GOV. HENRY McMaster clearly hoped that letting reporters peek at his income tax returns would quell questions about his relationship with campaign consultant Richard Quinn. As in: Did he receive any payments from Mr. Quinn, as an indictment charges that his friend and fellow Quinn client Sen. John Courson did?
Of course it’s difficult to prove a negative, and income tax returns couldn’t do that anyway: Who would report payments that were illegal? But the returns do show us that Mr. McMaster did not accept any payments that he believed to be illegal — which is somewhat relevant since Mr. Courson has told friends he considered his payments legal.
And that gives me some comfort, because it’s so difficult to believe that anyone as familiar with criminal law enforcement as our crusading U.S. attorney turned state attorney general turned governor would mess around with the IRS. There is, after all, a huge difference between violating federal income tax law and, say, not reporting income on a state campaign-disclosure report.
More importantly — since this is just speculation — opening his tax returns to public inspection also suggests that Mr. McMaster understands that the new rule in South Carolina is that governors, and gubernatorial candidates, let the public look at those returns.
That’s important because nothing in state law requires public officials to do that, and the annual income-disclosure reports they are required to file contain far less information about potential conflicts of interest, let alone financial priorities. (Not so encouraging: Mr. McMaster’s initial refusal to report gifts he received as lieutenant governor, claiming he didn’t have to since he’s now in a different office. Fortunately, he backed down when questioned.)
Although all but one of the presidential nominees and presidents in more than a half century have released their income tax returns to the public, it’s been just seven years since we got our first look at our gubernatorial candidates’ returns. That came thanks, indirectly, to then-Rep. Nikki Haley, who had so wrapped herself in her transparency mantra that she had no choice but to release her own returns when challenger Gresham Barrett released his during their 2010 Republican primary runoff. Once Ms. Haley became governor, she made a habit of making her tax returns public.
And now Mr. McMaster has allowed reporters to review far more tax returns than Ms. Haley ever did — 16 years worth, covering all of his time in office and then some.
Unfortunately, like both Mr. Barrett and Ms. Haley and unlike the presidential candidates, the key word here is “review.” Mr. McMaster did not let reporters take copies of his tax returns with them; spokesman Brian Symmes said the governor simply decided to follow Ms. Haley’s precedent.
Reporters were given access to about 300 pages of tax documents starting at 2 p.m.; the staff said they could stay as long as they wanted, but they had deadlines to meet, so they cleared out by 7. As Charleston’s Post & Courier noted, the limited access made it “nearly impossible for the governor's financial history to be thoroughly vetted.”
The State’s Jamie Self told me that at some point reporters had to stop trying to write down details, focus in on a certain type of information, skim everything else and hope they didn’t miss anything important, because they didn’t have time to thoroughly review it all.
The result is that a lot of valuable information never left the room. For instance, more details about charitable giving might not be particularly important to the life of the republic but do tell us about our governors’ values. Likewise, I’m sure some Columbia homeowners would like all the detail they can get about the McMasters’ rental properties, which they believe aren’t kept up sufficiently.
But the most important thing we can learn from tax returns is where an official’s income comes from, because that shows us potential conflicts of interest. And having copies allows reporters — rarely experts on complex tax returns — to get accountants to review them. The State’s John O’Connor got around the problem in 2010 by taking blank tax forms with him to the viewing and writing down all the information on Ms. Haley’s returns. But Ms. Haley released only three years worth of returns, compared to Mr. McMaster’s 16 years, and her returns were much less complicated.
If your only goal is to demonstrate that there is no income from a particular source, it probably seems logical to a politician to limit the viewing. But Mr. Symmes told me that the governor “thought it was an important way to show that he’s committed to an open and transparent government.” And by that standard, it comes up short.
If Mr. McMaster wants credit for practicing the openness he preaches — and he has made a career of preaching and usually practicing extensive disclosure — he needs to raise the bar: He needs to make those tax returns available in a way that doesn’t force reporters to pick and choose which parts to ignore.
Ms. Scoppe writes editorials and columns for The State. Reach her at firstname.lastname@example.org or (803) 771-8571 or follow her on Twitter or like her on Facebook @CindiScoppe.