“The Romneys Get Theirs”: How MItt Romney Used His Church’s Charity Status To Lower His Tax Bill
We already know that Mormon Mitt Romney has been tremendously generous to his church, giving over $5 million in the past two years alone, but now we learn that his charitable activity with LDS may not have been entirely altruistic. Bloomberg’s Jesse Drucker reports that Romney exploited the church’s tax-exempt status to lower his tax bill.
Romney reportedly took advantage of a loophole, called a charitable remainder unitrust or CRUT, which allows someone to park money or securities in a tax-deferred trust marked for his or her favorite charity, but which often doesn’t pay out much to the nonprofit. The donor pays taxes on the fixed yearly income from the trust, but the principal remains untaxed. Congress outlawed the practice in 1997, but Romney slid in under the wire when his trust, created in June 1996, was grandfathered in.
The trust essentially lets someone “rent” the charity’s tax-exemption while not actually giving the charity much money. If done for this purpose, the trust pays out more every year to the donor than it makes in returns on its holdings, depleting the principal over time, so that when the donor dies and the trust is transferred to the charity, there’s often little left. The actual contribution “is just a throwaway,” Jonathan Blattmachr, a lawyer who set up hundreds of CRUTs in the 1990s, told Bloomberg. “I used to structure them so the value dedicated to charity was as close to zero as possible without being zero.”
Indeed, this appears to be the case for Romney’s trust as well. Bloomberg obtained the trust’s tax returns through a Freedom of Information Request and found that Romney’s CRUT started at $750,000 in 2001 but ended 2011 with only $421,203 — over a period when the stock market grew. Romney’s trust was projected to leave less than 8 percent of the original contribution to the church (or another charity that he can designate). This, along with the trust’s poor returns — it made just $48 in 2011 — suggest the trust is not designed to grow for the LDS church but just serve as a tax-free holding pool from which annual payments can be disbursed to the Romneys.
This is hardly the first tax-avoidance strategy Romney has employed. It’s well known that he holds offshore bank accounts in Switzerland and the Cayman Islands, but he has used more obscure vehicles as well. There’s the “total return equity swap,” where a taxpayer calls a stock he owns by another name and doesn’t pay taxes on it. There’s the way he’s been avoiding gift and estate taxes through a trust that he set up for his children and grandchildren. And there’s the neat trick whereby private equity firms claim that management fees are capital gains and thus qualify for a lower tax rate than straight income. Bain Capital was known for pursuing an aggressive tax-mitigation strategy (they’re now under investigation for it), and so was Marriott Hotels when Romney was an influential board member.
And it’s not just taxpayers who lose out. “The Romneys get theirs off the top and the charity gets what’s left,” said Michael Arlein, a trusts and estates lawyer at Patterson Belknap Webb & Tyler LLP. “So by definition, if it’s not performing as well, the charity gets harmed more.”
By: Alex Seitz-Wald, Salon, October 31, 2012
“Protecting National Security”: Ann Romney Thinks Mormon Missions Are Just Like Military Service
Thursday morning, Mitt ducked a scheduled performance on The View (more on that later), leaving his wife Ann Romney to represent the candidate’s views on those pesky “women’s issues” like abortion rights and military service.
Her answer on the latter question is turning some heads.
When pressed by Whoopi Goldberg on how Romney would explain why neither he nor any of his five sons served, Ann explained that the six men found “different ways of serving” by going on their Mormon religious missions.
“So, you know, we find different ways of serving,” she said. “And my husband and my five boys did serve missions, [but they] did not serve in the military.”
The substitution, she went on to explain, makes sense because the two share essential, character-building and altruistic values.
“I sent them away boys and they came back men. And what the difference was — and I think this where military service is so extraordinary too — is where you literally do something where you’re helping someone else. You’re going outside of yourself and you’re working and helping others. And that changes you,” she said.
The exchange began when Goldberg mistakenly asserted that Mitt Romney hadn’t served in Vietnam because it was against his religion. Goldberg’s statement was, to be fair, a clear misinterpretation of Mormonism (which is not at all a CST version of Quakerism), and Anne Romney quickly corrected her.
“That’s not correct,” she said pointedly. “He was serving his mission, and my five sons have also served missions.”
To set the record straight, Mormon missions are voluntary, non-violent trips focused on proselytizing about the Church of Latter Day Saints. Men begin their mission — which lasts for two years — at 18 or 19 years old. This month, the Church decided to allow women to begin their mission — which lasts for 6 to 18 months — as early as 19, down from the previous age of 21. The missionary practice is credited as one of the main reasons that the LDS Church is one of the fastest growing religions in the United States and in Central and South America. If Mormonism shares anything with U.S. military, then, it may be that both facilitate the exportation of Western cultural values across the globe.
Some veterans, however, are not so happy to hear the prospective First Lady equate a voluntary religious mission aimed at growing your religion with the sacrifice of serving in the U.S. military in the name of protecting American national security.
“Between my husband and I, we have a collective 10 years in the army. My husband was in Iraq in 2004, and I went to the Pentagon after 9-11. I am deeply offended by Ann’s comments. How can she believe her son’s missions could even begin to compare to our service? Not to mention those we served with who came home in body bags …” wrote a commenter on a discussion forum for those who have left the Mormon Church.
Meanwhile, as Ann was on The View, Mitt Romney made a surprise appearance at the meeting of a Colorado Political Action Committee — also known as a campaign funding PAC.
The group, the American Conservative Union, boasts of being one of the oldest conservative organizations in the country. It champions a mission statement that asserts “collectivism and capitalism are incompatible” … “our inherent rights are endowed by the Creator … [which] can remain secure only if government is so limited that it cannot infringe upon those rights” … and “the forces of international Communism are, at present, the greatest single threat to these liberties.” (Either the statement of principles hasn’t been updated, or next week’s foreign policy debate is going to be considerably more exciting than anticipated.)
Romney’s appearance on The View had been widely anticipated since he admitted at a private fundraiser that he was nervous about sitting down with the “non-conservative” and “sharp-tongued” women. This comment, along with the now infamous 47 percent comment, was recorded in a secret video leaked by Mother Jones.
Too bad Romney ended up having “scheduling problems” Thursday morning.
By: Laura Gottesdiener, Alternet, October 20, 2012
“Too Many Mitt’s”: Shameless And Shape Shifting; To Know Him Is To Mistrust Him
It will have zero effect on a certain Romney landslide in Utah, but the particular wording and reasoning of the Salt Lake Tribune‘s editorial endorsing Barack Obama will resonate far and wide. The “Trib” chose to write its repudiation of semi-favorite-son Mitt with the tone of someone familiar with a pol who’s sold his birthright for a mess of pottage:
Nowhere has Mitt Romney’s pursuit of the presidency been more warmly welcomed or closely followed than here in Utah. The Republican nominee’s political and religious pedigrees, his adeptly bipartisan governorship of a Democratic state, and his head for business and the bottom line all inspire admiration and hope in our largely Mormon, Republican, business-friendly state.
But it was Romney’s singular role in rescuing Utah’s organization of the 2002 Olympics from a cesspool of scandal, and his oversight of the most successful Winter Games on record, that make him the Beehive State’s favorite adopted son. After all, Romney managed to save the state from ignominy, turning the extravaganza into a showcase for the matchless landscapes, volunteerism and efficiency that told the world what is best and most beautiful about Utah and its people.
Sounds like the buildup to an endorsement, eh? Not hardly.
In short, this is the Mitt Romney we knew, or thought we knew, as one of us.
Sadly, it is not the only Romney, as his campaign for the White House has made abundantly clear, first in his servile courtship of the tea party in order to win the nomination, and now as the party’s shape-shifting nominee. From his embrace of the party’s radical right wing, to subsequent portrayals of himself as a moderate champion of the middle class, Romney has raised the most frequently asked question of the campaign: “Who is this guy, really, and what in the world does he truly believe?”
The evidence suggests no clear answer, or at least one that would survive Romney’s next speech or sound bite. Politicians routinely tailor their words to suit an audience. Romney, though, is shameless, lavishing vastly diverse audiences with words, any words, they would trade their votes to hear.
The editorial eventually gets around to some measured positive comments about Barack Obama, but it’s clear from the headline–“Too Many Mitts”–that its main thrust is aimed at showing not everybody in Utah is buying this particular snowstorm.
The president is entertaining audiences today by referring to his opponent with his vast number of serpentine manuevers as someone suffering from “Romnesia.” The Salt Lake Tribune begs to differ: Mitt hasn’t forgotten a thing; he’s just doing whatever the political markets call for, and hoping voters suffer from Romnesia.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, October 19, 2012
“Uncle Will At Your Service”: Marriott Is Mainstay For The Romney campaign
On the campaign trail, Mitt Romney incessantly talks about his “five points” to get the country moving again, but the only points anyone traveling with the GOP nominee is interested in are Marriott points.
The candidate has made the hotel chain the semi-official innkeeper of his presidential campaign. From Iowa to Ohio to New York City, Romney has wheeled his carry-on bag into Marriott lobbies and passed the omnipresent portrait of J. Willard Marriott and his son, John Willard “Bill” Marriott Jr. — a Romney contemporary, fellow Mormon scion and, along with his brother, a donor of more than $1 million to the Republican’s effort.
The Romneys and Marriotts go way back. J. Willard was a dear friend of Mitt’s father, George, with whom he sold tamales in Washington during the Depression Era. Forty years later, J. Willard Marriott asked his namesake Willard Mitt Romney, a young consultant with Bain & Co., to help with his Roy Rogers fast-food chain. But Bain prevented those at the firm from working for any client who employed their chief competitor, McKinsey & Co., which Marriott did. Or from working in a peripheral part of the business, which Roy Rogers was.
Romney had to call up “Uncle Will” — as he called him — to decline the work, according to Mike Farmer, who accompanied Romney on the sales trip.
But Romney, who once sat on the Marriott board, has stayed loyal to the Marriott empire. And now so has the phalanx of campaign operatives, television producers, camera operators and reporters, checking in behind the candidate with corporate cards in hand. (On Sunday, the Obama campaign press corp was also camped out at a Courtyard Marriott in Williamsburg.)
“It’s our home away from home,” said Rick Gorka, a spokesman for the Romney campaign. “We’ve converted a lot of press.”
To build brand loyalty and try to beat the competition, Marriott rewards guests with lodging’s version of frequent flyer miles for each stay. A steady accumulation of Marriott points bestows first silver, then gold and finally platinum status, each precious metal coming with its own precious perks.
“I’m platinum,” Gorka said proudly as he swirled a large glass of bourbon on the back of the press plane. Having spent at least 150 nights in Marriott hotels since January and racked up a half-million points, he spoke reverentially about the “Taste of Platinum” program. He became almost misty discussing the time the West Palm Beach Marriott upgraded him to a two-bedroom condo with balcony, hot tub, washer and dryer. He said he daydreamed about a prolonged, free stay in a perhaps tropical destination with his girlfriend, who eagerly monitored his point total back home. “Points,” he said, “are gold for us.”
On his way back toward the front of the plane, Gorka hovered over the aqua-blue screen of a reporter’s laptop. She was gazing at the crystalline waters surrounding Marriott’s Scrub Island Resort, Spa & Marina in the Virgin Islands. “It’s a new Marriott, autograph collection” she explained to Gorka. “It’s on a private island, 52 rooms on the marina. It looks amazing.”
“Let me know if you go,” Gorka said.
The day had started, as so many of them do, with Romney staffers and Romney press corps members climbing out of their Marriott mattresses and picking at eggs in a private breakfast room off the lobby, this time of the Columbus Airport Marriott. One of the camera crew interrupted the breakfast of one of the embedded television reporters to ask, “Are you triple platinum now?”
“Oh, yeah,” she responded matter of factly. “I, like, lived in the Marriott New Hampshire. I have 200 free nights.”
It came time to board the bus, and a circle of cameramen discussed the finer points of Marriott points, saying things like “mega bonus.”
“Have you enrolled in the platinum challenge?” one asked this reporter, who had a lowly silver status. He described an alchemy by which every two-night stay results in a free night in another Marriott. As long as it isn’t too high end, interjected a colleague, “Only category three or four, not five.”
The press then loaded onto the bus, following Romney as he campaigned around the state. Then they boarded the plane, flew with him to Boston and boarded another bus to bring them to their hotels. As the coach rolled toward the entrance of the Courtyard Marriott in Waltham, one of the embedded network producers shouted to no one in particular: “Why don’t we stay at the Westin out here? Why does the Marriott own our souls?”
By: Jason Horowitz, The Washington Post, October 14, 2012
“Sentimental Storytelling”: Beware Of Mitt Romney’s “Softer Side”
Everyone is talking about Mitt Romney’s “softer side.”
That’s how some reporters are characterizing a recent shift in Romney’s stump speeches.
Because Governor Romney has started talking about dead people: the Navy SEAL who died in Benghazi. The 14-year-old boy who died of leukemia (profiled at the Convention). The long-lost friend stricken with multiple disabilities, who drags himself to meet Mitt Romney at a campaign rally. And dies the next day.
The New York Times reports Romney’s stump speech: “I reached down and I put my hand on Billy’s shoulder and I whispered into his ear, and I said, ‘Billy, God bless you, I love you.’ And he whispered right back to me—and I couldn’t quite hear what he said… [He] died the next day.”
And a hush fell over the crowd.
What does this have to do with running for president?
Look, people tell tear-jerkers about dead people all the time. Dying moms and kids especially.
Glenn Beck did it with his book The Christmas Sweater, in which a boy turns up his nose at a particularly unattractive but dearly-bought sweater his mother gifted him for Christmas.
And she dies in a fiery car crash a few pages later.
Beck learned the genre, I once argued, from a particularly bruising subgenre of Mormon sentimentality: Sunday School manual anecdotes and movies that circle like vultures around accidental, lonely, and untimely deaths. Just to make us cry.
This sentimental storytelling is an American tradition dating back at least to the nineteenth century. It encourages us to zero-in on the anecdote—to identify with and shed tears for the helplessness of the victim—and lose complete sight of the big picture.
Is there anything in Romney’s foreign policy that will ensure that more Navy SEALS, sailors, and soldiers will come home quickly?
Does the Romney-Ryan budget maintain the social safety net on which disabled people depend?
And how will repealing the Affordable Health Care Act help out the thousands upon thousands of American families who don’t have access to medical care or who face medical bankruptcy as their loved ones fight cancer?
Time to ask harder questions about the “softer side.”
By: Joanna Brooks, Religion Dispatches, October 11, 2012
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