Mitt Romney’s refusal to release his tax returns becomes a more and more curious thing every day. Think about it. Harry Reid has come forth with his allegations that an individual was told by Romney that he had paid no taxes. He’s said it many times, even on the floor of the United States Senate, prompting harsh criticism from Romney, his surrogates, and even Jon Stewart.
Romney has called these allegations false. He claims to have gone back and looked over his returns and confirmed that he’s paid an effective tax rate of at least 13% over the last ten years. Still, he refuses to release the returns. His wife claims that they are hiding nothing, but they would provide the Obama campaign with more ammunition to use against Romney.
This approach makes no sense, because each day that the returns aren’t released allows for the speculation, the bleeding, to continue. So what’s going on?
First, there’s the Reid allegation. Let’s tease this out a bit.
Harry Reid has nothing to lose. He’s approaching 80 and he won reelection to a six year term in 2010. He’s probably seen his name on a ballot for the last time. So he has nothing to lose by making something up, right? On the one hand, yes. He has nothing left to lose, so he is free to make an incendiary allegation with no factual support. That’s not Reid’s style. He has angered the liberal base of the Democratic Party, me included, on many occasions by being too gentlemanly in a political environment that has become undeniably savage.
So is it a Reid who finds a nasty streak late in his career, or is it a Reid who is playing a legitimate card? Of course there are other possibilities. Maybe it’s some kind of false-flag dirty trick by the Romney camp to neutralize Reid and weaken the Democratic organization in the swing state of Nevada. The fact is that we could speculate on any number political cloak and dagger scenarios. At the end of the day, we know little more than that Reid advanced the allegation, and Romney got very upset. Ultimately, either Reid’s source is lying, or Romney is. Reid could produce his source for public evaluation. Romney could produce his tax returns for public evaluation. The damage gets recorded. The damage control teams get to work. The issue gets put to bed and we move on.
Now, I can see why Reid would hold his source in reserve. A credible source coming forward could be a nice October Surprise, but for that to happen, Romney has to cooperate by not releasing his returns. So, why would Romney cooperate?
Based on Reid’s allegation, all Romney would need to do is show that he paid something in Federal income tax over the time period in question for the benefits to start rolling in.
So what are those benefits?
1) A sympathy bounce in the polls for being the victim of a false attack. That could be compounded a bit by the fact that his hurried rollout of Paul Ryan as his running mate, a moved clearly designed to change the subject away from this very topic, yielded nothing in the way of a bounce.
2) Harry Reid, a Democrat with national stature, would be seriously damaged. Now, damage to the highest ranking Democrat in the U.S. Congress is palatable in its own right, but Reid is from Nevada. The state has center-right leanings a best, and I’m sure the center part of that comes from the gambling industry. It’s hardly a bastion of liberalism. Libertarianism? Possibly. Liberalism? No. It’s not natural territory for Obama. Moreover, there is a heavy LDS influence that will spill over from neighboring Utah. For Obama to win in Nevada, he needs Reid and the organization that elected him. Damage to Reid would be damage to his organization and therefore an opportunity for Romney to either win Nevada outright or force Obama to defend it by taking resources from other battleground states like Ohio or North Carolina. It all boils down to the fact that damage to Reid puts Nevada in play, more so than it may or may not be now.
3) An “innocent” tax return ends the conversation, blunting a key Democratic line of attack. We know that Romney paid 13.9% on $20 Million in income. We know he wrote off $77,000 in hobby expenses for his wife’s dressage horse. We know that he has off shore accounts in the Cayman Islands and Swiss banks. By claiming to have paid at least 13% each year, Romney is trying to imply that his other returns are more of the same. If this is the case, then Romney’s tax returns become Al Capone’s Vault, a whole lot of mystery and buildup with little return.
Any or all of these things are benefits that Romney could reap by releasing his tax returns. So why wouldn’t he? Why continue to allow his campaign to bleed on this issue?
Well, Ann Romney said it. The returns would provide added ammunition for the Obama campaign. So the question remains what kind of ammunition?
There’s been speculation along a couple of lines on this question. The first line is that Romney paid little or no taxes, that Reid and his source are in fact correct. Obviously, this would be a big hit against Romney, and it’s unlikely to be that blatant. As far as I can tell, he’s parsed his words to not say that he’s paid income tax, so he could probably try to deflect criticism by saying that he paid no income tax, but he paid plenty of payroll, property and sales taxes. Still, he did say that he went over his tax returns and has always paid an effective rate of at least 13%. That’s a pretty specific claim. Of course, if he never releases his returns and we never learn the truth, then we’d have no way of judging his honesty, unless of course we’re content to just trust him.
Another line of speculation is that he has not given a full 10% of his income to the LDS church, and the tax returns would show that. Apparently, since he’s a bishop, this would get him in pretty deep water with his church. Ultimately, that’s a matter between him and his church, and I’m serious when I say I support religious freedom and separation of church and state. Still, if his reason for letting his campaign bleed from the tax return issue is that he hasn’t put enough in the offering plate, it does raise fair concerns about how independent of his church he would be.
There are other ideas about why he’s so reluctant. The returns would suggest perjury or other criminal activity related to when he left Bain. The returns would show a lot more money off shore than he has disclosed. The returns would show how much money he made and what tax benefits he received by sending jobs overseas. We just don’t know, but he seems to think that the cost to his campaign is greater than the benefit of releasing his returns.
What if it’s something else though? What if it is as he said, that he consistently has an effective tax rate of at least 13%, and that he has faithfully tithed to his church? What if the scandal is the fact that his tax returns would provide a primer on how unjustly that tax code is skewed to allow the ultra-rich to avoid paying their fair share? It could be an education, couldn’t it?
Romney would not be the first wealthy president. He would however be the wealthiest, and it’s not dynastic wealth like that of the Roosevelt’s or the Kennedy’s or the Bush’s. Its wealth largely derived from the very economic conditions that are on trial in this election: venture capital, downsizing, off shoring. His wealth is derived from investing in companies, not to make the company stronger, but to make the investor richer, even at the cost of destroying the company and the jobs and communities dependent on said company…if that’s what would generate the most revenue for the investors.
What if Romney’s returns provide a stark revelation of the secrets of the 1%, secrets built into the tax code and laws of the nation that would be deemed so outrageous by the electorate, that it would be better for Romney to let his campaign bleed than to reveal the truth?
Of course, this is all speculation, but it is speculation that Romney invites by not releasing his returns.