Republican presidential challenger Wilalrd Mitt Romney shed dozens of stocks and holdings in various foreign companies in the last 10 months, beefing up his cash reserves while maintaining an overall fortune as high as $250 million, according to personal financial disclosures he filed Friday, June 2, 2012.
The disclosure — required of presidential candidates — showed that the GOP nominee's net worth has not changed greatly since September 2011's financial disclosure, when he reported his assets were worth between $190 million and $250million.
President Obama, meanwhile, reported in May 2012 that his assets are between $2.6 million and $8.3 million.
Most of the money held by Willard and his wife, Ann, is locked up in investments administered through two blind trusts established in 2003 after he was elected governor of Massachusetts. The trusts are stocked with debt securities, hedge fund investments and other complicated financial instruments — some of them based overseas — that date from his tenure running Bain Capital. Those Bain funds produced income between $720,000 and $6.3 million.
Andrea Saul, a Romney campaign spokeswoman said.
"They do not control the investment of these assets, which are under the control and overall management of a trustee."
One of the biggest shifts in Romney's portfolio in the last year was his divestment of dozens of stocks, boosting his cash reserves to at least $6.4 million.
Two separate investment fund managers decided independent of Romney to shed nearly all of his stocks, the filing states. Among those sold were his holdings in Coca-Cola, Procter & Gamble and Apple. Romney held on to three U.S. stocks: at least $250,000 worth of shares in Ford Motor Co., at least $1,000 in
Marriott Vacations Worldwide and at least $100,000 in Marriott International, where he served as a director from January 2009 to January 2011.
He dumped his extensive foreign stock holdings, which included Wal-Mart de Mexico — now the subject of U.S. inquiries into bribery allegations — as well as several publicly traded firms in China. Romney has been a harsh critic of China's trade policies.
In several of his fund holdings, Romney provided no information on the underlying investments. His report said that his fund managers asked for that information, but were told it was "confidential and proprietary." That included Solamere Founders Fund, a private equity fund run by his son Tagg Romney.
The campaign said a third trust for the Romney children, not listed in the disclosure, was worth $100 million.
The royalties for Romney's 2010 book, "No Apology: The Case for American Greatness," dipped to between $50,000 and $100,000. Last year, the royalties came in between $100,001 and $1million. Romney has donated the profits to charity, according to the disclosures.
The filings do not allow for a precise calculation of Romney's fortune. In January, he pegged his net worth at "between 150 [million] and about 200 and some odd million" dollars during an appearance on Univision. A recent analysis of his holdings by Forbes estimated his fortune to be worth $230 million.
Such wealth would make him among the richest occupants of the White House — a group that includes George Washington, whose net worth, adjusted to today's dollars, may have been as much as $500 million because of his land holdings.
Romney's riches have presented obstacles for him on the campaign trail, particularly in the GOP primaries, when rival Newt Gingrich cast him as out-of-touch with the average voter. Under pressure, Romney released his tax returns in January for the first time, providing a glimpse inside the complicated architecture of his far-flung holdings.
During the last two years, the Romneys paid about $3 million in federal taxes annually on an income of about $21 million, largely derived through capital gains and dividends, the returns showed.
In 2010, the Romneys reported a gross foreign income of $2.7 million, the best measure of how much they gained from international investments that year.
His campaign said that Romney gains no tax benefit from his overseas investments. However, a Vanity Fair article published this week revealed that Mitt Romney has heavily invested in foreign tax havens, raising questions about whether he's ever avoided paying U.S. taxes.
We already knew that he had a Swiss bank account until just last year, and that he still owns a mysterious corporation in Bermuda. The article notes that Romney's finances are "deeply entangled" with Bain Capital, including investment funds in the Cayman Islands. We don't know all the details because he won't follow precedent by releasing his tax returns, raising a lot of questions about his finances that Americans deserve to know the answers to. Take a look at this map of Romney's known investments in offshore tax havens, and make sure others see it, too:
Click Image To Enlarge
COMMENTARY: I would love to know what Willard's foreign investments are don't you? When I think of foreign tax havens, I think Caymen Islands. If you watched Tom Cruise in the film, "The Firm," you know what I mean.
With respect to Romney's foreign investments and bank accounts, Reuter's said.
"Romney advisers stressed that the holdings in the Caymans — along with those in a Swiss bank account that was closed in 2010 after an investment adviser decided it could be politically embarrassing to Romney — were reported on tax returns and were not vehicles to avoid taxes."
Under intense pressure from Republican house members, including former House Speaker Newt Gingrich and former Republican presidential candidate, Willard finally released his 2010 tax return and estimated for 2011. Here are a few highlights.
- Willard and wife Anne had combined income of $42.6 million over the past two years (2010 and 2011).
- Most of Willard's income came from capital gains on investments.
- Willard paid $6.2 million in taxes over the past two years-- about $3 million was for 2010 and $3.2 million for 2011.
- Willard made $7 million in charitable contributions over the past two years, including at least $4.1 million to the Church of Jesus Christ of Latter-day Saints (Mormon Church).
- Willard's effective tax rate for 2010 was 13.9%.
- Willard's effective tax rate for 2011 is expected to be 15.4%
Willard's effective tax rates for the last two years is lower than the vast majority of U.S. taxpayers. By comparison, POTUS Barack Obama and Newt Gingrich's effective tax rates were 25% and 31% respectively.
The Washington Post's Wonkblog looked at some historical data and found that Sen. John Kerry paid a 13.1 percent tax rate in 2003 and President Bill Clinton paid an 18.9 in 1990.
It's worth noting that Romney not only pays an effective tax rate that is lower than some middle-class Americans but he also pays a lower effective tax rate than most of his fellow millionaires.
The Tax Foundation reports had this to say:
"By contrast, millionaires pay an average rate of 25 percent. Although taxpayers earning between $2 million and $5 million pay an average tax rate of 26 percent, while those earning more than $10 million pay an average of 22 percent. We can speculate that one of the reasons for this is that much of their overall income comes from capital gains, which is taxed at 15 percent (only 20 percent of the total AGI for these $10 million-plus taxpayers is from salaries). However, even with this "preferential" tax rate on capital gains, the data clearly shows that their overall average tax rate is at least twice that of the nation as a whole."
Romney has vehemently defended his wealth and his tax rate, saying,
"I will not apologize for being successful."
During a late January debate, Romney added responded to questions about his tax returns:
"My tax bill is entirely legal and entirely fair. You'll see my income, how much taxes I've paid, how much I've paid to charity. I pay all the taxes that are legally required and not a dollar more. I don't think you want someone as the candidate for president who pays more taxes than he owes."
As a Republican taxpayer, wouldn't you want to know that your candidate for POTUS is paying ALL income taxes on domestic AND foreign investments. As reflected in the above, the precise value and nature of the majority of Willard's foreign investments is still unknown. If those foreign investments did not generate income, we all still deserve to know the nature of those investments, the value of those foreign investments, and if there were any losses.
Willard needs to come clean, and clearly demonstrate that he is abiding to U.S. foreign tax regulations and NOT making those foreign investments in order to avoid income taxes on that income.
If by happenstance Willard were to be elected POTUS (God forbid), we all deserve to know that he is honest and not willfully evading income taxes on his foreign investments. Tax evasion is a serious felony, punishable by fines and penalties and five years imprisonment, and it is also an impeachable offense. We all know how terrible dragging a POTUS through impeachment would be. I am jumping ahead of myself, of course. Willard has not been elected POTUS yet, but I dare ask,
"Would a Republican (hopefully changed to Democratic) dominated House of Representatives pursue impeachment proceedings against their own POTUS?"
When I heard that Willard had foreign investments in Bermuda, Cayman Islands, Switzerland and Luxembourg, and that those countries are known for their secrecy when it comes to protecting the identify of bank depositors, and have reputations as tax havens for the rich, I get a queezy feeling in my gut. I know one thing, if POTUS Obama had similar foreign investments, the House of Representatives would be demanding full disclosure, yet I have not heard shit from those punks in Congress. Kind of makes you wonder if our politicians have similar foreign investments, and just don't want to stirup a hornet's nest.