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Monday, October 03, 2016

Trump the "economic genius"

by digby

I wrote about it for Salon this morning:

According to focus groups, the exchange in last Monday’s campaign debate between Hillary Clinton and Donald Trump that really offended people of all political stripes was not Trump’s revolting attitudes about women, although that was plenty offensive. It was the “taxes comment.” The Washington Post’s report on its focus group of undecided voters in North Carolina had this headline: “When Trump said that not paying taxes ‘makes me smart,’ undecided voters in N.C. gasped”:
“That’s offensive. I pay taxes,” said Townley, 52, a program ­director for a local council of governments. 
“Another person would be in jail for that,” said Jamilla Hawkins, 33, who was sitting beside him in the Crescent conference room at the Embassy Suites in this city of 150,000 near Raleigh.
Pollster Frank Luntz’s dial-o-meter focus group also showed a sharp plunge for Trump when the tax discussion came up. After the debate Trump even denied saying it, which was ridiculous since more than 80 million people watched him do it.

Clinton was correct when she said that what little we knew from the few of Trump’s tax returns previously made public for various reasons was that he often pays little or no federal taxes. Over the weekend, the New York Times published abombshell article featuring Trump’s 1995 tax returns from several states, which had been delivered anonymously to the paper. It not only showed that Trump had paid no federal income tax that year but that he had claimed nearly a billion dollars in losses. Tax experts told the Times that could mean he wrote off $50 million per year ever since. This certainly lends credibility to the speculation that he has refused to release his returns for that reason — because he has rarely or never paid even a nickel in federal income tax. Obviously, if he wants to end that speculation and prove everyone wrong, he could simply release the returns.

The Times had asked Trump for comment, so he undoubtedly knew this story was going to break before he took the stage at his Saturday night rally in Pennsylvania, where he proceeded to deliver one of his most unhinged rants in many months. Trump accused Hillary Clinton of being unfaithful to her husband and performed an imitation of her fainting spell to illustrate that she’s weak, saying, “She’s supposed to fight all these different things and she can’t make it 15 feet to her car.” (He must have skipped the chapter on Franklin D. Roosevelt in high school history class.) Between his disastrous debate performance and this news,which cuts to the heart of his main argument for the presidency, Trump ended a very bad week with a very, very bad night.

His surrogates were rattled as well. On Sunday morning they sent out their big guns, the people reportedly closest to Trump at the moment, former New York mayor Rudy Giuliani and New Jersey Gov. Chris Christie. The two of them put on performances that would be career-enders if they hadn’t already ended them by taking on the roles of Trump majordomos. They both made the rounds to declare that Trump is a “genius,” with Christie declaring that the tax revelation is “a very good story” for Trump because it shows him as the comeback kid. Giuliani compared Trump to Winston Churchill and Steve Jobs, saying that like them, “He had some failures and then he built an empire.” He asked thefundamental question: “Don’t you think a man who has this kind of economic genius is a lot better for the United States than a woman?”

The idea that a man whose business has gone bankrupt four times, who has stiffed thousands of small business owners, who has been sued all over the country for fraud, who used his charity as a slush fund and who now has been revealed to have reported to the government that he lost more than $915 million — in a year in which the stock market gained 37 percent! — is an economic genius could only be true in Bizarro World.

Trump himself tweeted, “I know our complex tax laws better than anyone who has ever run for president and am the only one who can fix them.” In fact, Trump’s tax plan is standard-issue GOP Club for Growth trickle-down. It’s the most conventional aspect of his entire platform. And the fact that he’s a card-carrying member of the 1 percent means that he’s proposed a tax plan that will benefit him and his family “big league.” He would drastically cut corporate taxes, reduce the top rates and eliminate the estate tax, providing a windfall for his children. And then there’s this little noticed provision, via the Washington Post’s Wonkblog:
Trump’s plan would dramatically reduce taxes on what is known in tax circles as “pass-through” entities, which do not pay corporate income taxes, but whose owners are taxed at individual rates on their share of profits. Those entities are the most common structure for small businesses and increasingly popular for larger ones as well. They are also a cornerstone of the Trump Organization. On his 2015 presidential financial disclosure report, Trump listed holdings of more than 200 limited liability corporations, which is a form of pass-through.
This is unusual. Recent GOP nominees have simply proposed reducing the top tax rate, which would effectively lower the pass-through rate. Mitt Romney wanted to lower it to 28 percent, John McCain picked 35 percent and George W. Bush proposed 33 percent. Trump wants to lower that rate to 15 percent. I’ll leave it to the experts to sort out why he thinks that’s a good idea, but suffice to say it’s clear that he would personally benefit from it.

It should be pointed out that Hillary Clinton, by contrast, has proposed a tax plan that would create a new top bracket of 43.6 percent and a minimum tax rate of 30 percent for anyone making more than $1 million. She would also raise the estate tax. None of this benefits her or her family. In fact, one of he most glaring differences between these two wealthy candidates is that Bill and Hillary Clinton go out of their way to pay substantially more in taxes than is necessary. They can afford it, certainly. They are reportedly worth more than $100 million. But it does show a very different philosophy than Donald Trump, whose alleged $10 billion fortune is vastly larger. He apparently feels that paying no taxes makes him smarter than all of us dumb citizens who do.

If you think Trump is a genius for gaming the system so that he never has to pay federal income tax, that’s your prerogative. But please don’t ever say another word about “makers and takers” or the 47 percent again. We taxpayers have been carrying Donald Trump for 30 years while he was living in his golden palace. He’s the biggest welfare queen in the world.