“A Fundamental Standard For Presidential Candidates”: Tax Transparency; Sanders Again Promises Full Disclosure
In a column for the New York Daily News, I criticize the failure of Donald Trump, Ted Cruz, John Kasich and Bernie Sanders to release their full tax returns – a fundamental standard for presidential candidates, as David Cay Johnston recently explained here. Noting that there is no reason to suspect Sanders, in particular, of having anything to hide, I describe his non-disclosure in the Daily News as “bewildering.”
Yesterday, on NBC’s Meet the Press, host Chuck Todd braced Sanders on the issue quite directly:
TODD: Where are your tax returns? And wouldn’t that put you on a higher ground in calling for Hillary Clinton to say release these speech transcripts?
SANDERS: We are going to — we are going to release. I think we’ve talked about it before. Actually, you know, my wife works on our taxes. We’ve been busy. We are going to get out — all of our taxes out. Trust me, there is nothing that is going to surprise anybody.
TODD: Are you going to — but are you going to do seven, 10, 15 years’ worth of tax returns? So far you have done one [Form 1040].
SANDERS: We will do the best that we can. But, yes, we will get our tax returns out.
It’s good that he promised to disclose, although he didn’t say when. He made the same promise to Jake Tapper on CNN more than a week ago. And the Vermont senator didn’t explain why disclosure is so difficult for him and his wife. If there’s “nothing that is going to surprise anybody,” why is he stalling?
It is also puzzling to me that the media generally and the top newspaper editorial pages in particular remain so tolerant of stonewalling on taxes by all the candidates. (On February 26, by contrast, the Times published a scathing editorial demanding that Clinton release transcripts of her paid speeches to banks.) That wasn’t the attitude of the New York Times and Washington Post editorial boards toward tax disclosure four years ago, when Mitt Romney tried that strategy.
The Post raked Romney on January 12, 2012, blasting his “determined lack of transparency” as “a striking and disturbing departure from the past practice of presidential candidates of both parties:
Asking candidates to make their tax returns public is undoubtedly an invasion of privacy. But it is one that comes with the territory of a presidential campaign. Such disclosure is not required by law but, as with the voluntary release of tax filings by the president and vice president, it has become routine, if at times grudging and belated.
A few days later, on January 17, 2012, the Times published “Taxes and Transparency,” an editorial that described Romney’s “insistence on secrecy” as “impossible to defend,” and put the issue plainly:
It is not too much to ask someone seeking the nation’s highest office to sacrifice some personal privacy to reassure voters that they have no hidden entanglements.
Two days later, when Romney attempted to get away with very limited disclosure, the Times thundered again:
Let’s be clear: despite Mr. Romney’s claim that ”people will want to see the most recent year,” his 2011 taxes would not be enough. Voters have a right to know how presidential aspirants made their money — not just in the year before the election.
To date, Sanders has posted only the first two pages of his 2014 tax return, nothing more. Cruz and Kasich have done the same, except for more than one year. Trump has disclosed zero, of course, while spouting his usual bombastic nonsense. So in 2016, the flouting of norms is even worse than 2012, except for one candidate – Hillary Clinton — who disclosed her complete returns dating back to 2000 and beyond last summer. I would hate to think that’s why the Post and the Times are allowing all the other candidates to escape scrutiny on this issue.
By: Joe Conason, Editor in Chief, Editor’s Blog, Featured Post, The National Memo, April 11, 2016
“Disclosures Neither Accurate Nor Honest”: Why Hasn’t Bernie Sanders Released His Tax Returns? (Or Cruz Or Kasich, Either…)
Bernie Sanders holds himself out to huge and adoring crowds as a model of personal, political and financial integrity. But when it comes to revealing his income tax returns, Sanders is as tricky a politician as Republicans Ted Cruz and John Kasich.
In this bizarre political year, Donald Trump has shown more candor than Sanders when it comes to his tax returns. That is an amazing and disturbing feat, given Trump’s penchant for exaggeration and just making stuff up, as I have been documenting since 1988. Understand that while Trump has fabricated an excuse for not disclosing any of his income tax returns, he was being more forthright than Sanders, who tries to pretend that he has disclosed his taxes.
What may surprise some is that of the five remaining Presidential candidates, only Hillary Clinton has been completely candid and forthright about her and her husband’s income tax returns, a policy of theirs that dates at least to 1992. Despite her singular transparency, news organizations routinely write, without citing any verifiable supporting facts, about Clinton’s perceived mendacity.
So what’s the issue? The Sanders, Cruz and Kasich campaigns have all distributed what they claim are tax returns; Kasich for seven years, Cruz for four, and Sanders for just one year, 2014.
But those proclaimed disclosures were neither accurate nor honest. None of those candidates has released even a single tax return.
What they made public instead was merely a summary known as IRS Form 1040. That form is no more a tax return than the Preamble is the Constitution.
No, a tax return is the entire document filed with the IRS – the forms, schedules, and statements that reveal the numbers and calculations about income, deductions, and tax liabilities behind the summary information on Form 1040. Without the full tax return, the public cannot know sources of income, justifications for deductions, or how aggressively tax law was applied to reduce the income tax due.
History tells us that disclosing complete tax returns, not just a summary form, is vital to determining a president’s trustworthiness. It was only 45 years ago that (freshly “resigned”) Vice President Spiro Agnew plead guilty to one count of tax evasion, making him a felon. Without the action of an IRS employee who illegally leaked President Nixon‘s 1969 through 1972 tax returns, we would never have known about the tax crimes in which the president was an unindicted co-conspirator, and for which one of his advisors plead guilty. If all we had were Nixon’s and Agnew’s Form 1040s, their tax crimes would have remained unknown.
On disclosing tax returns Trump scores better than Sanders, because while Trump will not release his returns, citing a bogus excuse, he has not tried to pretend that he did disclose. But that is exactly what Sanders, Cruz and Kasich did. (Trump says he can’t disclose because he is under IRS audit, even though revealing his returns would have no impact on the audit of a tax return, which is signed under penalty of perjury.)
Contrast their conduct with Hillary Clinton, whose every tax return signed by her and husband Bill has been disclosed since at least 1992. That’s how we know they are far more charitable than the self-described “ardent philanthropist” Donald Trump or any other of the various presidents back to FDR (and some presidential wannabes like Newt Gingrich) who have made public their tax returns. Those returns, and in some cases only Form 1040s, are posted at taxhistory.org, a website maintained by the nonprofit Tax Analysts, for which I write critiques of tax policy.
As for Sanders, the single Form 1040 he released raises more questions than it answers, especially since the junior senator from Vermont has a history of making incomplete and misleading financial disclosures.
In 2014, he reported an adjusted gross income of $205,271, most of it from his Senate salary.
What appears unusual are his itemized deductions, totaling $56,377, a whopping 27.4 percent of his income. People in his income class of $200,000 to $500,000 on average take 15.6 percent of their income as deductions, while those in the $100,000 to $200,000 range averaged 18.8 percent. Both averages are far below the Sanders itemization rate.
Sanders and his wife paid $27,653 in federal income tax, or 13.4 percent of their adjusted gross income.
When I tried to look more closely at Sanders’ taxes, Michael Briggs, the chief spokesman for his campaign, sent a statement that is simply not true, although he may not have understood why at first. In an email, Briggs wrote that Sanders and his wife Jane “made public his federal and state income tax returns last year when he became a candidate for president and intends to do so again this year.”
I wrote back to Briggs repeatedly, explaining that a Form 1040 is not a tax return. Perhaps that was unnecessary, since Briggs has more than two decades of experience as a political reporter and publicist for various U.S. senators. More than two decades ago on C-SPAN, he displayed a nuanced understanding of legal issues.
That background raises difficult questions about Briggs’ responses, which i tried to explore despite his failure to answer follow-up questions. The Cruz and Kasich campaigns also ignored emails asking for their complete tax returns or an explanation of why only Form 1040s were released
To readers who think this sounds too harsh, I’d say that when Sanders holds himself out as a paragon — running a campaign built on the idea that he remains untainted by money from the rich and powerful — he should be expected to walk the talk.
Sanders set the standard here. I am holding him to the same measure of integrity that I have used to assess Bill and Hillary Clinton, George W. Bush, Steve Forbes, and numerous other politicians at the federal, state and local levels going back almost 50 years to my first investigative story.
Last fall, Sanders revised his 2012 and 2014 financial disclosures twice. His 2013 disclosure was revised three times. Sanders failed to disclose four mortgages, all of them at market interest rates, which raises a question about his judgment, since nothing appears improper except the failure to fully disclose.
Mark Lippman of Daily Kos was evidently the first to report the Vermont senator’s incomplete disclosures. He also noted that the value of Jane Sanders’ “retirement accounts appreciated in value from $285,000 in 2011 to $481,000 in 2014.” Nothing wrong there, by the way, though readers may find the 68.8 percent increase puzzling because Lippman failed to give context. The broad stock market rose 64 percent during that period, indicating the big gain was basically owed to stock market returns, plus about $400 a month in additional deposits to Ms. Sanders’ retirement portfolio.
Why Sanders would play games with his income taxes is a mystery. While he is much better off than most Americans, he is a man of modest means compared to Clinton, Cruz, and Trump. But his conduct raises a question politically. Is he hiding something? Certainly Trump is, since the boastful billionaire probably pays close to zero in income taxes, as I have explained here, here and here.
The question to ask Sanders – as well as Cruz, Kasich, and Trump – is why they are hiding the information they supplied under penalty of perjury to the IRS as a true, complete, and accurate description of their income, deductions, and taxes.
And whatever you may think of Hillary Clinton, she deserves real props for more than two decades of being forthright and complete in disclosing her tax returns.
By: David Cay Johnston, The National Memo, April 1, 2016
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