John Kerry: No Blind Trusts, Tax Avoidance, and Conflicts of Interest
The Massachusetts senator's personal financial holdings are rife with tax dodges and reek of hypocrisy.
September 7, 2011 - 12:00 am
Senator John Kerry (D-MA), the richest member of the United States Senate and one of the most senior members of the debt super committee, is seen as an advocate for raising taxes on the rich, echoing the Obama administration. But with a net worth over $230 million, Kerry and his wife — whose $1B net worth dwarfs her husband’s — over the years have avoided millions of dollars in taxes through a complex web of inherited trust funds. Last year alone they earned about $4.8 million for which they paid no taxes.
Moreover, the Kerrys haven’t placed any investments into a blind trust, as recommended for avoiding conflicts of interest. They also have numerous stock investments in companies standing to benefit from Kerry’s voting for bailouts and ObamaCare.
According to the Center for Responsive Politics (CRP), the 12-member super committee, charged with cutting the national debt $1.5T, “by and large, are far wealthier than the average American.”
Leading the pack, financially speaking, is Senator Kerry, whose net worth is estimated to be $239M (averaging the latest available estimated minimum and maximum values from CRP). This is about 2,500 times the average American’s net worth of $96,000.
John Kerry is a descendant of the Winthrop-Forbes family. John Winthrop “founded the Massachusetts Bay Colony in 1630 and served as governor.” The Forbes family dates back to the mid-18th century, when Reverend John Forbes moved to Boston from East Florida. Winthrop-Forbes trust accounts cover seven pages of Kerry’s latest available financial disclosure report. Kerry inherited all his wealth: Excepting his $174,000 senatorial salary, Kerry’s income comes from “publicly traded assets and unearned income sources.”
Kerry’s wife Teresa inherited husband H. John Heinz’s fortune when he died in 1991. In 2008, Forbes estimated her net worth at $1B. Her “H.J. Heinz III Marital Trust” and “Heinz Family Investment Bond Fund” cover nine pages of Kerry’s financial report, comprising 178 municipal bond investments worth an estimated $78.8M ($61.0-$96.6M), earning about $4.8M last year in tax-free income ($4.7M-$5.0M).
On July 23, 2010, the Boston Herald reported that Kerry berthed his new $7M yacht in Rhode Island, which had repealed its “Boat Sales and Use Tax.”
Sen. John Kerry, who has repeatedly voted to raise taxes while in Congress, dodged a whopping six-figure state tax bill on his new multimillion-dollar yacht by mooring her in Newport, R.I. [emphasis added]
A week later, Kerry explained that he “always intended to pay taxes in Massachusetts” and “mishandled the public furor over his decision to dock the vessel in tax-free Rhode Island.” His decision was partially motivated to forestall a potential tax evasion investigation by the Massachusetts Department of Revenue.
Recently, Kerry said “difficult choices will be made in Washington in the future” and “cuts should be properly balanced by new revenue sources.” Herein lies the focal point, because “new revenue sources” is bureaucrat-speak for solving the budget crisis through increased taxes.
But Kerry’s actions to avoid personal taxes are only one aspect that conflicts with his qualifications to help resolve America’s financial crisis.
In their attempt to derogate Congressman Darrell Issa for allegedly using his position to further his own business interests, the New York Times promoted the criteria that representatives should place their investment portfolio into a blind trust, which Issa hasn’t:
Most wealthy members of Congress push their financial activities to the side, with many even placing them in blind trusts to avoid appearances of conflicts of interest.