I’m a fan of ProPublica. As a former investigative reporter I admire the valuable work that the non-profit organization produces on a daily basis. Yet, as an attorney who does a great deal of work in asset protection and trusts and estates, as well as a former journalist, I have a problem with ProPublica’s recent “blockbuster” exposing how the wealthiest Americans avoid paying income taxes.
First, there’s the almost breathless coverage. Yes, the wealthiest Americans avoid paying income taxes. But that’s not new. It’s something that has been known for a long time. The second, and more important issue is that the article treats its subjects like villains and speaks of them “gaming” the system. The fact is that the people profiled in the article, from Jeff Bezos to Warren Buffett are not doing anything illegal, and that’s acknowledged by ProPublica. They are using well-known, at least to many, techniques, many of which are actually incorporated into the tax code. As an aside, I believe that anyone who is breaking the law to avoid paying taxes should be appropriately punished.
We all try to minimize paying taxes. That’s why we take deductions. That’s the incentive for many to donate to charity, rightly or wrongly. Articles appear in mainstream publications every December about just how to lessen your tax burden. It’s just that the tax code allows the wealthiest to do it on a larger scale. The problem is with the law as enacted by Congress, and ProPublica’s self-righteous anger should be directed at those who enact the laws rather than at those who follow what the government enables them to do. Do you know anyone who looks for ways to pay more taxes?
What’s more, I believe that it’s an egregious violation of privacy to expose the protected information of those profiled in the article. ProPublica states that it’s in the public interest to publish this information. I fail to see how the public interest outweighs the private, and legal activities, of private individuals.
If I’ve got it right, the headline of ProPublica’s article is essentially something like “Very Rich People are Legally Lowering Their Tax Burdens.” The numbers are indeed stunning, but that’s the sizzle. Those taxpayers are not doing anything that was not envisioned by those who created the law. The actual story is much less sexy. And it’s about tax policy and how, whether and why our elected officials enact it.