We can fight Trump right here in Delaware by passing a LLC Disclosure Bill
“Across Mr. Trump’s business, he uses a similar web of privately held LLCs and other entities to house his assets—everything from real estate to a vintage carousel in Manhattan’s Central Park, according to a Wall Street Journal analysis of hundreds of pages of his corporate filings and personal financial disclosures. Fifteen entities, for example, are used to hold his interests in two airplanes and three helicopters.”
“Unlike publicly traded companies, Delaware LLCs don’t have to publish any financial information or even disclose the identity of the owner… None of the 96 LLCs examined by the Journal appear to regularly release audited financial statements. That opacity—compounded by Mr. Trump’s decision to break with decades of precedent by declining to release his tax returns—makes it impossible to gauge the full extent of potential conflicts between his business interests and presidential role.”
It is time for the Delaware General Assembly to end this practice of corruption. But it is likely they won’t for this very simple reason:
One reason Delaware has resisted any change to this system: It’s a huge part of the state’s income. According to The New York Times, taxes and fees from these absentee businesses accounted for a quarter of the state’s budget in 2011. In 2015, the Delaware’s secretary of state retained the huge lobbying firm Peck Madigan Jones to lobby on “legislation impacting corporate formation process” and “issues relating to beneficial ownership,” priced at $50,000 per quarter. The state also retained Peck Madigan Jones to lobby on beneficial ownership in 2009; the firm has been retained by the state since 2009 to lobby both the House and Senate on other issues, too, paying as much as $90,000 a quarter.
The Delaware General Assembly is addicted to this revenue because it allows them to ignore the non-progressive flat tax system we have for upper incomes here in Delaware. Instead of raising revenue through adding additional income tax rate levels between $60k and $6M in yearly income, the Delaware General Assembly would rather further enable people like Donald Trump to avoid paying taxes.
An LLC disclosure bill will not, in any way shape or form, threaten Delaware revenue. It probably will threaten the revenue stream of the half-dozen corporate law firms who currently peddle LLC licensing access at a premium price far and above the standard $250-$300 fee that can be enjoyed by any person, entity or business that wishes to achieve LLC status/protection. Why? you might ask, pay more for a privilege that you are free to avail yourself of. Answer that with the reality that any of the “corporate bar commission” firms that create the LLC license for their clients (big businesses, small businesses, non-profits, hidden interests groups, individuals or even “shell companies”) have the attorney who serviced them listed as the agent/contact and responsible go-to party for that LLC business (ever imagine that “attorney-client” privilege would be a cleverly resourceful tool for questionable activities?) When I introduced an LLC licensing reform measure last year (which I intend to refile this year) the Corporate Bar Commission was given to an apoplectic fit of indignation. Rep. Melanie Smith (a member of one of these firms) requested that before I file the measure that I meet with a group of them. I submitted myself, Christine Whitehead and Nick Wasilewski (my co-conspirators) to this inquisition and was promptly accused of undermining Delaware’s global reputation. I replied that I imagine they had not been reading any newspapers (local or international) if they thought I was disparaging an already horribly reputed Delaware system. Panama Papers, Cayman Islands and Switzerland were my references. They refused to engage with ominous suggestions that our efforts would be stopped by those in the GA who wielded more influence. Therefore I am preparing to reintroduce that measure once again in early January. Any of you that wish to discuss a more detailed account of what transpired my cell is 302 547 9351
Representative John Kowalko
Representative John Kowalko
Doing this would be better than nothing, but it is not really fighting Trump.
The reason? This kind of fight only works in countries that abide by “the rule of law.”
We’re moving into our banana republic phase, in which only what the caudillo says is the rule of law.