As the longtime frontrunner for the Republican presidential nomination, Mitt Romney has faced withering attacks from rivals seeking to upset him.
Some have been unfair, like Texas Gov. Rick Perry's charge that Romney practiced "vulture capitalism" during his time at Bain Capital. Former House Speaker Newt Gingrich described Romney's old firm as "rich people figuring out clever legal ways to loot a company."
Carcasses don't voluntarily sign contracts with vultures. These ailing companies sought Bain's help because of prior mismanagement, so it's unfair to blame Romney and his colleagues for the subsequent layoffs.
But the controversy over Mitt Romney's taxes last week shed light on a more-shameful practice, albeit one for which Romney isn't to blame. Regulatory filings from Bain Capital show that Romney's assets include a stake in BCIP Trust Associates III, a partnership registered in the tax-free Cayman Islands. According to ABC News, Bain has at least 138 such funds registered in the Caymans.
The BCIP fund is registered under an address in the Cayman capital, George Town, at the site of a building owned by the international law firm Walkers. Many corporations, such as Coca-Cola, Intel and Oracle, have addresses there for tax purposes.
Another Cayman law firm, Maples and Calder, owns a nearby five-story office building that houses, at least on paper, almost 19,000 companies. "Either this is the largest building in the world," said President Barack Obama in a 2009 speech, "or the largest tax scam in the world."
The debate over Romney's taxes is about fairness: his offshore tax-avoidance strategies are beyond the reach of most ordinary Americans. The tax return he released last week revealed that Romney also pays a much lower income tax rate (13.9 percent) than his less-wealthy rival Gingrich (roughly 32 percent) because most of Romney's income is from investments, not wages.
But as billionaire investor Warren Buffett said last week, Congress is ultimately to blame for the loopholes Romney uses.
"He's not going to pay more than the law requires, and I don't fault him for that in the least," Buffett said. "But I do fault a law that allows him and me earning enormous sums to pay overall federal taxes at a rate that's about half what the average person in my office pays."
Romney's campaign has noted that his tax-avoidance strategies are perfectly legal, which is true. A 2008 Government Accounting Office report concluded that Maple and Calder hasn't broken the law.
"It's not really getting away with something," said offshore investment lawyer Bart Mallon last week. "It's just working within the tax laws as they're currently written."
Opinion
Mitt's not at fault for loopholes in tax code
- Opinion
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In Memoriam
This message appears each Memorial Day weekend in The Daily Star.
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Letters to the Editor: May 26, 2012
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Letters to the Editor: May 25, 2012
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Facebook’s fizzle was no surprise
Facebook’s IPO last week was supposed to be a moment of triumph for the social network, but the event quickly devolved into an ugly tale of duplicity, hubris and greed, as the stock lost 18 percent of its value in the first two days of trading.
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Letters to the Editor: May 24, 2012
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Heegan must show vision for Chamber
In selecting Barbara Ann Heegan as its executive director last week, the Otsego County Chamber would seem to have chosen a safe rather than a bold path for its immediate future.
- Wednesday, May 23, 2012
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Letters to the Editor: May 23, 2012
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Can't have a third party without a candidate
What if they gave a party ... and nobody came?
- Tuesday, May 22, 2012
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Cheers
To Bike to Work Day, Cooperstown Quiz Team, Arts Field Day, the SUNY Delhi Centennial.
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Letters to the Editor: May 22, 2012
- Monday, May 21, 2012
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Letters to the Editor: May 21, 2012
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The world does move
To look at a newspaper from 1912, 1937, 1962 or 1987, it can seem as though positively everything has changed.
- Saturday, May 19, 2012
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Letters to the Editor: May 19, 2012
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Graduates, take acquired skills, set sail on job voyage
This weekend, many colleges and universities -- including SUNY Delhi and SUNY Oneonta -- will bestow degrees of various levels and types upon their students.
- Friday, May 18, 2012
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Letters to the Editor: May 18, 2012
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'Whale' failure shows how little has changed
One positive development resulting from JPMorgan's recent $2 billion trading blunder is increased scrutiny of the regulations put in place since 2008 to prevent a repeat of that year's financial collapse.
- Thursday, May 17, 2012
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Taxes spoke louder than sentiment in voting
It has become a virtually immutable fact of modern-day industry and politics. Given the choice between financial interest and sentiment, money always wins.
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Letters to the Editor: May 17, 2012
- Wednesday, May 16, 2012
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Letters to the Editor: May 16, 2012
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Gas companies need to play nice with residents
"You need to assure me that you are going to talk to the towns." This was Rep. Chris Gibson's plea to the gas companies that are seeking to lay natural gas pipelines through the local area.
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In Memoriam
