America Is in a Sinkhole of Its Own Making
by Richard Cohen
Washington Post Writers Group Columnist
Mario Puzo begins “The Godfather” with a quote from Honore de Balzac: “Behind every great fortune there is a crime.” That certainly seems to be true of Donald Trump’s fortune, sneaked to him by his father, Fred, with accounting sleights of hand designed to fool the IRS and everyone else. That, though, is not the crime. It is this: Much of what the Trumps did was perfectly legal.
The New York Times, like much of the American press naively believing that the truth will free us of Trump, published more than 13,000 words detailing how the Trumps, pere et fils, hid their wealth from tax authorities and passed more than $1 billion from one generation to the next, avoiding about $500 million in taxes. Donald, you will be relieved to know, got more than his fair share. By the age of 3, the precocious child was earning $200,000 a year.
The Trumps’ financial prestidigitations were both ingenious and ordinary and, as the Times said, both “legally dubious” and amounting to “outright fraud.” The latter category consisted of ripping off the middle-class tenants in Fred Trump’s housing projects by fabricating expenses that were then used to justify higher rents. Still, there was probably nothing in the Times’ account that surprised persons of wealth, especially if their game is high-rise real estate, which is just a three-card Monte game with elevator shafts.
As any rich person can tell you, the way to get that way — and stay that way — is to avoid or evade taxes. The Trumps did that with gusto and while President Trump is sui generis, the methods he used are for the most part commonplace. They help explain why America is in a sinkhole of its own making.
As a companion piece to the Times’ article, I suggest the new book by Anand Giridharadas, “Winners Take All: The Elite Charade of Changing the World,” which by only the third and fourth pages will show you that something is awfully wrong. If you grew up with all sorts of chest-thumping statistics on what a wonderful place America was, you now must learn that our vaunted middle class is cratering, that the lower classes have sunk even lower, that income disparity is increasing and that rich American men live 15 years longer than poor American men, “who endure only as long as men in Sudan or Pakistan.” Ah, America — not so exceptional anymore.
The rich now are very rich. The ultra-rich are even more ultra. Yet, all this wealth has had “zero impact on the average pay of 117 million Americans,” writes Giridharadas. Since 1980, the income of the top 1 percent of Americans has more than tripled. In that same period, the income of the bottom 50 percent had remained nearly exactly the same. As for the top 0.001 percent, their income has increased sevenfold. It turns out that a rising tide may not lift all boats but it does turn some into superyachts.
What has caused such an imbalance? Many things, of course, but certainly the reluctance of the government to deal with income disparity is a factor. The new tax law — mislabeled by Republicans as a “reform” – in fact lowered the tax rate for the richest of Americans and gave corporations a windfall without ensuring that they pass on a bit to their workers.
Ever since Ronald Reagan’s ultimately pernicious assertion in his first inaugural address that “government is the problem,” the Republican Party had endeavored to make things worse — and it has succeeded. The middle class it so extolls has suffered for the GOP’s electoral success. The vaunted American dream is now the sheerest of fantasies. The poor stay poor — but company is tumbling their way. The floor under the middle class is buckling.
One thing about Donald Trump is that he is occasionally honest about his dishonesty. During the presidential campaign, he essentially boasted that only fools pay their fair share of taxes. He made tax evasion virtuous, which is another way of saying he feels he owes nothing to nobody. It is, as Giridharadas writes, the way many rich people feel. Their call to spread the wealth is limited to vainglorious family foundations.
For some on the left, the remedy is now socialism. Yet, outside of the lecture hall, it has worked nowhere. The real remedy would be a political uprising in which the trends and the current situation are denounced as, truly, un-American. Continued silence is a crime not even Balzac could envision.
Richard Cohen’s email address is [email protected](c) 2018, Washington Post Writers Group