Do I have this straight: the president as a private citizen sued a department of his own government for billions of dollars, then dropped the suit as the Justice Department announced a fund that gives (essentially) him control of $1.8 billion to disburse at his whim, with no oversight, and the government agreed never to audit any of his prior income tax returns? That doesn’t seem right…how did we get here?
As a candidate for president, who later was convicted of multiple dozens of felonies, he was asked to release his income tax returns as is customary in these elections, but said he was being audited and would release them once the audit(s) were complete. (There is no law that prohibits the release of returns that are under audit, although some lawyers would urge their client not to while the matter is ongoing; the public release of tax returns is a nod to openness and to prove that the candidate will have no secret conflict of interest once in office.)
But then this candidate never did release his tax returns, and never gave any further reason why he chose not to do so. (Some returns were released later by a House committee, though.)
The candidate (and we all know who I’m talking about) won the 2016 election, and later some of his federal tax returns were published after an investigation by the New York Times. Those returns show the man who claims enormous wealth twice paid only $750 in federal income tax. This same man had proudly boasted during the campaign that not paying taxes was an indication of his intelligence, rather than his greed or his unwillingness to pay his fair share of the operation of our nation’s government.
After the twice-impeached former president won re-election in 2024, which itself forced the termination of several other criminal cases against him due to a custom not to prosecute sitting presidents, he filed a $10 billion lawsuit – yes, TEN BILLION DOLLARS – against the Internal Revenue Service – yes, an arm of the same Executive Branch that he himself was now (again) the leader of – to recover for the alleged damages done to him by the Service’s alleged laxity in allowing his tax returns to have been published against his wishes. That’s right: the president admits – he swears in the suit– that letting the public see his tax returns “caused Plaintiffs reputational and financial harm, public embarrassment, unfairly tarnished their business reputations, portrayed them in a false light, and negatively affected President Trump, and the other Plaintiffs’ public standing.” Curious claim for such an outstanding and successful businessman, right, but there it is.
As the judge assigned to this case started to ask questions that indicated the suit may not have smooth sailing – that, for example, there didn’t seem to be any real conflict here if the president is suing his own government and he controls the lawyers on both sides – the president announced he has withdrawn the lawsuit. As is his right.
But THEN, the president’s Justice Department – which has in this second TFG Administration brought shame upon itself and the nation for openly seeking revenge (under the cloak of “justice”) against the boss’ political enemies and those of the boss’ supporters – announced the creation of a giant (insert your own descriptive adjective here) fund controlled by the president’s supplicants that can be distributed by them/him, with no oversight from Congress or the courts, to those who claim damages from being victimized by a previous government of another party which had attempted (ineptly and too slowly, it turned out) to investigate allegations of lawbreaking by TFG himself. And by his minions.
Mr. Trump’s decision to drop his suit against the I.R.S. appeared to be intended to strip Judge Kathleen M. Williams, who had been overseeing the I.R.S. case in the Southern District of Florida, of her appointed role in approving a formal settlement agreement. By dismissing the case in its entirety, Mr. Trump was able to reach an agreement with his own appointees [emphasis added] without risking the rebuke of an impartial and independent arbiter. Judge Williams, tacitly acknowledging her hands were tied, accepted the president’s dismissal of the suit and formally closed the case by the end of the day.
(snip)
Money for the fund will come from a special, unlimited account available to the Justice Department for settling lawsuits. That pool of money gives the department the authority to make monetary settlements without needing approval from Congress. A group of five people, selected by Mr. [acting attorney general Todd] Blanche, will oversee the operations of the fund, though Mr. Trump can fire its members at will. It will stop processing claims on Dec. 15, 2028, weeks before Mr. Trump leaves office.
Creation of the fund, which could be used to compensate Trump supporters who ransacked the Capitol on Jan. 6, 2021, is sure to please a president who has demanded not only retribution but recompense. But it could create major political problems for congressional Republicans already dealing with the political ballast of his unpopularity — and who will now be forced to say if they support or oppose allocating taxpayer cash to his allies at a time when many Americans are struggling economically.
AND, the agreement attempts to protect itself by claiming up front that no arm of Congress or the courts, or anyone else on this planet or any other, in perpetuity, has any legal right to try to do anything at all about it. (We’ll see about that: two police officers who were in the Capitol on January 6 have already filed suit to block creation of the fund. I bet there will be others.)
AND MORE THAN THAT, this agreement also bars the IRS from auditing TFG’s previous tax returns, or those of his sons, or their companies. For ever. (A get out of jail free card? An after-the-fact non-disclosure agreement, shielding any evidence of any prior tax evasion?)
Is that about it? What should we think about all this?
“This is one of the single most corrupt acts in American history,” said Donald K. Sherman, president of Citizens for Responsibility and Ethics in Washington, a nonprofit legal watchdog group that has been critical of the administration.
But others disagree, including some of the nearly 1600 people indicted for their role in the January 6 attack who have already been pardoned or had their convictions dismissed. By TFG. They could be getting a payout from the government they attacked.
Some felt that the fund validated their self-image as victims of the government. Others felt elated — albeit somewhat stunned — at the prospect of a payout. And not a few felt a bit confused at how the process of filing claims and receiving checks could play out.
“So many questions,” said Enrique Tarrio, the leader of the far-right Proud Boys who was sentenced to 22 years on a seditious conspiracy conviction arising from the riot. “But it’s a good direction.”
From the “most corrupt ever” reactions, to the folks annoyed by the nuisance of filling out the application, a more pertinent question (or impertinent, if you are TFG) would be, is this legal? The answer is, I think: we will see.
The whole enterprise was a jarring shock to the conventional understanding of the constitutional system, raising what legal experts said were profound questions about presidential power. If the arrangement is allowed to stand, they said, Mr. Trump will have managed simultaneously to thwart Congress’s power of the purse and the ability of the courts to police the separation of powers.
(snip)
Professor [Samuel] Bagenstos, who served as the general counsel of the Office of Management and Budget and of the Department of Health and Human Services in the Biden administration, wrote in January about the danger posed by the Judgment Fund.
“An administration that wished to spend money on projects or beneficiaries not authorized by Congress,” he wrote, “could simply encourage its desired recipient to bring a lawsuit against the United States and then settle that lawsuit (no matter how frivolous) by making a payment from the Judgment Fund.”
While Congress has ceded power to the executive branch, it could also reclaim it. Indeed, Senator John Thune, Republican of South Dakota and the majority leader, said on Tuesday that he expected lawmakers to scrutinize how the president’s lawsuit had been ended.
(snip)
A Justice Department news release on Monday said that the “plaintiffs” — that is, Mr. Trump and his family — “will receive a formal apology but no monetary payment or damages of any kind,” a provision the White House used to defend the fund. Still, the opportunity to help direct payments approaching $2 billion to allies has value.
So does the elimination of the threat of an audit. In 2024, The New York Times reported that Mr. Trump could face a tax liability of more than $100 million.
The deal was open to question for other reasons.
The I.R.S. had plenty of defenses to Mr. Trump’s suit. For instance, it might well have been barred by the statute of limitations.
Nor was it clear that the agency was liable for the acts of Charles Littlejohn, a former I.R.S. contractor who pleaded guilty to leaking Mr. Trump’s tax information and whose actions Mr. Trump had cited as a reason he had been wronged by the government.
The sum Mr. Trump sought was also roughly equal to the agency’s annual budget.
And the suit was palpably collusive, ordinarily a reason for a judge to toss a case.
Tuesday’s addendum to the settlement, the codicil purporting to immunize Mr. Trump and his family, raised its own legal questions.
(snip)
Even under the Supreme Court’s 2024 decision conferring broad immunity on Mr. Trump for his official acts, purely private conduct, as the filing of a tax return would seem to be, is fair game for prosecution after a president becomes a private citizen. It is not clear whether the addendum could block a future administration from pursuing such a claim.
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