Tax bombshell reveals Trump's image is a sham

According to a new report by the New York Times, President Donald Trump paid just $750 in federal income taxes in 2016, the year he took office. CNN's John Harwood has the details.

Posted: Sep 28, 2020 6:50 AM
Updated: Sep 28, 2020 6:50 AM

It was the moment when Donald Trump's "Art of the Deal" fabulism, billionaire tycoon bluster and populist standard-bearing for forgotten Americans was revealed to be what it always looked like: a sham.

A stunning New York Times exposé of the President's tax returns Sunday revealed a pitifully inept businessman and a serial tax avoider crushed by massive debts that could expose him to conflicts of interest given his position as President and power to help undisclosed lenders.

Trump refused to talk about his tax returns and blasted the Times report as "totally fake news" on Sunday. But the article portrays the anti-elite crusader who rails against a corrupt system as actually using its loopholes to avoid paying any federal taxes at all in 10 of 15 years beginning in 2000 by writing off his own staggering losses.

In 2016 and 2017 each, Trump paid just $750 in federal income taxes -- far less than many Americans who are working hard amid a deep recession to stay afloat. Trump took huge deductions -- including $70,000 to take care of his hair -- and also appeared to write off hundreds of thousands of dollars paying his daughter Ivanka as a consultant to the Trump Organization, according to the Times report. The story also reveals the extent to which Trump's status as President is being used to shore up his losing ventures — for example his hotel in Washington, DC, and his golf resorts.

View Trump and Biden head-to-head polling

"This is a con man in the White House," presidential historian Douglas Brinkley told CNN Sunday, referring to a President who shattered convention by refusing to release his tax records to the public while running for office.

Tony Schwartz, who penned Trump's book "The Art of the Deal," said even he was surprised by the "sheer brazenness" of Trump's behavior, remarking to CNN's Anderson Cooper that it revealed the "kind of mind that would think 'I can get away with paying no taxes on hundreds of millions of dollars in income.'"

The publication of the deeply reported article, based on more than two decades of his tax information obtained by The Times, comes just two days before the first presidential debate and 37 days before an election in which he is trailing Democrat Joe Biden. It poses a grave challenge to a presidency that we now know Trump may need to preserve to outrun creditors with hundreds of millions of dollars in loans soon coming due.

It leaves the President facing multiple questions about his morals, behavior — and patriotism since he appears to be paying more in taxes to several foreign nations than he is to Uncle Sam. The reporting also raises the possibility that Trump's deceptive accounting, already the focus of several investigations in New York, could open him up to serious legal issues when he leaves office.

The Times report, for instance, says that the President has been battling the Internal Revenue Service for years over whether losses he claimed should have resulted in a staggering tax refund of $73 million.

A debate opening for Biden

In the short-term, the New York Times report gives Biden a golden opportunity to put Trump on the defensive during their first debate in Cleveland, Ohio, on Tuesday evening.

In recent days, Biden has sought to undermine Trump's good approval ratings on the economy by billing the election as a contest between Scranton, Pennsylvania -- where he was born -- and Park Avenue. Trump's complicated and self-serving tax arrangements play directly into this construct. While the President's most loyal devotees may not be shifted by such an attack, it is hard to see how it does not damage him among wavering blue-collar voters in the post-industrial heartland in states like Michigan, Pennsylvania and Wisconsin, which are crucial to Trump's narrow pathway to 270 electoral votes.

Biden campaign communications director Kate Bedingfield told CNN on Sunday that the report clarified the contrast between the President and the Democratic nominee.

"You have in Donald Trump a President who spends his time thinking about how he can work his way out of paying taxes of meeting the obligation that every other working person in this country meets every year ... with Joe Biden you have somebody who has a completely different perspective on what it means to be a working family in this country," Bedingfield said.

The key figure -- that Trump paid just $750 in taxes in two straight years -- might be the most damning, since it is so identifiable and strikes such a clear comparison to the larger figure almost all Americans pay. If a man with his own airliner, gold-leafed homes and string of golf resorts can get away with that, who is to argue that system is not irretrievably biased against regular people?

"I'm telling you there are people out there, and I know, I come from blue collar, hard-working, these folks are scraping to make a living and they're going to wake up and find this incredible mogul paid $750," said former Ohio Republican Gov. John Kasich, who is now a CNN political commentator.

"I don't care what his excuses are. It doesn't pass the smell test. It's not going to disrupt those people who were for him totally. It's those people on the fence," Kasich said.

Within hours of the report's publication, the Biden campaign had already put vinyl stickers up for sale on its website — reading, "I paid more income taxes than Donald Trump."

The report also sheds some light on the President's clear desperation to cling to power. He, for example, intensified his false claims on Sunday that Democrats were trying to steal the election, making a new and factually empty assault on mail-in ballots that he claims are plagued by massive fraud.

The Times reports that within the next four years, more than $300 million in loans -- for which Trump is personally responsible -- will come due. That opens the extraordinary possibility that the lenders could be called upon to decide whether to foreclose on businesses owned by the US President while he is in office if he is unable to pay the money back. Trump is therefore in danger of becoming deeply compromised.

His personal debts also underscore a long-time fear about his administration -- that he is managing US diplomacy in order to prioritize his own personal and financial goals rather than the wider national interests. Trump, for instance, derives millions of dollars in income from countries like Turkey and the Philippines that are led by autocrats whom he has praised but who infringe traditional US values like human rights. And while he has paid little federal tax to the Treasury, the President or his companies have paid more in taxes to foreign powers, including $145,400 to India and $156,824 to the Philippines in 2017.

Trump's supporters likely to be unmoved

With the election so close, the President needs to spend every day trying to destroy the Democratic nominee's credibility — even as he tries to escape the consequences of his disastrous management of a pandemic that has killed more than 200,000 Americans and is again gathering strength. But the story of his taxes may defy even a distraction artist as proficient as the President.

Trying to deflect from the New York Times report, Trump at a Sunday news conference touted his new Supreme Court nominee Amy Coney Barrett and issued another demand for Biden to submit to a test for performance enhancing drugs before they clash in the debate.

Yet given Trump's strong emotional and tribal connection to his followers, his success in constructing alternative political realities while discrediting journalists, and the propaganda from conservative media, the October-surprise style bombshell may have less immediate political impact than might be expected.

Stories about Trump's refusal to pay his creditors, casino bankruptcies and morally questionable business practices have been circulating for years and did not stop him from winning in 2016 or tarnish his self-created mystique as the hard-driving real estate shark that he portrayed on NBC's "The Apprentice."

Throughout a tumultuous political career, Trump has rarely paid a price for scandals, outrages and insults — any one of which would have doomed a normal politician. His brand is well known; he is a rule breaker. And in the past, he has explained that avoiding taxes shows he is a smart businessman and is an approach anyone would take if they could. On Sunday, Trump quickly adopted his characteristic tactics to try and pass off the hugely serious revelations as nothing to concern voters.

"It's fake news. It's totally fake news. Made-up, fake. We went through the same stories, you could've asked me the same questions four years ago," the President said, again inaccurately saying he couldn't release his tax returns because he was under audit.

"I mean the stories that I read are so fake. They're so phony," he said, claiming to pay a lot in taxes.

The Trump Organization's lawyer, Alan Garten, told the Times that "most, if not all, of the facts appear to be inaccurate" and requested the documents.

Terre Haute
Overcast
48° wxIcon
Hi: 68° Lo: 39°
Feels Like: 43°
Robinson
Overcast
45° wxIcon
Hi: 66° Lo: 37°
Feels Like: 38°
Indianapolis
Overcast
46° wxIcon
Hi: 73° Lo: 42°
Feels Like: 40°
Rockville
Overcast
42° wxIcon
Hi: 66° Lo: 38°
Feels Like: 34°
Casey
Overcast
45° wxIcon
Hi: 54° Lo: 37°
Feels Like: 37°
Brazil
Overcast
48° wxIcon
Hi: 73° Lo: 39°
Feels Like: 43°
Marshall
Overcast
48° wxIcon
Hi: 62° Lo: 38°
Feels Like: 43°
Breezy & Colder
WTHI Planner
WTHI Temps
WTHI Radar

WTHI Events

 

Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Confirmed Cases: 363740

Reported Deaths: 9647
CountyConfirmedDeaths
Cook1700395390
DuPage21776605
Lake20042507
Will17616425
Kane16038345
Winnebago9736179
St. Clair7759216
Madison6957153
McHenry5943120
Champaign589328
Peoria438868
McLean399731
Rock Island382289
Sangamon372262
Unassigned3631260
Kankakee328878
Macon279449
Kendall255528
Tazewell252252
LaSalle228161
DeKalb221342
Coles182838
Williamson180059
Boone177425
Adams173015
Clinton168725
Vermilion16198
Jackson149126
Whiteside129725
Randolph122015
Knox119016
Ogle11377
Effingham11214
Grundy9237
Franklin9138
Marion89617
Jefferson88845
Monroe88428
Bureau87917
Morgan86524
Stephenson8657
Henry8207
Christian80027
Macoupin76010
Union74625
McDonough70817
Fayette66022
Lee6581
Crawford6396
Shelby63111
Douglas6048
Livingston59710
Montgomery58715
Woodford56814
Logan5664
Saline5249
Bond4839
Warren4747
Wayne47312
Iroquois46819
Jersey46721
Jo Daviess4617
Fulton4601
Cass45511
Perry41516
Moultrie3905
Carroll3839
Johnson3320
Richland32516
Lawrence3238
Pike3044
Clay29813
Mason2941
Clark29210
Hancock2924
Washington2891
Greene28015
Cumberland2626
Jasper25810
De Witt2484
White2482
Mercer2376
Pulaski2301
Piatt2240
Wabash2165
Ford18711
Menard1711
Edgar1508
Massac1462
Marshall1423
Henderson1210
Hamilton1142
Alexander1131
Gallatin1062
Brown1030
Edwards1010
Scott1000
Putnam880
Schuyler841
Stark832
Calhoun670
Hardin530
Pope381
Out of IL50

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Confirmed Cases: 155246

Reported Deaths: 4065
CountyConfirmedDeaths
Marion25151785
Lake13570355
St. Joseph9145161
Elkhart8759135
Allen8129228
Hamilton6117113
Vanderburgh576760
Tippecanoe369515
Hendricks3268133
Monroe325738
Porter313649
Johnson3105128
Clark293961
Delaware293274
Vigo260538
Madison235093
Cass224022
LaPorte222858
Warrick192965
Kosciusko182625
Floyd179167
Howard162466
Bartholomew141558
Dubois138626
Marshall137426
Wayne126930
Henry125429
Grant125339
Boone122250
Hancock118245
Noble115933
Jackson112915
Dearborn94928
Morgan93740
Lawrence87436
Daviess87133
Gibson87111
Clinton84716
Shelby81730
LaGrange80115
Harrison76224
Knox75610
Putnam72816
Posey7146
DeKalb71011
Fayette66618
Steuben6278
Miami6095
Jasper5945
White58515
Montgomery58322
Greene53337
Scott51813
Decatur50439
Adams4837
Whitley4556
Clay4467
Ripley4418
Sullivan43714
Wells4288
Wabash4119
Starke4077
Orange40425
Huntington3905
Spencer3906
Washington3753
Franklin37225
Jennings36713
Fulton3523
Randolph3529
Jefferson3415
Pike33018
Carroll32513
Perry31014
Jay3056
Fountain2943
Tipton27523
Vermillion2411
Parke2323
Newton22511
Rush2154
Blackford2093
Owen2051
Martin1990
Crawford1581
Pulaski1521
Brown1393
Ohio1297
Benton1100
Union1100
Switzerland920
Warren781
Unassigned0234