Senate Minority Leader Chuck Schumer recently signaled that Senate Democrats might have a rather interesting bargaining chip if the Republicans are really serious about wanting a massive tax reform deal later this year. Schumer hasn't totally drawn a line in the sand over the issue yet, but I personally think this would be a good line to draw: force the public release of Donald Trump's tax returns, or Democrats will not deal on tax reform, period. In fact, this week would be the perfect week to make such a demand, since millions of Americans are currently struggling to fill out their own income tax returns before next week's deadline.
Schumer should go on one of the Sunday morning talk shows this week and say something along the lines of the following:
You know what? I think every American who is currently filling out their income tax returns deserves to see President Trump's taxes. So I'd like to announce that Senate Democrats will have no interest in making a deal with Republicans on tax reform unless part of that deal is the public release of Trump's tax returns for 2015 and 2014. If we're going to negotiate over how to change America's tax system, then the public deserves to know precisely how each proposed change will personally affect the president. It's only fair, after all, and we don't think this is too much to ask.
Other than signing such legislation, Trump himself wouldn't even have to be part of the deal, because Congress already has the power to release the president's full tax returns to the public. Trump would be put into an impossible political position if he refused to sign a tax reform deal solely because he refused to let the public know how such a deal would affect his finances. Two years of Trump's taxes is not too much to ask (although this should definitely include 2014, to cover the year before Trump declared his candidacy).
Currently, Schumer is merely floating the idea as a possibility. Here's what he had to say to reporters yesterday about the idea:
Senate Minority Leader Charles E. Schumer (D-N.Y.) is warning that President Trump needs to release his personal tax returns if he hopes to achieve comprehensive tax reform in the coming months.
"It's going to make tax reform much harder" if Trump doesn't release his returns, Schumer told reporters Tuesday. Anytime the president proposes something on tax reform, "the average American is going to say, 'Oh, he's not doing that because it's good for me, he's doing it because it's good for him.' So for his own good, he ought to make them public. And the big mystery is why he hasn't."
"I think he just has an obligation to come clean. When you clean up the swamp, it's not keeping things secret and applies to yourself," Schumer added.
Now, "it's going to make tax reform much harder" isn't quite "we won't deal unless it happens." But Democrats really have nothing to lose by making the demand as explicit as possible. Reforming the nation's tax system is not a necessity, after all. The federal government won't shut down if it doesn't happen, to put it another way. Like the Republicans "repeal and replace Obamacare" agenda item, it is purely optional. There is no built-in deadline for comprehensive tax return, other than the artificial political deadline Republicans have to pass their party's agenda. And Republicans are going to need Democratic votes to make it happen, so Schumer actually has a lot of leverage to use.
Republicans say they want to accomplish "revenue-neutral" comprehensive tax reform. This is kind of confusing to average Americans, because what it means is that the amount of money the federal government collects in taxes is going to be exactly the same after the reform as it is now. "What's the point, then?" is the usual reaction to a "reform" with a bottom line that winds up exactly where it began.
What Republicans will never openly admit is that their ideas for reform are nothing short of redistributing the tax burden for all Americans. In other words, some will pay more in taxes, and some will pay less. Some of these shifts in the tax burden will be hidden and obscured as much as possible by the politicians, and some will be touted publicly. One of the parts that may be obfuscated is a big shift from taxes businesses pay to taxes individuals pay. Because shifting a large portion of the business tax burden to personal income taxes isn't exactly something Republicans are going to be publicly bragging about.
There are really only three ways to change the tax system: raise taxes, cut taxes, or raise some and cut others. Revenue neutrality means the third of these choices. Republicans are never going to simply raise taxes, after all. And if they just cut taxes, then they'll be adding to the deficit and the debt (because tax cuts never actually "pay for themselves"). What revenue neutrality means is that there are going to be winners and losers in any grand comprehensive tax reform. Who those winners and losers are going to be is still open to negotiation.
This is why a demand to see Trump's taxes is such a potent political issue. Trump's taxes are complicated, so tax reform could impact him in both ways at once -- he could be both a winner and a loser at the same time. Figuring this out, however, is impossible without seeing a few years of his back tax returns.
Republicans, led by Paul Ryan, are going to want to slash taxes for the uppermost brackets, if history is any judge. Cutting taxes for the extremely wealthy is a core part of Ryan's basic political philosophy, after all. But any such cuts are quite likely to give Trump tax breaks worth many millions of dollars. Don't the American people deserve to know this, during the political negotiations?
Chuck Schumer is correct to make this a big political issue before this debate even really gets started. Donald Trump could deceive everyone during the campaign about when he'd be releasing his tax returns (even though he knew full well the answer to that was going to be "never"), but that was when he was still a private citizen. He is now president. That changes things. Schumer should draw this line in the sand, and he should do it before the tax deadline arrives for everyone next week. He should loudly let everyone know that Democrats are not even going to discuss reforming the tax system until each and every American can plainly see how such reforms will affect the personal finances of President Trump. That is a perfectly reasonable thing to demand, and it should be a deal-breaker for Democrats.
-- Chris Weigant
Cross-posted at The Huffington Post
Follow Chris on Twitter: @ChrisWeigant