Yes, A Tax Scandal Can Take Down a Politician
There are thousands of words in the New York Times account of Donald Trump’s taxes, and tens of thousands more will be published in the coming weeks.
But it’s the first 27 words of the piece that have the potential to inflict a serious wound on the president: “Donald J. Trump paid $750 in federal income taxes the year he won the presidency. In his first year in the White House, he paid another $750.”
The body of the story recounts years of dissembling about his finances: claiming huge losses to offset his tax liabilities, inflating his assets to obtain massive loans, asserting that: “Now, with his financial challenges mounting, the records show that he depends more and more on making money from businesses that put him in potential and often direct conflict of interest with his job as president.” It is rich in detail, and those details—hundreds of thousands of dollars in “consulting fees” to daughter Ivanka, a disputed $72.9-million tax refund, among other things—are not the stuff of easy interpretation (although $72,000 of deductible “business expenses” for hair styling, might raise a few eyebrows).
But that opening number—$750 in taxes from the self-proclaimed multibillionaire—is easy to grasp, and easy to turn into a clear political message.
The proof of this can be found in a Tennessee Senate race in 1976. First-term Senator Bill Brock, who had defeated Al Gore Sr., years earlier, was in a difficult race against Democrat James Sasser. In mid-October, after being pressured by the press about his finances, Brock conceded that he’d paid $2,026 on an income of $51,670—a rate of less than 4 percent at a time when someone making that much would have written the IRS a check for as much as 62 percent of his income.
Almost immediately, hot pink buttons began appearing reading: “I Paid More Taxes Than Brock.” As the story spread, the chair of the State Labor Council held a news conference comparing Brock’s taxes with those of an auto worker, steel worker and railroad engineer, each of whom paid far more taxes on far lower salaries than Brock. In November, Brock lost his seat by a 5-point margin.
The story had resonance because it confirmed “populist” notions about how things really work: that one way or another those in positions of power manage to avoid the burdens that afflict “regular” people. It’s what lay behind one of Richard Nixon’s liabilities during his Watergate days: his taxes. In one case, he had claimed a $500,000 tax deduction for donating his essentially worthless vice presidential papers. In another, it turned out he had paid $792.81 in federal income taxes in 1970 and $878.03 in 1971, on a salary of $200,000. (His taxes were not included in the Articles of Impeachment adopted by the House Judiciary Committee.)
Asked about the story at his news conference Sunday evening, Trump explained (I use the word loosely) that the story was a hoax, a fake. A Trump spokesperson told the Times that Tump had paid huge sums in taxes—without explaining what kind of taxes—but did not deny the basic assertion that he had paid only $750 a year for two years.
Perhaps the president, who has survived many seemingly fatal controversies, has so succeeded in convincing his acolytes not to believe anything critical of him that this latest story will have little effect. But I wonder: What if people start showing up in offices, factories, in malls and stores, with buttons and T-shirts reading: “I Paid More Taxes Than Trump”?
There’s an 89-year-old ex-Senator in Chattanooga who might be able to tell you what comes next.
