When Richard Nixon declared, “People have got to know whether or not their president is a crook,” we often forget that he wasn’t talking about Watergate. He was speaking about compliance with tax law. The public had a “right to know,” in this case, what was in his returns and if he had followed the law.
The Supreme Court’s decisions on Thursday in the Trump tax cases vindicated important principles about presidential accountability under the rule of law. A 7-to-2 majority rejected the president’s claim of immunity from compliance with a state criminal subpoena, and the court also turned down his argument that state prosecutors and Congress should have to meet demanding standards to obtain a president’s personal financial information.
But these cases left very much in doubt when the president will have to provide his tax returns, and it is clear that the public will not see them any time soon, if ever.
President Trump has severely damaged the “norm” or practice that presidents have followed since the Carter administration in voluntarily releasing their returns. Some future presidential candidates and presidents may revive the norm, but others may decline, especially if they conclude that there is no real electoral penalty. Those presidents who refuse disclosure now have the ability to contest in court the specific avenues that Congress, or prosecutors, have tried to use in Mr. Trump’s case to obtain the returns.
The American public’s own interest in dependable, timely access to this or any president’s tax filings depends on strong reform legislation from Congress. Legislation, not more and seemingly endless litigation, is the only answer to the gap in transparency about a president’s financial affairs and potential conflicts of interest.
But a president’s disclosure of returns is not just a transparency practice that meets with general public favor and press interest. Releasing returns is vitally important in all presidencies in supplying information not available through a president’s other financial reporting obligation under the Ethics in Government Act. Unlike that act’s reporting by broad categories of income, assets and liabilities, tax returns reveal a lot more and in great detail, like all sources of income, deductions taken, details about foreign business dealings and the existence of offshore accounts.
The ball is in Congress’s court — if not in this session, then in the next. In looking at legal reform of the presidency in the wake of President Trump, Jack Goldsmith, a Harvard professor and assistant attorney general in the George W. Bush administration, and I have come up with a bipartisan plan for the release of presidential tax returns and related information, as well as mechanisms for enforcement.
First, all presidential candidates and presidents (and vice presidents) release their tax returns for each filing year while a candidate or, if elected, for each year in office. The obligation should fall on all presidential candidates who are the nominees of major parties or independent or third-party candidates who qualified for enough state ballots for the general election to garner, in theory, a majority in the Electoral College.
Second, this disclosure requirement should also apply to immediate family members of the president and vice president who serve in the Executive Office of the president, or at departments and agencies. For purposes of conflict of interest policy, the interests of family members should be imputed to the president if he or she assigns them White House or executive branch responsibilities.
Third, while not often discussed in the current tax return controversies, it has been Internal Revenue Policy for decades to conduct a mandatory annual audit of presidential returns. A reform law should mandate that, once the I.R.S. has completed these audits, it release them to the public.
Fourth, the Office of Government Ethics, which administers the Ethics in Government Act financial filing requirements for the executive branch, should have the responsibility of managing tax return disclosure law. It would work with the president and vice president (and candidates subject to the requirement) to ensure that it has received a completed filing for public release and it should be authorized to consult with the I.R.S. for this purpose. The law should also provide that if a president balks, then the Joint Committee on Taxation should be authorized to demand the returns from the Treasury secretary and, if necessary, to sue for enforcement in federal court.
A reform along these lines is consistent with the Constitution. Courts have long upheld personal financial disclosure requirements imposed on public officials. The Supreme Court has noted that presidents’ privacy rights are strongest when asserted “in matters of personal life unrelated to any acts done by them in their official capacity.” The vast powers that president wield, including their administration of the tax laws, leave little doubt about the relevance of their personal tax affairs to their official duties and to the objective of deterring corruption. The disclosure norm that Mr. Trump disregarded spoke powerfully to the public interest in this tax information.
Moreover, this history refutes any suggestion, rooted in a concern for the separation of powers, that tax return disclosure interferes with presidents’ performance of his or her constitutionally assigned functions. It is true that Trump’s refusal to release his personal tax returns incited a battle that has proved costly to his presidency. But the fault for the damage done lies in Mr. Trump’s rejection of the longstanding transparency norm. As the historian Arthur Schlesinger wisely suggested years ago, a “strong presidency” is one conducted “within an equally strong system of accountability.” Mr. Trump has fought this accountability and has not made the presidency stronger in doing so.
Although the Trump tax cases addressed complex constitutional issues, they are defined in the public mind and debate by something simpler: the struggle over access to his tax returns.
And, on that question, only Congress can do by legislative reform what is required to protect an interest in this information that is deeply implicated in but still separate from Congress’s or a prosecutor’s: the interest of the public.
Bob Bauer, a professor of practice and distinguished scholar in residence at New York University School of Law, was a White House counsel in the Obama administration and is a co-author, with Jack Goldsmith, of the forthcoming “After Trump: Reconstructing the Presidency.”
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