A wealth manager for the 1% explains why her clients think Donald Trump is smart for not paying his taxes
"For [the 1%], national boundaries and laws are all optional. Taxes are optional. All types of law are essentially optional at that level of wealth," Brooke Harrington, a wealth manager for the ultra rich and author of "Capital Without Borders: Wealth Managers and the One Percent," told Shankar Vedantam on a recent episode of NPR's Hidden Brain podcast.
That's why it was unsurprising for Harrington to hear that several of her own clients, as well as her fellow wealth managers and their clients, agree that Donald Trump made a smart decision in not paying his taxes, referring to the fact that the Republican presidential nominee may have avoided paying federal taxes for 18 years, according to tax records obtained by the New York Times.
Trump later said during a debate that he used loopholes in the tax system to avoid paying federal income taxes. And he suggested during a previous debate that not paying taxes made him "smart."
"When I heard Donald Trump say that not paying taxes made him smart and that if he had paid his taxes they would have been wasted anyway, I was like, 'Yep, he's the voice of a lot of wealthy people around the world,'" Harrington told NPR.
Harrington explained that this stems from a common belief held among her elite clients and their wealth managers that they are "doing the world a favor as wealth creators" and that paying taxes is simply thievery by the government.
"[They believe] that their initiatives should be protected against the government and what they regard as theft by taxation by incompetent governments that would just waste any money they collected anyways," Harrington said.
She goes on (emphasis ours):
It's important to note that while there are clever, legal ways the rich manage to save on their taxes, the morality of Trump's tax avoidance remains under speculation. Business Insider's Josh Barro argues that it's not normal.
But in the world of the ultra wealthy that Harrington has played witness to where anything can - and will - happen, Trump's views aren't out of place.