louis c's Journal
Home country: USA
Current location: Boston
Member since: Fri May 14, 2004, 05:52 PM
Number of posts: 4,807
Home country: USA
Current location: Boston
Member since: Fri May 14, 2004, 05:52 PM
Number of posts: 4,807
- 2016 (17)
- 2015 (13)
- 2014 (9)
- 2013 (26)
- 2012 (73)
Donald Trump and the Art of the Tax Loophole
Steven Rattner MAY 13, 2016
Credit Eric Thayer for The New York Times
TYPE “Trump system rigged” into the Google search bar and you’ll get more than 500,000 hits. I didn’t inspect all of them but the first 50 were variants of Donald Trump complaining that the Republican primary process was tilted against him.
That’s beyond ironic. Mr. Trump and his family have been the beneficiaries of a great rigged system: the tax code, which bestows huge advantages on the real estate business. Throughout his career, Mr. Trump has not only grabbed for every loophole and legal lever he could find, he’s boasted about it.
“I’ve taken advantage of the laws of this country, like other people,” Mr. Trump has said.
The Republican front-runner has been dodging releasing his returns on the specious grounds that he was being audited. On Tuesday, he told The Associated Press that he wouldn’t release them before the election — period. On Wednesday, he denied saying this, reversed course and said,“Hopefully before the election I’ll release.”
“There’s nothing to learn from them,” he said in the Associated Press interview.
I’ll bet there’s plenty to learn. More likely, Mr. Trump doesn’t want us to know how small his tax hit is, something that he bragged about earlier in the campaign, before realizing that it could come back to bite him.
“I fight like hell to pay as little as possible,” Mr. Trump said last August.
Real estate guys can take advantage of the best loopholes left in the tax code, thanks in part to some aggressive nudging of lawmakers. For starters, real estate investors can take deductions for the ostensible depreciation of the value of their buildings, even though the point of owning buildings is that they generally appreciate.
For another, they often borrow against those properties, and because they hold these investments in partnerships or limited liability companies, the interest payments are tax-deductible.
“If you get close to paying taxes, you just buy another building,” a real estate friend told me.
If Mr. Trump were to sell a property, the profits would be taxed as capital gains at far lower rates (23.8 percent) than those imposed on ordinary income (39.6 percent). But real estate owners often don’t even pay capital gains taxes. They can take advantage of a provision known as Section 1031 to swap a piece of real estate that they are ready to part with for one that they would like to add to their portfolio — all tax free. There is no limit on how many swaps they can make, deferring capital gains taxes indefinitely.
Section 1031 is among the real estate operators’ favorite provisions — and it’s a break not readily available to other kinds of investors. No wonder that attempts to rein in or eliminate Section 1031, including a recent one by the Obama administration, have been met with fierce resistance from the industry.
The tax benefits don’t stop, even at death. If an investor dies holding appreciated properties, the heirs get a step up in basis, which means that they can sell the real estate and pay no taxes on the gain in value.
Mr. Trump’s quest for loopholes ranges far. In 2005, he got a $39.1 million tax deduction for donating a conservation easement on a New Jersey golf course, meaning that any further development on the property is restricted. On top of that, he installed goats on two of his New Jersey golf courses as part of a plan to get them designated as agricultural properties, thereby vastly lowering his property taxes.
Meanwhile, according to Mr. Trump’s campaign, from 2010 to 2014, he “donated” more than $102 million to charity — without giving away even $1 of his own money. More conservation easements constituted the biggest source of deductions, but the “gifts” included items like free rounds of golf for charity events. Many of these “charitable contributions,” of course, gave rise to more tax deductions.
Taxes are far from the only way that Mr. Trump has gamed the system. He’s added materially to his net worth by pushing the edges of the bankruptcy laws.
By arguing that his name had huge commercial value, for example, he managed to retain more ownership in his Atlantic City hotel and casino projects than is customary in an insolvency, thereby minimizing his losses while his creditors lost billions.
Finally, by his own admission, Mr. Trump has used our broken campaign finance system to achieve private gain by giving generously to politicians of both parties (including to Hillary Clinton) in order to gain influence. Since 1989, he has donated more than $1.5 million to political causes, 62 percent of it going to Republicans, according to PolitiFact.
“When they call, I give,” Mr. Trump said in the first Republican debate. “And you know what? When I need something from them, two years later, three years later, I call them. They are there for me.”
Among the ways that politicians have been there for him and his brethren has been developing a tax system in which real estate moguls pay little or no taxes. “The Declaration of Independence tells us that all men are created equal, but the government definitely favors real estate investors!” wrote one such investor, David Lindahl. Where did this appear? “Trump University Commercial Real Estate Investing 101.”
Posted by louis c | Mon May 23, 2016, 06:13 PM (9 replies)
For starters, let's admit that the Republicans and the corporations that fund them are brilliant strategists and patient men (and sometimes women). They are fueled by greed and they are long term thinkers. They don't want to destroy the middle class for fun.They do it for greed.
In order to succeed, they need to enlist the people they want to destroy as accomplices, and sometimes their allies, the Democrats.
Let's begin with a fact. The Middle Class of America has shrunk over the last 45 years at very nearly the same rate as labor unions have diminished http://www.huffingtonpost.com/2013/09/18/union-membership-middle-class-income_n_3948543.html
That's no coincidence. The middle class was built by organized labor and the middle class cannot be destroyed until organized labor is eliminated.
How did this happen? Let's look at what the numbers are. In the forties and fifties and sixties, union members voted their pocket books. Even when Eisenhower and Nixon were in office, unions thrived, because no politician wanted to screw with them. The rules, as set by legislation and adjudicated by the Labor Board and Supreme Court, protected workers in organizing into a union and in their employment.
A vast majority of the very wealthy and very greedy know how to vote in their own best interest. But they only make up, by my estimate, about 10% of the voters. Those groups and individuals then have to come up with a strategy on how to split the remainder of the voters (90%). That's when wedge issues began. Abortion, Guns, Flag Burning, Prayer in School, Civil Rights and Gay Rights were used to get working class voters to take their eye off of the ball and vote AGAINST their own economic interest.
The Right, especially under Reagan, started to turn the Supreme Court from a judicial body, to what it is today, a political body. It's not where anyone goes for justice, it's just the last political word in the country.
Then, with everything set and union workers voting at diminished and divided rates, putting anti-worker laws in place and having them upheld by pro-corporate, anti-worker labor boards and an increasingly worker-hostile Supreme Court was an easy step. Workers could be fired for what used to be protected activity, organizing into a union. Then, sinister "Right to Work" laws became law in every state that had a Republican majority in the State House and Senate and a Republican Governor. That meant that any union member could have all the benefits and protection of a union without paying a penny in dues. The only entity in America that was required to perform a service, by law, for free, or face the wrath of the federal government, are labor unions. How ingenious. Human nature, being what it is, allows a person to receive something for nothing. Even hospitals, that are required by law to service any injured or ill person in an emergency room, is reimbursed by a pool from insurance companies or the government. In right to work states, unions collapsed. In the South, some states have union density of less than 1% of their workers.
The Republican platform and speeches are replete with "get the government out of the way and every American can live up to his or her potential". "Be judged on your own merit and you don't need an advocate." Ya, sure. The only way for nearly every average worker, skilled or unskilled, to have any leverage with a business or corporation, is to collectively bargain.
Once again, we see this sinister plan play out. Only this time, we may be seeing the final act. What a nerve Republicans have to say that this recovery is not complete because wages are stagnate. No shitting. I represent 35 contracts, in both the public and private sector in the Greater Boston area, totaling about 850 union workers. I've been in this position for about three years, and we've negotiated about 25 of those contracts as they become due (most contracts are three years in duration). Every contract has had raises of between 2 and a half percent to 5 percent annually. Very few, if any, of those people would have received any raise without a union representing them. Most would not have even asked. The wage stagnation during this recovery is a direct result of weakening unions.
In January of this year, labor unions were on the verge of extinction, especially in the public sector. The Fredrick case, which would have allowed a California teacher to receive all of the benefits of the teachers' union accumulated over many years, without paying any dues, or even a fee, was before the 9 member Supreme Court. The arguments were heard in January, and we were sure to lose with the 5 Republican appointees voting against labor unions and the 4 Democratic appointed Justices voting to sustain the current law which requires payment for services. In February, Scalia died. in March the vote was 4 to 4, leaving the precedent in favor of the union to stand, for now.
Is it any wonder that the conservative, corporate Republicans are flocking to Donald Trump now that he has promised them a Supreme Court Justice of their choosing?
If we go from 26 right to work states to 50, due to this ruling, labor unions will not exist in ten years. With no union protection, America will resemble 1910, rather than our economic glory years of 50 years ago. We will be a Feudal America again, with the vast divide between the haves and the have not's. A whole century of the struggle to make the great American Middle Class will cease to exist in our life time and maybe never return.
So, in closing, that's what's at stake in this election. We need a Democratic President, not because Democrats have been our best friends, but because at least they will allow us to live to fight another day. As a union leader I like to explain my position to our members this way when I am confronted with how often Democratic politicians have let us down. This is what I say "The Democrats are destined to disappoint us, but the Republicans are dedicated to destroy us. All I want is a chance to live to fight another day."
Posted by louis c | Fri May 20, 2016, 09:04 PM (17 replies)
I sent a check 6 weeks ago for $25 to regain my star membership.
Could you please tell me the status?
Posted by louis c | Mon May 9, 2016, 07:39 PM (1 replies)
I have tried to reach you through the normal means, like through the DU mail system, for more than a month.
I sent a $25 check 6 weeks ago and still await my "star" membership.
I am a 12 year member and have contributed regularly. Please let me know if everything is OK.
Posted by louis c | Sun May 8, 2016, 01:37 PM (2 replies)
.....if he was running for the presidency of Argentina
Posted by louis c | Sun Mar 27, 2016, 08:35 AM (3 replies)
As the Republican Party is strategizing to stop Donald Trump, the Conservative Wing of the party is preparing to run a third party candidate if Trump does win the Republican nomination. They may settle on Scott Walker.
If that's the case, Hillary Clinton, the most likely Democratic nominee, will carry nearly every state in the union. By the way, I love Bernie (but voted for Hillary) and I can't ignore the obvious or the danger of not uniting in this very dangerous time.
Georgia, North Carolina, Virginia, Florida and every swing state. A solid win in every state carried by Obama. Carry the Senate and pick up House seats. This could be a defining moment in American Political History.
Link to Boston Globe Story:
Posted by louis c | Sun Mar 20, 2016, 07:02 AM (66 replies)
My discussions with Trump supporters are such that I can't get a word in edgewise.
So, I would like to state here what I want to say to them, but they won't listen.
I'm 63 years old, so I am close to Trump's contemporary, in age.
Let's discuss me and Viet-Nam. I came of age during the Viet-Nam War era. I was politically active in 1968, even though I was only 16 years old. I stood against the War. I believed then, and believe now, that there were Patriots on both sides of that issue. Protesters lost they're lives and they're freedom fighting for what they believed in and so did those brave soldiers who went to war. In 1970, as a student in Massachusetts, my draft number was 104. Every man today remembers their number in the year they turned 18. The call, in my Congressional District, came up to 94. I don't know what I would have done if it reached me, but the War was winding down, so that decision never had to be made.
I describe this, because Donald Trump likes to act like some sort of savior to veterans and an ardent worrier should the time come. 5 deferments for the guy who is 5 years older than me, meaning his number did come up, and he made his decision. If he rallied against the War I would respect that, for, after all, the War was wrong. The War was the defining issue of our generation.
Instead, here is Trump's take of what he did during that period of American history: "I've been so lucky in terms of that world (contracting Sexual Transmitted Diseases from sleeping around). It's a dangerous world out there. It's scary, like Viet-Nam. Sort of like the Viet-Nam era. It was my personal Viet-Nam. I feel like a great and brave soldier."
Then we move to illegal immigration. There are so many stories of his importing foreign workers to his American businesses that not to see his hypocrisy is mind boggling. The best example is his use of 200 illegal Polish immigrant workers hired to demolish a building so he could erect his signature project "Trump Towers". He paid these undocumented workers $5 an hour, worked them 7 days a week, without overtime. He was caught and brought to court. He settled for a reported $1,000,000.
Some advocate against illegal immigration.
Finally, Trump's diatribes against outsourcing and vilifying America's trade deals. I buy American as often as I can. I hate our trade deals so much, I voted for Perot, Twice. But I never have read a word from Trump, in real time, of his criticism of NAFTA or the trade deals at the time that really mattered, from 1988 to 1994.
Instead, we see that he had no trouble putting profit ahead of Patriotism, as he outsourced his own line of clothing and work to foreign countries, like China and Mexico
It all comes down to this. For the 50 years that Donald Trump has been an adult American citizen, he can't point to a single day that he put this country first.
I have been asked by some of my more intelligent friends, "what historical figures remind you of Donald Trump."
My answer is, "he seems like a cross between Adolf Hitler and Bernie Madoff"
I guess that would make Donald Trump the equivalent of Adolf Madoff
Posted by louis c | Sat Mar 19, 2016, 06:21 PM (5 replies)
I am 63 years old and remember quite well the turbulent and violent year of 1968. That's what this is starting to feel like. Also, I am not too tech savvy. I can work a cell phone and an email, but that's just about it and I have no grand-children to teach me.
But, I have a great idea for a couple of commercials and I was hoping that somebody here would like my ideas and run with it.
Here it is:
30 Seconds (or, maybe, even 15);
Split Screen. On the left side is old footage of Hitler at Nuremberg. At the podium, raising his arm and then his massive audience raising theirs, in the Hitler oath of allegiance. All in black in white. On the right side of the screen, with color removed, so the shot is also black and white, is Donald Trump. Hand raised in an oath, with his large crowd with their hands raised in the same pledge. Both sides look eerily similar. However, the only voice you hear is Adolf's, in German, no sub-titles, but you hear him say "Adolf Hitler" and the crowd reply in kind. You still see Trump, on the right side of the split screen, mimicking the Furor. The scene then fades and the words appear in white lettering on black background, no voice over, just silence. The words on the full screen read "Don't think for a moment that it can't happen here."
Footage of Trump urging his audience to violence. The scene of the black girl being jostled and Trump yelling "out, get them outta here". Then another of Trump saying "I'd like to punch him in the face" and the footage of the sucker punch to the African-American walking in the aisle. Trump talking about taking "them out on a stretcher" and Trump urging the crowd on by saying he would pay for the legal bills. You know all the footage.
Then a black and white image of a very good Abraham Lincoln look alike with a tear coming out of his eye and trickling down his face. The picture freezes on Abe's face with a voice over of, say, one of those highly recognizable voices. The voice proclaims, "what do you think, he would think?."
Posted by louis c | Tue Mar 15, 2016, 05:37 PM (2 replies)
I thought I'd look at the numbers of actual voters to see just how popular Donald Trump really is.
Actually, it's Hillary by a wide margin.
Total Votes for Hillary Clinton: 4,993,944
Total Votes for Donald Trump: 4,333,901
Total Votes for Ted Cruz: 3,428,425
Total Votes for Bernie Sanders: 3,280,260
When we exclude states that have only voted for one party or caucus states that count votes differently for each party, the totals are:
Total Votes for Hillary Clinton: 4,936,431
Total Votes for Donald Trump: 4,095,949
Total Votes for Ted Cruz: 3,314,554
Total Votes for Bernie Sanders: 3,199,589
Source: New York Times:
Posted by louis c | Sat Mar 12, 2016, 06:59 PM (10 replies)
I watched Joe Scarborough say this morning on MSNBC that he didn't think the Trump pledge was a big deal, after all, newly sworn in immigrants also raise their right hands to pledge, and nobody thinks they're Nazi's.
Then I just heard another moron on Fox News say that people in court raise their right hands in court, and certainly that's not Fascist.
Don't they get it? The Trump pledge is akin to Hitler's because it is a mass pledge to an individual.
A pledge to God, country or an organization is not a mass pledge to an individual, and is generally acceptable.
A pledge to an individual is not acceptable, except to your spouse.
Posted by louis c | Tue Mar 8, 2016, 06:47 PM (7 replies)