• Show Notes

Dear Reader,

I wanted to see Donald Trump’s tax returns as much as anyone else did. 

But not like this.

House Democrats, during their final days as the majority party, haphazardly blasted Trump’s tax returns out into the public realm, paying little regard to the law or their own prior statements in court. It was a superficial win of sorts for Democrats, though revelation of the returns had minimal initial impact, which already has dissipated nearly entirely, just a few weeks later. And now it’s time to pay the price. With a brand new Republican majority frothing to investigate all things Biden, to bring impeachment proceedings against Cabinet members, and to pry into ongoing Justice Department investigations, Democrats have set the tone: anything goes, if you want it bad enough.

Trump’s tax returns have been a white whale of sorts ever since he ran for office in 2016 and broke with decades of tradition by refusing to disclose them to the public. But we have a right to see those returns, many said – justifiably, but legally incorrectly. Sure, the public reasonably wants and expects that a presidential candidate will show us his returns, and all of them since Richard Nixon have done so. But there’s simply no legal obligation to disclose tax returns, and we have no right to see them. If you want to be angry at somebody, look at Congress, which could have passed a law requiring public production of presidential candidate returns – but never has, while under control of either political party.

We’ve seen Trump’s returns now, and they’re interesting, and messy, and telling in some respects. We now know – and much of this had been reported in late 2020 by the New York Times – that Trump paid little to no taxes in many years, that he claimed massive losses in certain years (over $16 million in 2020, for example), that he made zero charitable contributions in 2020, and that he held a bank account in China. There’s no smoking gun of criminality – be wary anytime anybody proclaims anything a smoking gun, other than an actual gun with actual smoke coming out of the actual barrel – but we already mostly knew that. After all, New York state prosecutors have had the tax returns for nearly two years now and they haven’t brought any related criminal charges against Trump. 

Over the past several years, two separate entities have pursued Trump’s tax returns. First, the aforementioned New York state prosecutors subpoenaed Trump’s financial records and then prevailed in an extended federal court battle. But in the absence of criminal charges, prosecutors have had no lawful vehicle to make those returns public. 

And then there’s Congress where, you might expect, things get a little more loosey-goosey. Federal law provides that, upon written request by the House Ways and Means Committee for a specific individual’s tax returns, the Treasury Department (wherein the IRS resides) “shall furnish”  those returns to the Committee. Trump fought this one in the courts too, and lost, again. The Committee argued that “shall furnish” means “shall furnish,” and the federal courts, up to the Supreme Court, agreed. 

But the same law that the Committee used (properly) to obtain Trump’s tax returns also requires that any individual returns must be maintained confidentially and can be examined “only when sitting in closed executive session.” Fair enough; Congress can get these sensitive personal documents if necessary, but can’t splash them out over the airwaves. 

So how, then, did the Ways and Means Committee, in its final days under Democratic Party control, get away with making Trump’s tax returns public? Well, that’s what good old-fashioned loopholes are for. You see, the law gives the Committee discretion to place certain documents in the congressional record – which, of course, is as good as making them public. There’s a valid legal argument that a specific command (here, that individual tax returns must be held confidentially) should trump an inconsistent, broader one (here, that the Committee can put items in the congressional record). But the Democratic majority plainly wanted to barf out the records first and worry about the niceties later, or never.

The disingenuousness runs even deeper. Throughout the aforementioned legal dispute, the Committee argued to the federal courts that their true purpose in obtaining Trump’s returns was not to investigate or expose him. Rather, the Committee claimed, they had a “legitimate legislative purpose” and just wanted to consider possible new laws relating to presidential tax audits. 

This, friends, is bullshit. Love Trump or hate him, do you really think the Committee had no intent to investigate or expose the guy? Come on. (As my mom used to say to me when I was trying to peddle nonsense: look me in the eye and say that.) And would the Committee logically need to obtain Trump’s individual tax returns so they could figure out how to draft legislation about auditing future presidents? If Congress wants to pass a new law saying that presidential tax returns must be audited or disclosed, fine – do that. Why would they need to inspect thousands of pages of one former president’s records to craft such a rule? And did the Committee go back and pore through individual tax returns for, say, Barack Obama, or George W. Bush, or Bill Clinton? I know, those former presidents voluntarily disclosed their tax returns, but that’s not the issue; if Congress really needed to scrutinize individual tax returns in order to craft new legislation, they’d have looked back at the records of several presidents, not just one. 

So now we have this ugly precedent. Representative Kevin Brady, the top Republican on the House Ways and Means Committee said, “Going forward, all future chairs of both the House Ways and Means Committee and the Senate Finance Committee will have nearly unlimited power to target and make public the tax returns of private citizens, political enemies, business and labor leaders, or even the Supreme Court justices themselves.” This is hyperbolic, of course, but the fundamental point is absolutely correct. Even if a bad precedent is unlikely to result in the doomsday scenario, it’s still bad precedent, and now it’s available for further abuse.

And, rest assured, abuse that precedent they will. We know the new House majority – led by Kevin McCarthy, Jim Jordan, and others – has an aggressive slate of politically-driven investigations on tap. They’re going after Hunter Biden, of course. They’ve now got the new bonanza of classified documents found in Joe Biden’s home and private office. They’ll initiate impeachment proceedings against DHS Secretary Alejandro Mayorkas. And they’re going to investigate the purported “weaponization” of DOJ – which is a cover for a dangerous effort to meddle in ongoing criminal cases, as I wrote last week. 

But when it comes to bad faith, Democrats have set the tone in their quest to publicize Trump’s tax returns. That’s not to say two wrongs make a right or that both sides are equally at fault. That is to say that House Democrats don’t have clean hands here. They brushed past the law and they misled the courts and displayed bad faith in their pursuit of Trump’s taxes. Now it’ll be tough for those same Democrats to complain when those same tactics come back around the block.

Prosecutors ought to take notice, and a lesson, here. Donald Trump might get indicted sometime soon. We don’t know of course, but time is just about up, and if we are going to see a charge, it realistically has to happen in the next few months (which, as I’ve written before, may already be too late as a practical matter). Even if you believe that Trump ought to be indicted and convicted – don’t make excuses for those who bend the rules to get there. I get it; there’s a powerful, pent-up yearning to see justice done. But let’s not equate “justice” with “Trump gets nailed, and I don’t care how.” Don’t let the ends justify the means. The Ways and Means Committee got their man (sorta) and they got his tax returns out in the public – but they didn’t do it honestly, or fairly. The stakes will be even higher for prosecutors. Let’s demand better of them.

Stay Informed,

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