Last month, Republicans announced their plan for a comprehensive overhaul of the United States federal tax code, the first in decades. In characteristic fashion, President Trump promised, “I don’t benefit. I don’t benefit.” To clarify his point, he added, “I think very, very strongly, there’s very little benefit for people of wealth.” Lest those statements left any doubt, Trump later claimed, “I’m doing the right thing and it’s not good for me, believe me.” Notwithstanding the President’s promises, a New York Times analysis found that Trump could save over a billion dollars if his plan were to be passed into law. Seemingly responding to this reality, Trump later amended his sales pitch by claiming that “everybody benefits” from tax reform.
Tax reform fits squarely into the third category of conflicts tracked by this blog: government regulatory and policy decisions that benefit Trump and his family businesses. Americans deserve to know how the President would personally stand to gain if his proposal became law. Yet the extent of Trump’s conflict of interest remains unknown, and unknowable, because of his widely-criticized refusal to release his tax returns.
Unfortunately, California Governor Jerry Brown squandered an opportunity to force Trump to shed some light on his personal finances when he vetoed the Presidential Tax Transparency and Accountability Act, which had passed both houses of the state legislature with overwhelming support. The Act would have required all aspiring Presidential candidates to provide their tax returns to the California Secretary of State (who would then publish them online) before the candidate’s name could appear on the California primary election ballot. In his veto message, Governor Brown explained that while he “recognize[d] the political attractiveness—even the merits—of getting President Trump’s tax returns,” he worried about the “political perils of individual states seeking to regulate presidential elections in this manner.” Brown identified two specific concerns about the bill: its constitutionality and the potential “slippery slope” it might create.
Brown’s arguments ring hollow. They seem particularly unjustified in a time in which state action is one of the few viable bulwarks against Trump’s corruption. Fortunately, other states, including Massachusetts and New York, are considering similar proposals. Those states can do better than California. Here’s why they should:
- Transparency is vital. We expect our democratically elected politicians to represent the interests of their constituents—not govern like feudal lords seeking to enrich themselves. Richard Nixon began the modern trend of Presidents releasing tax returns when he did so while undergoing an IRS audit. That move allowed him to claim that he was being transparent (and famously, “not a crook”). While IRS rules require the President and Vice President’s tax returns to be audited every year, ensuring compliance with existing tax law doesn’t boost transparency or prevent corruption.
- The requirement is reasonable. Part of the cost of running for President is sacrificing a great deal of your privacy. But that’s understandable: when you ask millions of people to vote for you, they naturally expect to have more information about who you are. In vetoing the California bill, Governor Brown warned of a slippery slope—that tax returns might lead to “years of health records” or “high school report cards” or a “certified birth certificate” being required. I don’t find that to be a convincing excuse to simply do nothing while Trump rearranges the federal tax code to pass along more of his wealth to his children. For one thing, Brown’s examples bear little resemblance to tax records, which serve the important purpose of revealing potential conflicts of interest and have been disclosed by custom for decades. For another, an engaged media, the political process, and the courts all stand in the way of states attempting to implement any of his examples, which are significantly less policy-related and more intrusive and personal than tax returns.
- It just might work. It doesn’t matter that only “blue states” are likely to consider this legislation. Trump won the California, Massachusetts, and New York primaries; together, they gave him nearly a quarter of the delegates he needed to win the nomination. If just a handful of influential states institute tax return requirements, Trump will be faced with a real dilemma: embrace transparency or allow another Republican candidate to scoop up a significant number of delegates.
- The constitutional challenges are winnable and worth fighting. In his veto message, Governor Brown expressed concerns about the constitutionality of a state law requiring that presidential candidates disclose their tax returns before they can appear on the ballot. And yes, such a law is likely (perhaps certain) to draw lawsuits from the Trump campaign. But prominent constitutional scholars, including Erwin Chemerinsky and Larry Tribe, have argued that the law is constitutional. And even if, in the worst-case scenario, a ballot access law were to be struck down as unconstitutional, that would just put us back in the same place as we started, while in the process drawing even more attention to the opacity and potential corruption of the Trump administration.
I’d venture to say that the President’s tax plan is the most significant conflict of interest we’ve tracked here since his election. With it, he has the real opportunity to use his power to reap billions of dollars for himself and his heirs, while the public is none the wiser. But states’ independent constitutional authority to regulate elections provides an effective means to promote greater transparency about this likely conflict—which, one hopes, might stimulate greater accountability.
Hi Jacob, Thanks for highlighting this! I agree that this sounds like an important measure, especially for combatting corruption related to the Trump administration. One question I have is whether it’s really true that a lost constitutional battle over this issue would just mean a return to the status quo. It seems that, aside from potentially creating “bad law,” it would take a significant investment of time, effort, and money for California to engage in this legal battle. It may well be worthwhile, but do you think part of what’s motivating Gov. Brown is a concern about the use of limited state resources in litigating this issue? Could it be a strategic decision in favor of pursuing other avenues for states to combat presidential corruption, perhaps in areas where the legal footing is stronger?
Liz, thanks for the thoughtful comment. While I normally think it’s important to avoid creating “bad law” in the pursuit of a cause, I have a hard time seeing what the damage would be here–it’s a pretty discrete area of law, with minimal precedent, and an adverse ruling (even from the Supreme Court) wouldn’t seem to have much spillover effect (other than preventing these type of laws in the future, which won’t ever exist in the first place unless someone tries to implement them). Certainly state resources are limited. But my guess is that a number of lawyers in the California AG’s office would love to litigate this case–and that they could get substantial help (or even outsource the case, if resources are truly stretched thin) from other lawyers eager to offer their expertise pro bono in order to push back against presidential corruption.
Reblogged this on Matthews' Blog.
Hi Jacob! Thanks for your insightful post. I’m curious to hear why you think this California legislation is restricted to the President instead of including other senior elected officials? It seems that the parallel New York legislation you reference applies to the Vice President, Senators from New York, Governor, Lieutenant Governor, Comptroller, and Attorney General. As states consider such legislation, do you think it is more beneficial to see legislation like that in New York (including other senior elected officials) or like that in California (applying only to the President)?
Thanks for bringing this up and for your comments! I agree with your premise that states are a powerful mechanism by which we can put a check on the President. To Governor Brown’s examples, I can think of many examples of candidates customarily disclosing personal information, like a physical exam (which Trump did in 2016 and GOP lawmakers considered requiring). This seems just as, if not more, important information for constituents. What do you make of Governor Brown’s line drawing problem? Is it that anything helpful for citizens to scrutinize public officials should be subject to citizen review? Anything related to corruption? I agree with you that this case provides a clear example of what information citizens should have, like a physical, but should a standard be created to sort out future types of information, like historic Facebook profiles?
Seems bizarre that Gov. Brown would veto a bill for its purported unconstitutionality when there’s a separate branch of government whose job is to police these things…
Fascinating post, thank you so much for writing. I wonder if California’s measure (as well as those of New York and Massachusetts) included disclosure requirements for other officials, including Congresspeople and state-level representatives. It seems that transparency is just as important for these officials as the President, and starting with them may be a good way to revive the financial disclosure norm which Trump did so much damage to this election.