No Tax Returns Means No Real Skinny on Trump’s Charitable Behavior

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Trump Tower / Brad

 May 12, 2016; Seattle Times and the New York Times

We have been writing about Donald Trump’s highly questionable claims to being highly charitable since 2011—see here and here—and now that he’s the GOP’s presumptive nominee, one would imagine the benefits of laying to rest longstanding concerns. But in fact the picture seems to have worsened of late, with recent examinations of his much-publicized veterans fundraiser and the suggestion of improper payments from his foundation. Any hopes we might have had about further clarifying Trump’s real levels of philanthropic behavior, which he says is done mostly from his personal checkbook, have been dashed for now with his announcement that he will not release his tax returns before the election.

Justin Wolfers, a professor of economics and public policy at the University of Michigan writes in the New York Times that the act of not disclosing ones tax returns is a “trust me” provocation—an invitation to buy a pig in a poke. He says, “The problem for Mr. Trump is that the voters don’t know if he’s Honest Donald or some other Donald. But Mr. Trump knows. If he’s Honest Donald, he’ll release his tax returns to make sure that voters know that he’s neither dodgy nor deplorable. And if he’s dodgy, he will release his returns so that we know he’s not deplorable. Only Deplorable Donald—the worst possible Trump—has no incentive to disclose.”

Wolfers suspects this might turn potential supporters away.

You actually use this logic every day to make sure you don’t get ripped off. If I were offering to sell you a used car, and refused to let you take it for a test drive, what would you infer? It must be a dud, unable to even start. After all, even if it ran poorly, you would let me drive it, at least to reassure me that it actually does run.

Likewise, you wouldn’t buy stock in a company that refused to show you their books.

This same idea is why you demand the right to inspect a good before you buy it, or if it’s in a box, you demand the right to return it if it turns out to be a dud. You can’t return presidents, which is why voters have traditionally demanded the right to inspect them first.

While they may not show a complete picture of the man, Trump’s tax returns would reveal some important facts. For example, what percentage of his income and his wealth goes to taxes? Does Trump pay any taxes at all? How much money does he appear to be making, as compared to the $10 billion he has claimed? And, finally, is Trump really the ardent philanthropist he makes himself out to be—or, as we have previously suggested may be the case, has he given almost none of his own money away?

Let’s talk first about the issue of taxes—which, after all, is a major indicator of someone’s approach to personal civic responsibility. In other words, does Trump freeload off the taxes of working people who live far more humble lives? Nancy Benac writes for the Associated Press that Trump boasts, “Nobody knows more about taxes than I do—maybe in the history of the world.” Nevertheless, he also says that he tries to pay “as little as possible.” David Cay Johnston, author of Temples of Chance, reported that Trump did report negative income early in his career. He writes that Trump made $118,530 in 1977 and paid $42,386 in taxes, but in 1978, he reported negative income of $406,379, which left him owing nothing. In 1979, he reported negative income of $3.4 million and, again, paid no taxes. One wonders how he paid his rent. For his own part, Trump has been quoted as saying only a “really stupid person is paying a lot of taxes.”

But the other revelation in his tax returns might be the extent and the recipients of his charitable giving. Trump has insisted that when he gives he mostly does not use his foundation as a vehicle. His foundation, as we have written previously, appears to be almost nonexistent and badly managed besides, but he has never revealed to whom or how much he donates outside of his foundation, and the itemized charitable donations on his tax returns would reveal that.

But everyone has speculations about what Trump may be hiding philanthropically. Ted Cruz has charged that Trump could be hiding donations to “liberal groups like Planned Parenthood,” but based on what we have seen to date, we would guess that whatever the real story about his philanthropic life is, it’s likely far from the portrait of the “ardent philanthropist” that his campaign portrayed.—Ruth McCambridge