RUSH: Now, Trump’s taxes. Isn’t it amazing, folks, it was just yesterday, just yesterday, right here on this program, I was talking about how strange it is that nobody in the IRS had leaked Trump’s taxes, after all of this time, knowing full well that the IRS is a government agency and that means there’s got to be a lot of career leftists in there, which means there have to be a bunch of people in the IRS that despise Trump.
The Democrat Party has been going bonkers trying to get hold of Trump’s tax returns because they think… You know what they still think? There was some locoweed on the Judiciary Committee today that made the point yet again, or tried to, lying through his teeth. Steve Cohen. This is the guy that had the Kentucky Fried Chicken last week when Barr refused to show up, trying to make Barr look like a chicken, like a coward. He’s actually trying to say that the tax return story New York Times (sputtering) “pretty much… pretty much gives us an indication that Trump might have been kept afloat by the Russians.
“This guy lost over a billion dollars. He should be in jail. The Russians… The Russians kept Trump afloat.” That’s what they want to find out. They’ve wanted to know this in Trump’s tax returns ever since the campaign of 2016. I was marveling yesterday that it hadn’t leaked. Just yesterday, I was marveling. We’re talking about it. Well, the New York Times must have heard us because they put out a supposed blockbuster report that claimed data they have been given on Trump’s taxes show that Trump took nearly a billion-dollar tax loss in the early nineties, which may have allowed him to go without paying income tax for 10 years.
How many of you upon hearing that said, “Wait a minute. I knew this. I’ve heard this.” You have heard this because this isn’t new. This is an old story recycled. I’ve got the audio sound bites from my program, from the archives, to demonstrate this, which we will do as the program unfolds. The New York Times reported practically the same thing back on October 2, 2016. Only back then, the New York Times claimed that Trump might not have paid any taxes for more than 18 years. It’s funny how nobody seems to remember this.
This is an old story being recycled, that Trump didn’t pay any taxes ’cause he took a billion-dollar loss and was able to write off that loss so he didn’t owe any taxes over all those years. That story has been out there. It’s been reported before. So this is the recycling of a story that claims to be new because there is a linkage (they say now) to Trump’s actual returns. Although the Times have been very, very careful to point out (impression), “We haven’t seen the returns.
“That would be illegal! We haven’t seen the returns. We have seen, uh, written transcripts of Trump’s returns from people who are legally allowed to have them.” Well, who would that be? Trump’s tax preparers, people at the IRS, what have you. Now, that bombshell back in 2016, October 2nd, was supposed to be the October Surprise that guaranteed Trump would lose to Hillary, that Trump hadn’t paid his taxes. (impression) “He had taken a billion-dollar loss. He was a rotten businessman! He might have been cheating the government, cheating the IRS.
“Who writes off a billion-dollars? No wonder Trump doesn’t want to release his returns,” everybody said. Here’s the bottom line about this. Because of the Democrat Party’s evolution, and because of its anti-capitalist beliefs, there isn’t, I don’t believe… I don’t believe there’s a single member of the media, and I don’t believe there is a single member of the Democrat Party capable of understanding the way a real estate magnate like Donald Trump organizes his affairs. I think it’s so far above their level of comprehension.
They don’t have any experience in it. They hate capitalism. These are Big Government people. They have not educated themselves on the way the private sector works, how private sector organizations/companies organize themselves, how they deal with tax law. They just hate them. They just hate capitalism. They hate big corporations, and they come up with all these cliches to describe them. There isn’t anybody independently capable of looking…
Even if they had Trump’s tax returns, I don’t think there is a single (even in the business community) journalist capable of understanding Trump’s tax returns and telling anybody what they mean. There isn’t anybody capable of understanding how the Trump Organization is and was organized and how it operated. There isn’t anybody that understands how real estate operated with tax law back in the eighties and early nineties.
Real estate tax law underwent significant changes in the 1986 tax law. I’m just telling you, the arrogance and contempt for capitalism among people on the left, I guarantee you, has prevented them from having the slightest idea. Not just about Trump, but any other megacorporation in real estate or whatever. How they actually operate and how reporting losses is an objective for some.
How limiting what you pay in taxes is an objective for some, and how maybe this tax return actually shows how brilliant Trump was at running his business and keeping it afloat, given these circumstances. In fact, the New York Times… I’m sorry! The New York Times did that story back in ’95 (I’ve got it right here) about what a brilliant operator Donald Trump is. It’s what led to the book The Art of the Deal. That’s right! The New York Times, in 1995, had a big kiss-ass article on what a brilliant operator Donald Trump is.
RUSH: I want to go back to my own website, October 3rd, 2016. That’s when the New York Times and Trump’s taxes story first hit. And the first version of the story was that Trump had reported losses of almost a billion dollars back in the first version of the story. It was 900 some odd million dollars that Trump had lost and had taken a write-off on and avoided paying any federal income tax.
He was asked about this in one of his debates with Hillary Clinton. In fact, it was Anderson Cooper. (paraphrasing) “Did you actually take a loss totaling almost a billion dollars in taxes back in the nineties and not pay any federal –”
“Damn right I did. And I used some of the laws that Mrs. Clinton wrote to do it! It’s called depreciation! It’s called tax shelters. Damn right I did. I’m probably know the U.S. tax code more than anybody’s ever run for president. I love depreciation.” And he just turned around and he rammed it down their throats.
Now, the New York Times story — and I remember, I was in New York at the time, and I remember this like it was yesterday. Trump was reported by some of the tabloids to be on his financial deathbed. This was it. The Taj Mahal and all the casino operations in Atlantic City were gonna come crashing down. Trump’s airline, he had the shuttle, the Trump shuttle, New York to Washington, New York to Boston, it was losing money left and right.
Trump was on the verge of being blown away financially. And then, miraculously, Trump’s businesses were infused with new money. And the news stories turned around, Trump came back from the brink, Trump this, Trump the original too big to fail. And you know what the stories were? How brilliant Trump was, that he had borrowed so much from so many banks that they could not afford to foreclose on him because they would go down the tubes.
The New York Times story was how brilliant Trump was at managing his debt and at making other people, other lenders culpable in it, that he literally had become too big to fail, that a number of lending institutions and banks could not afford to foreclose on him because it would be the end of them as well.
What I said back in 2016, October 3rd: “I need to add one thing, even though it isn’t gonna matter to anybody, but I have to let you know anyway. Back in 1995 the New York Times called Donald Trump ‘the comeback kid,’ and it’s one of the reasons why he wrote The Art of the Comeback. I’m not making it up. The New York Times, which has broken the law to publish three pages of his 1995 tax return, back in ’95 called Trump ‘the comeback kid.’
“Let me read you a portion of the New York Times article from 1995. Quote, ‘After the collapse of the real estate market of the 1980’s, Mr. Trump’s company was left holding some $8.8 billion in debt, causing his personal net worth to drop to a low of about $1 billion in the red by 1991.’ This is the famous tax change in 1986 that took away all deductions, took the top marginal rate essentially from 70% down to 28. And, if you remember, a lot of real estate people got hammered,” in the 1986 tax deal because the deductibility went away with the reduction of the rates, depreciation was disallowed over more and more. The condo market especially.
“Rental real estate was just devastated by it. Trump was one of them. ‘After the collapse of the real estate market of the 1980’s –‘” this is the New York Times back in ’95, “’– Mr. Trump’s company was left holding some $8.8 billion in debt, causing his personal net worth to drop to a low of about $1 billion in the red by 1991.’ One billion in the red by 1991, and he has recovered to be what he is now. That’s a pretty significant comeback, and the Times was writing about it in 1995.”
One of the banks that forwarded Trump a bunch of money, lent him a bunch of money to begin his comeback was Deutsche Bank. And what Deutsche Bank did — and this is where these numskulls on the left take a little grain of information and blow it up into something that they don’t even understand — Deutsche Bank lent Trump an incredible amount of money, but they laid off some of the risk. Meaning, of the money Trump owed them, they sold some of that to other banks.
Just like you get a mortgage with a bank and one day you get a notice your mortgage has been sold to another bank. Lending institutions change their level of risk all the time. And they lay off elements of risk. So Deutsche Bank sent Trump a lot of money, but they didn’t want to become totally dependent on Trump paying it back, so they sold some of Trump’s debt to a consortium of banks that did some business in Russia.
And that’s the link to Trump owes Russia. Trump doesn’t owe Russia anything. It was Deutsche Bank that lent him the money, it was Deutsche Bank that laid off some of their loans to Trump to a consortium of Russian banks. It’s insignificant in terms of the amount. But that one little shred of information is what a network like MSNBC or a bunch of know-nothings over at CNN will take, “See? See? Trump is totally, totally dependent on the Russians.” It was so far ago, it was irrelevant.
Trump tweeted about this: “Real estate developers in the 1980s & 1990s, more than 30 years ago, were entitled to massive write offs and depreciation which would, if one was actively building, show losses and tax losses in almost all cases. Much was non monetary,” meaning it was paper. “Sometimes considered ‘tax shelter,’” real estate building, condo building, all these things considered tax shelters. And this is before the ’86 tax law because of depreciation allowances and because of the write-offs that were permitted.
Remember, the government writes tax law for a host of reasons, and one of the reasons is social architecture. One of the reasons is business architecture. So if a Congress or if a president and Congress at any moment in history decide that they want to rebirth, say, the real estate industry, well, they will go in and they will rewrite the tax law to be advantageous to people who start building real estate.
If they want a bunch of condominiums built for who knows whatever reasons — maybe their donors build condos. You know how Washington works. But if Congress and the president get together and decide that the real estate business needs a shot in the arm then they’ll write tax law favorable to people that invest in real estate or build commercial real estate or private condominiums and so forth.
And that’s what was the law of the land throughout the eighties. And there were gigantic depreciation schedules that were taken advantage of. There were tax shelters. It was a way to promote investment. It’s just like the home mortgage interest deduction. Every now and then they decide, somebody poses the idea of getting rid of it.
And guess who steps in to stop it? The real estate industry and the home builders bunch ’cause they know without the mortgage interest deduction, nobody’s gonna buy houses. So mortgage interest deduction was introduced originally as a way to goose home building, to promote the American dream.
Well, when Trump was engaged in real estate and all these things he was doing, tax law was extremely favorable to real estate investors, real estate prospectors — people that would build commercial real estate, condominiums and so forth. All of the tax advantages for doing so was what Trump was taking advantage of. Those have since been eliminated and changed, and the economy has been goosed in different areas by succeeding tax law since then, and Trump was able to invest enough that allowed him to show paper losses over a billion dollars.
Meaning he did not have to pay income tax because he was reporting losses, not gains — and depreciating his holdings at a rapid rate was what was permitted as well. But he had taken out a lot of loans in order to make all of this happen. The loans were so extensive that the banks could not foreclose on him, and it was that feature that caused the New York Times to write this gigantic article about the “Comeback Kid,” because if you were in New York at the time, you remember Trump was proclaimed to be on his financial deathbed for two, three years running.
And then all of a sudden, he’s back and he’s whole and he’s gigantic again. The story was the banks had to keep lending because they couldn’t afford for Trump to go bankrupt. They couldn’t afford for Trump to lose everything, because then they would go south with him — and he was credited for being brilliant enough at the outset in arranging his original loans that exposed his lenders to the same calamities he would be exposed to. That’s what got him this article of praise by the New York Times.
It’s simply a rehashing of that era now that the New York Times is engaging in and trying to rewrite what happened into the fact that Trump was a business buffoon, didn’t know what he was doing, almost went bankrupt, didn’t pay his taxes. But this story is old. They tried this back in 2016. There’s nothing new. The real story here on Trump and his taxes is, “Who the hell at the IRS gave up even more information in this story than they had three years ago?” Who is it? The leaker and the illegality, that’s the real story in the Trump New York Times story, not the details of his finances, because there’s nothing new in that.