The problem with Mitt Romney's refusal to release tax returns
George W. Romney (father of Mitt Romney) released twelve (12) years of tax returns when he ran against Richard Nixon for the Republican Presidential nomination in 1967-68. He was believed to be the first candidate to release that amount of personal financial data.
The UPI reported at the time, "Many presidential candidates in the past have disclosed their net assets, stock holdings and other financial data which might relate to the public trust. But Gov. Romney was believed the first to make his income tax returns public - including his annual wages, dividends, interest, capital gains and other compensation."
The article mentioned that George Harris, senior editor of Look magazine, asked to see Romney's latest tax filing. Romney hesitated, saying, "One year could be a fluke, perhaps done for show..." Romney then shocked Harris by compiling and releasing all the 1040 forms he and his wife had filed for the past twelve years, including the period of time in which he had become a millionaire while saving American Motors Corp. from bankruptcy.
The information was presented to Look magazine, which published it. According to Look, the Romneys' income for years 1955 through 1966 included $1.2 million in salary and bonuses; $106,820 from deferred AMC compensation; $1.6 million in dividends, interest and taxable capital gains for an adjusted gross income of $2.97 million. They gave $560,608 to their church and $115,205 to other tax-deductible charities. They paid just under $1.1 million in taxes on $2.1 million in net taxable income.
George Romney had plenty of reason to release the returns with pride: he had grown wealthy while saving an American company and many American jobs; he had generously supported both his nation and his religious institution.
With the precedent established by George Romney, it was then followed by nearly every major Presidential candidate in the elections of 1972, 1976, 1980, 1984, 1988, 1992, 1996, 2000, 2004 and 2008. That's ten elections, plus the George Romney precedent-setting one. At this time, anyone contemplating a run for President MUST be aware that he or she will be expected to release tax documents. Any other course would be unimaginable... almost.
George Romney's son Mitt (left) has been an exception. He has broken with that national and family tradition. He never released financial information during his run for U.S. Senate, Massachusetts governor or for President in 2008.
And, if he had his way, he would not have released any data for this campaign. As late as December 2011, he stated, "I don't intend to release the tax returns." Getting repeatedly hammered by his GOP rivals for the nomination convinced Romney to change his position. He released his 2010 tax return. That one, compiled several years after his first run for the Presidency (plenty of time, mind you, to clean up his finances), revealed a $3 million Swiss bank account and additional overseas investments, including large amounts of money in countries known as "tax havens." A recent article noted that fifty-five (55!) pages of Romney's 2010 return (it runs to 203 pages and can be read in its entirety here: www.washingtonpost.com/wp-srv/politics/documents/romney-2010-tax-return.html ) dealt with the details of his financial transactions with foreign companies.
Given the likelihood that Romney did undertake a financial cleanup as part of planning his Presidential campaigns, we're forced to assume that the 2010 return - the only one he released - provides the most palatable view possible of his finances. Still, we have reason to wonder if he knew he was running for President of the U.S. or aspired to a similar post in Ireland or Luxembourg.
Calculations showed that Romney paid about 14% of his income in taxes in 2010. The fact that his income comes almost entirely through what is classified as investment income (the classification is ridiculous in this case, since the income is essentially regular payment for his "services") has lowered his tax obligation from the usual 35% in his bracket to just 15%.
Romney has released an estimate of income and taxes for the 2011 year and said the return would be made public after it is completed. Months after most Americans have filed their 2011 returns, Romney's remains secret (and possibly incomplete).
Personally, I don't care very much what the additional details of the Romney finances are. They won't change my vote. But his behavior on this issue is very troubling. His break with national Presidential tradition and his break with his own family history communicate that there is a serious problem. His continued refusal to release the information, despite the enormous pressure of press, public, rivals and allies, magnifies that problem.
Perhaps there would be some value to a law requiring full financial disclosures by Presidential candidates. I'm not sure about that. (I do know that I do not want to empower the IRS to make the decision of whose tax returns to release. The IRS has enough power to extort already.) I consider the precedent of voluntary disclosure of these personal financial documents to be much more important. President of the United States is a position of enormous responsibility and trust. We learn a great deal about a candidate - one way or another - through his/her handling of this particular hurdle.
The UPI reported at the time, "Many presidential candidates in the past have disclosed their net assets, stock holdings and other financial data which might relate to the public trust. But Gov. Romney was believed the first to make his income tax returns public - including his annual wages, dividends, interest, capital gains and other compensation."
The information was presented to Look magazine, which published it. According to Look, the Romneys' income for years 1955 through 1966 included $1.2 million in salary and bonuses; $106,820 from deferred AMC compensation; $1.6 million in dividends, interest and taxable capital gains for an adjusted gross income of $2.97 million. They gave $560,608 to their church and $115,205 to other tax-deductible charities. They paid just under $1.1 million in taxes on $2.1 million in net taxable income.
George Romney had plenty of reason to release the returns with pride: he had grown wealthy while saving an American company and many American jobs; he had generously supported both his nation and his religious institution.
With the precedent established by George Romney, it was then followed by nearly every major Presidential candidate in the elections of 1972, 1976, 1980, 1984, 1988, 1992, 1996, 2000, 2004 and 2008. That's ten elections, plus the George Romney precedent-setting one. At this time, anyone contemplating a run for President MUST be aware that he or she will be expected to release tax documents. Any other course would be unimaginable... almost.
And, if he had his way, he would not have released any data for this campaign. As late as December 2011, he stated, "I don't intend to release the tax returns." Getting repeatedly hammered by his GOP rivals for the nomination convinced Romney to change his position. He released his 2010 tax return. That one, compiled several years after his first run for the Presidency (plenty of time, mind you, to clean up his finances), revealed a $3 million Swiss bank account and additional overseas investments, including large amounts of money in countries known as "tax havens." A recent article noted that fifty-five (55!) pages of Romney's 2010 return (it runs to 203 pages and can be read in its entirety here: www.washingtonpost.com/wp-srv/politics/documents/romney-2010-tax-return.html ) dealt with the details of his financial transactions with foreign companies.
Given the likelihood that Romney did undertake a financial cleanup as part of planning his Presidential campaigns, we're forced to assume that the 2010 return - the only one he released - provides the most palatable view possible of his finances. Still, we have reason to wonder if he knew he was running for President of the U.S. or aspired to a similar post in Ireland or Luxembourg.
Calculations showed that Romney paid about 14% of his income in taxes in 2010. The fact that his income comes almost entirely through what is classified as investment income (the classification is ridiculous in this case, since the income is essentially regular payment for his "services") has lowered his tax obligation from the usual 35% in his bracket to just 15%.
Personally, I don't care very much what the additional details of the Romney finances are. They won't change my vote. But his behavior on this issue is very troubling. His break with national Presidential tradition and his break with his own family history communicate that there is a serious problem. His continued refusal to release the information, despite the enormous pressure of press, public, rivals and allies, magnifies that problem.
Perhaps there would be some value to a law requiring full financial disclosures by Presidential candidates. I'm not sure about that. (I do know that I do not want to empower the IRS to make the decision of whose tax returns to release. The IRS has enough power to extort already.) I consider the precedent of voluntary disclosure of these personal financial documents to be much more important. President of the United States is a position of enormous responsibility and trust. We learn a great deal about a candidate - one way or another - through his/her handling of this particular hurdle.
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