lose almost $1 billion in such a short time?
New Jersey Chris Christie described the release of Trump’s tax return as “actually a very, very good story” for the Trump campaign. In an on-going lawsuit about the political closure of the George Washington Bridge, both prosecutors and lawyers for the defendants claim that Christie approved the action during the closure, and a defendant has sworn under oath that Christie was told at the time that the bridge was ordered closed.
Republicans have long described people who don’t pay taxes as parasites and worse. For example, House Speaker Paul Ryan (R-WI) described people who didn’t pay taxes as “takers” as compared to the “makers,” and GOP presidential candidate Mitt Romney talked about the “47 percent.” Trump is a member of Ryan’s “takers.”
A far more serious problem than Trump not paying taxes, however, is the revelation of Trump as a failure as a businessman during the booming economy of the 1990s through mismanaging three Atlantic City casinos, investing in an airline company, and purchasing Manhattan’s Plaza Hotel. He’s running on his boast that he’s brilliant in business and creating jobs and then declares a loss of $916 million—about $1.5 billion in today’s dollars. Either the jobs that Trump claims to have created disappeared, or he refused to pay the people he hired.
In his declared loss of $916 million,Trump also destroyed investors when share holders lost almost the entire value as shares dropped from $35.50 to 17 cents. The only winner was Trump, who could use “net operating losses” to cancel out any taxable income for the next 18 years. With a good—and expensive—lawyer, Trump can also stiff everyone he owes by declaring bankruptcy and “reorganizing” his debts. Trump bought buildings and businesses with borrowed money and then deducted interest paid on the debt and took depreciation deductions while his real estate appreciated in value. He’s right that the system is rigged, and it’s rigged in his favor.
The question swirling the internet is how Trump managed to lose $916 million in 1995, a year when the average loss among millionaires was $614,000. One theory is that he didn’t lose the money. John Hempton, an Australian hedge fund manager and former expert on tax avoidance for the Australian Treasury, theorized that Trump “parked” the debt from his bankruptcies in a dummy party offshore where it was neither collected nor officially forgiven. No one has denied this theory either.
There’s support for Hempton’s theory in how little Trump actually lost in the early 1990s. An analysis of financial reports from Trump’s businesses shows far less than the $916 million that he supposedly lost. Trump lost about $13 million from THCR (Trump Hotels, Casinos, Resorts) in a few years. He also sold the Plaza Hotel to Saudi and Asian investors for $325 after buying it for $400 million, but he may not have had any loss in the sale. The purchasers assumed $440 million in debt in addition to the purchase price, making Trump’s total closer to $765 million. In addition, banks wrote down Trump’s loan in order to make sure the sale went through. All this for a hotel that Trump never owned because he put no money down on it. The loans against the Plaza paid for Eastern Air Lines Shuttle and the construction of the Taj Mahal casino in Atlantic City.
Another fact detracting from the people’s belief in Trump’s business acumen is that he lost $800 million last year, reducing his assets to $3.7 billion. To all of us, that sounds like a lot of money, but he lost almost 20 percent of all his assets in one year. People who admire him should consider what would happen to their own lives if they lost 20 percent of their own assets in one year.
People who want Trump’s business model for the United States don’t understand that his system doesn’t work for a country that borrows money from other countries. The end result could be that all those other countries will then own the U.S.
“We are going to protect our steel industries.” That’s what Trump told an audience today, but he bought steel and aluminum in two of his three construction projects from China during the past four years. At other times, he skipped the steel and bought less-expensive concrete from companies linked to the Luchese and Genovese crime families. These projects were not for public companies so his decision was made to line the pockets of himself and his family. Buying from China is nothing new for Trump: that’s where all the suits and ties for Trump’s Signature line are made. He also lied about not being able to buy this clothing in the U.S.
Trump also faces grim problems regarding the Trump Foundation. It was bad enough when facts emerged that he was using the charitable group, with donations totally for other people, as a personal slush fund to bail him out of lawsuits and purchase personal items. Surrogates had no defense for Trump’s actions because they immediately pivoted to talking about the Clinton Foundation—that has no illegal issues—when asked about the Trump’s foundation.
The most recent concern is that the foundation never got New York registration and annual auditing to allow it to operate as a large (over $25,000 a year) foundation. The Trump Foundation took in at least $1.67 million through his website. Trump has been told to stop soliciting donations for the Trump Foundation.
In another illegal action, a Trump-controlled company secretly conducted business in Communist Cuba during a time of strict U.S. trade bans. The $68,000 spent in 1998 was prohibited without U.S. approval although the company, with Trump’s knowledge, funneled the money through a U.S. consulting firm that tried to make the expenses legal by linking it after the fact to charity. Just after this foray into Cuba, Trump told Cuban-Americans that he promised to maintain the embargo and never spend any money in Cuba while Fidel Castro.
Every time Trump opens his mouth, he says something offensive. Today the man who dodged the draft with a possible temporary bone spur charged that soldiers who suffer from PTSD aren’t “strong” and “can’t handle it.” This harsh rhetoric from Trump pairs with his statement that prisoners of war aren’t heroes because, as he put it, “I like people who weren’t captured.” He’s also bragged that attending an expensive prep school gave him “more training militarily than a lot of the guys that go into the military.”
A letter defending Trump published in a large Oregon newspaper today presented these claims of superiority over Clinton as facts: he’s created multiple companies and hired tens of thousands of workers; he supports the military; and he’s fact-checked when Clinton isn’t. One word about the letter, in Trump’s terminology: WRONG.
People who write letters should research their subject matter. In the area of business, the author avoids all the facts about Trump’s fraud, bankruptcy for personal benefit, support for overseas companies by buying from them, theft from his own charity, financial destruction of people who invest in his companies, and lies about his success. Trump has shown no support for the military by denigrating members of the military and refusing to give them donations that he pretended to solicit for people in the armed services. In the matter of fact-checking, the letter’s author skips over all the fact-checking of Clinton that has shown her to be the most truthful candidate in the last decade.
This article covers many of Trump’s scandals, but his supporters will never read it.They live in a bubble that allows them to justify all his illegal actions and maintain their fantasy image of a strong man who will protect his followers. They’re wrong, but they can’t face the truth.