Tax Analysts Blog

Jeb Bush Takes a Page From Richard Nixon by Disclosing Personal Tax Returns

Posted on Jun 30, 2015

Jeb Bush is poised to take the lead in this year’s race for most transparent candidate, and will release 33 years of personal tax returns on his campaign website this afternoon. It’s a bold move – and a shrewd one. As Richard Nixon discovered 63 years ago, financial disclosure can be embarrassing but it’s also good politics.

In 1952, while running for vice president on Dwight Eisenhower's GOP ticket, Nixon found himself at the center of a brewing scandal over his campaign and personal finances. "Secret Rich Men's Trust Fund Keeps Nixon in Style Far Beyond His Salary," roared a headline in the New York Post.

The campaign fund in question was not illegal, but it was certainly embarrassing. To contain the damage -- and even take the offensive -- Nixon decided on a strategy of aggressive disclosure.

In his famous Checkers speech, Nixon laid out his personal finances in considerable detail. It was an ode to openness and humility. "That's what we have, and that's what we owe,” Nixon declared with more than a hint of self-righteousness. “It isn't very much. But Pat and I have the satisfaction that every dime that we've got is honestly ours.”

Nixon did acknowledge accepting one notable gift from a political supporter: a cocker spaniel named Checkers. "The kids, like all kids, love the dog,” Nixon said. “And I just want to say this, right now, that regardless of what they say about it, we're gonna keep it."

Nixon’s charm offensive was cute and effective. He even managed to leverage his transparency for political gain, pressuring the Democratic ticket (featuring Illinois Gov. Adlai Stevenson for president and Alabama Sen. John Sparkman for vice president) to follow his lead. "I would suggest that under the circumstances, both Mr. Sparkman and Mr. Stevenson should come before the American people, as I have, and make a complete financial statement as to their financial history," Nixon said. "And if they don't, it will be an admission that they have something to hide."

Stevenson and Sparkman eventually agreed, and they upped the ante by releasing a decade's worth of personal tax returns. Nixon refused to follow suit, but Eisenhower proved more amenable to tax disclosure. He gave reporters a summary of his own personal taxes, which were largely unremarkable (but included a special dispensation from the IRS allowing him to treat book royalties as capital gains).

Eisenhower’s openness didn't start a trend -- candidates wouldn’t begin routine disclosure of tax information until much later. Indeed, regular disclosure would await Nixon's own election as president; in 1973 a beleaguered Nixon agreed to release his own returns, inaugurating a new tradition of routine tax disclosure by White House occupants.

Still, the Checkers speech underscored the political utility of voluntary disclosure, even if Nixon put limits on what he was willing to reveal. The episode set a new standard in financial transparency.

Nixon understood that Americans want their presidents (and their candidates) to lay bare their personal financial lives. "A man that's to be president of the United States, a man that's to be vice president of the United States, must have the confidence of all the people,” he said during the speech. “And that's why I'm doing what I'm doing."

Jeb Bush seems to agree with Nixon’s assessment of popular opinion. And like all of today’s White House candidates, he’s seen what happens when politicians ignore the call for transparency -- Mitt Romney tried mightily to keep a lid on his personal finances, and it did not go well.

Bush also seems to understand that tax transparency can give you a leg up on your opponents. Nixon used his Checkers speech to turn the tables on his Democratic rivals. His openness even gave him enough credibility to resist calls for further disclosure.

When done right, in other words, transparency can be unpleasant for candidates. But it can also be very useful.

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