April 19, 2004

Teresa's tax returns

By Thomas Lifson

John Kerry is stonewalling on the issue of releasing his wife's tax returns. Probably, he has no choice in the matter. They aren't his to release. We can't be certain that he has even seen them himself.

 

His wife, on whose fortune rests his lavish lifestyle, has never appeared to be exactly enthusiastic about his run for the Presidency. Although she dutifully attends his campaign events, she often appears bored or distracted, when she isn't looking peeved. Not for her the adoring gaze of a candidate's wife, enraptured by the glamour, and thrilled that others cheer for her man. Now that the press has taken note of her dour behavior, campaign staffers are evidently coaching her to at least clap along with the crowds, which she dutifully performs, along with the occasional slightly sour smile.

 

The fortune she inherited from her late Republican husband has accustomed her to the privileges accorded to the ultra—rich. Not just the Gulfstream V, the lavish houses, the designer clothes, and the other baubles attending a nine—figure net worth. The greatest privilege of all is the ability to have what you want, where and when you want it, with no backtalk. Most of the wealthy (with a few obvious exceptions like Donald Trump and Paris Hilton) like their privacy. Privacy means other people not criticizing or judging your decisions.

 

But now that her second politician husband is playing in the biggest league of all, privacy is becoming the rarest and most precious commodity of all. It was one thing to be married to a Senator. Invitations to the best parties, access to the highest social circles, and the perk of State Department officials to ease your way traveling or staying overseas. Teresa, a confirmed internationalist, fluent, we are told, in several European languages, loves to travel overseas.

 

But now, everything is subject to scrutiny, because the fate of the world rests ont he shoulders of a President. Until her husband adopted the campaign ploy of condemning 'outsourcing,' Teresa owned a beautiful villa in northern Italy—region>. But it was quietly sold just a few weeks ago. The charms of Italian cuisine, Alpine scenery, and the particular gusto for life at which Italians excel, are no longer a fixed part of Teresa's itinerary.You can begin to appreciate how this whole escalation to a Presidential campaign is getting to be rather a bother for her.

 

Demands for the release of Teresa's tax returns are not going to go away, though. John Kerry has a huge personal stake in her financial wherewithal, so it cannot be maintained with a straight face that her financial welfare and taxes are irrelevant to his performance as a candidate, or as a potential President. Without his ability to borrow against the value of the Beacon Hill townhouse, on whose deed his name appears along with hers, his campaign would have collapsed before Howard Dean's meltdown revived his fortunes. It was only his real estate wealth which kept him alive in the campaign, to pick up the pieces when Bush—haters realized that Dean was not viable as Presidential timber, and so cast their eyes elsewhere for a white knight to embrace. Had Kerry, unable to raise money from actual donors, already quit the race, he would not be the presumptive nominee today.

 

Kerry has no good options, in the face of sustained demands for disclosure of his wife's tax returns. If he says that she is in charge of her financial affairs, and he can't get her to change her mind, he looks rather weak. Despite decades of feminism, a rather substantial percentage of the voting public might decide that a man who can't get his wife to reveal her financial circumstances cannot be trusted to take on al Qaeda.

 

If he maintains that it is simply none of his or the public's business, he opens up his lifestyle for inspection of Teresa's money at work. It is no secret that he spends far more money than a Senator's upper—middle management salary permits. He would look like shallow gigolo, enjoying the favors of a wealthy woman, but unable to ask too many questions or enforce his will in any spehere that matters, not to put too fine a point on it.

 

But if he is able to persuade Teresa to make her returns public, then many, many embarrassing points are all but certain to become matters of public contention. Unless Teresa's tax advisors are cretins, she has adopted many of the ploys the ultra—rich use to keep their tax payments well below the near—confiscatory levels faced by prosperous small business owners. Tax free municipal bonds. Sophisticated shelters which report little income while building equity, taxed at long term capital gains rates, but only when the assets are sold. Expensively—constructed labyrinths of trusts, beneficial trusts, royalty trusts, irrevocable trusts, and other fictive legal entities, serving no purpose other than to shift the tax burden to the little guys, who lack the wherewithal and scale to behave similarly.

 

Kind of embarrassing to be the beneficiary of all that expensive lawyering, when you've made it a cornerstone of your campaign to ensure that the rich 'pay their fair share.'

 

There are no good options for candidate Kerry. His friends in the traditional media have no interest in keeping alive the question of Teresa's taxes. But the days of the liberal media monopoly are over. Pointed questions about John Kerry's dependence on his wife's fortune, and the amount of taxes paid by the money which benefits him so handsomely, are in season, and will remain so until November.