Rule of Law

Op-ED: Why the New York Times Got Trump’s Taxes Before Congress

On Sunday, the New York Times published a bombshell report that President Donald Trump paid only $750 in federal income taxes in his first year in office. While this and other details from the president’s taxes were stunning, so too was the source that brought them to light: the New York Times. This is not only because the president has sought to shield his tax returns from the public eye since he first declared his candidacy in 2015, but also because Congress has been seeking these and other financial records for nearly two years. As of this publication, however, none of that subpoenaed financial information has been turned over to Congress.

Why did the New York Times get Trump’s tax returns before Congress did? The answer is that the federal courts have enabled Trump’s efforts to delay the litigation concerning the House’s subpoenas until at least after the 2020 election, despite the time-sensitive nature of these cases. The success of Trump’s efforts to delay these cases—and the judiciary’s acquiescence—offers important lessons to future congresses that wish to engage in legitimate investigations of a president.

When Democrats took control of the House in 2019, they began a host of investigations concerning Trump’s various financial entanglements and failures to disclose his financial holdings and conflicts. For instance, following allegations that Trump may have omitted certain information on federal financial disclosures, and more generally that he may have certain conflicts of interest, the House Oversight Committee subpoenaed various documents from Trump’s accounting firm, Mazars, related to the president’s and his businesses’ finances. Similarly, following public reports of connections among Trump, his financial institutions, and Russian money laundering schemes, the House Financial Services Committee subpoenaed various financial records from two banks—Deutsche Bank and Capital One—to learn more about those connections. The Intelligence Committee subpoenaed similar documents from Deutsche Bank to further the committee’s investigation into foreign interference in our elections, specifically whether any Russian or other foreign actor has financial leverage over and could exploit the president or his family.

Later that spring, the Ways and Means Committee began an investigation into the way that the Internal Revenue Service audits and enforces the federal tax laws against the president. The committee invoked a federal law that requires the secretary of the Treasury to furnish any tax return to the chairman of the Ways and Means Committee upon request. When Secretary Steven Mnuchin refused to provide the president’s tax returns, the committee subpoenaed them and filed suit to enforce that subpoena.

As I have previously argued, all these subpoenas are incredibly time-sensitive. The House is not a continuing body, and the current House exists only until Jan. 3, 2021, at which point its ongoing investigations end, its subpoenas expire, and a new House is sworn in. Furthermore, it takes time to investigate issues like financial disclosures or foreign interference in elections, to craft legislation on those topics, and to pass that legislation through committees and the full House (let alone the Senate). Thus, if the House is to have any hope of actually using the information it obtains from any subpoena to craft legislation, it must get that information relatively early in a congressional term.

Yet now, a year and a half after these investigations started, and even though the House has never been told that it is not entitled to this information, the House still does not have access to any of this financial information. One point bears repeating: no court has said that the House is wrong on the law. Rather, the problem is one of speed. The judiciary has failed to sufficiently expedite these time-sensitive cases in the face of total obstruction by the president. The courts’ failure to appreciate the consequences of delay and ensure that the cases are resolved quickly has given life to the maxim that justice delayed is justice denied.

Take first Trump v. Mazars, the case concerning the subpoenas of the president’s financial records (but not his tax returns themselves) from the Oversight, Finance, and Intelligence committees. Those cases were filed in April 2019, worked their way through the lower courts, and, in December 2019, were consolidated and taken up by the Supreme Court. Yet the court failed to expedite them. It took the court until July 2020, seven months after it initially granted the cases, to issue a decision. Notably, the court can move quickly when it wants to. For instance, back in 1974, the Watergate special prosecutor issued a subpoena for President Richard Nixon’s tape recordings of Oval Office conversations in April 1974. The Supreme Court heard oral argument on July 8, 1974, and issued its decision rejecting Nixon’s arguments on July 24, 1974, less than three months after the subpoena was filed. In comparison, the court took over 14 months to issue a decision in Mazars after the subpoenas were first issued.

That delay is compounded by the fact that the court also failed to issue an opinion that clearly decided one way or the other whether the House was entitled to the records it subpoenaed. Rather, the court held that while Congress has broad powers to “conduct inquiries to obtain the information it needs to legislative effectively,” subpoenas for information pertaining to the president should be subject to a balancing test “that takes account of the separation of powers principles at stake, including both the significant legislative interests of Congress and the unique position of the President.” But rather than decide whether the House’s subpoenas actually meet that new standard, the court remanded to the lower courts to decide that issue.

Unsurprisingly, the proceedings on remand have involved even more delays. For instance, the D.C. Circuit Court of Appeals has requested supplemental briefing regarding what the court should do with the Oversight Committee’s subpoena, and there is still no decision; rather, a D.C. Circuit panel will hear oral argument on Oct. 20, 2020. So too with the 2nd Circuit, which has requested the parties submit briefs explaining to the court how it should comply with the Supreme Court’s decision regarding the Finance and Intelligence subpoenas. The 2nd Circuit still has not issued a decision.

Believe it or not, the Ways and Means Committee’s lawsuit for Trump’s actual tax returns is even further behind than these other cases. As I’ve previously explained, that committee filed suit last July after Trump’s Treasury secretary refused to turn over his tax returns to the committee, despite a federal law stating that the “Secretary shall furnish such committee with any return or return information” (emphasis mine) that the committee requests. But the district court judge, Trevor McFadden, still hasn’t issued a decision in the case 14 months later. Instead, the judge has put the case on hold pending a decision from the D.C. Circuit in another subpoena case concerning the House’s subpoena for former White House counsel Don McGahn’s testimony. And the McGahn case is itself mired in delay, bouncing between a panel of the D.C. Circuit and the en banc (full) court on issues of jurisdiction with no resolution of the merits of that case in sight.

In short, Congress has not received the financial documents, including the president’s tax returns, it subpoenaed over a year ago because of unending delays in the federal courts. And importantly, these delays were not inevitable. They are the result of total obstruction by the Trump administration, and the judiciary abiding Trump’s efforts to slow-walk these cases in an effort to avoid having to comply with these subpoenas before the election.

The lesson from these delays is that future congresses should be far more vigilant to the risk that their subpoenas might get tied up in the courts—and act accordingly. That might mean that future committees move more quickly to file cases to enforce subpoenas when it appears that an administration will refuse to comply, issuing subpoenas in the opening days of a congressional term and filing suit shortly thereafter. In addition, Congress could pass legislation that would expedite cases concerning congressional subpoenas. For instance, a recently proposed bill would send congressional subpoena cases to a three-judge panel to decide them in the first instance, and any appeal would go directly to the Supreme Court for a prompt decision. Such legislation would lessen the chance that a future administration could hold a congressional subpoena hostage by dragging out litigation in the courts.

Without taking concerted steps like these, however, there is a real danger that Congress could forever be prevented from playing its constitutional oversight role if a recalcitrant administration seeks to delay resolution of subpoena litigation in courts. That’s why the courts’ unwillingness to expedite these cases is a travesty for those who wish not only to hold this administration to account, but to ensure Congress maintains robust investigatory powers in the long run.

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