When ProPublica received a trove of tax data from an unidentified source — the largest confidential leak of tax records in U.S. history — the journalists there knew this data could provide an unprecedented window into how the ultra-wealthy avoid paying taxes.
“It seemed extraordinary,” recalled Jesse Eisinger, a senior editor and reporter at ProPublica. “At first glance, it was immediately clear that, if this was real, it was an amazing find.”
What followed was a months-long process to verify and analyze the information — using public records and independent verification — and then to turn this colossal volume of data into both a usable database and impactful stories.
The resulting ProPublica series, “The Secret IRS Files,” has won the 2022 Selden Ring Award for Investigative Reporting for exposing how some of the richest people in America take advantage of the tax code to avoid paying even a single dollar in income taxes in some years. The annual award, one of the foremost honors in investigative journalism, has been presented by the USC Annenberg School of Journalism for 33 years. The $50,000 prize honors investigative journalism that informs the public about major problems and corruption and yields concrete results.
“With more than 88 entries, this year’s competition for the Selden Ring Award demonstrated the remarkable breadth of intellectually rigorous, highly ethical, data-driven journalism with impact on communities around the globe,” USC Annenberg Dean Willow Bay said. “We are deeply grateful for our partnership with the Ring Foundation and proud of our shared commitment to recognizing and supporting investigative journalism.”
After ProPublica had painstakingly assembled a searchable database of millions of records, they then spent months combing through everything from SEC filings to court files to announcements of lottery winnings to detail how some of America’s most famous billionaires managed to all but wipe out their taxable income.
“We assembled an all-star team of reporters, editors and visual journalists,” said Eisinger, who served as coordinator for the series. “Once we started playing around with the database, we quickly saw that income and income tax weren’t the real story here. We realized a lot of these billionaires had very low income, and so their low taxes were a product of that low income. The first story had to compare the taxes they’d paid with their wealth growth, not their income.”
The series, which began in June 2021, walked readers through the sophisticated methods used by individual billionaires and their armies of lawyers and accountants — techniques that, while legal, are not available to or understood by millions of ordinary taxpayers.
ProPublica took significant risk in publishing these stories, given that federal law authorizes the prosecution of anyone disclosing individual tax records. (The U.S. government has vowed to pursue the person or persons who provided the information, but so far has not moved to prosecute ProPublica.) The newsroom also braved the risk of litigation from powerful individuals, some of whom had even been donors to ProPublica, which is why Eisinger describes the more than a dozen ProPublica journalists who worked on the series as an “all-volunteer army.”
“We talked about that risk,” Eisinger said. “We knew that some of these ulta-rich people were highly litigious, and while the chance that the federal government would try to prosecute us seemed low, it wasn’t nonexistent. But everyone was willing to take that risk, because we knew this was the biggest story of our lives.”
The judges commended the series for drawing “fresh attention to decades of rising inequality of both income and wealth, gaping loopholes in the tax code and the political influence of the super-rich — problems that have contributed to widespread erosion of trust in democratic processes and institutions.”
“It really is the key characteristic of our age,” Eisinger said. “You cannot understand the politics, economy or culture of the United States without understanding wealth inequality and the tax structure that helped create it.”
The Selden Ring Award has been part of USC Annenberg since 1989, when it was established by Southern California business leader and philanthropist Selden Ring to highlight the impact investigative journalists have on local, national and global communities. The award continues thanks to support from the Ring Foundation.
This year’s judging panel included: Lead judge Ron Nixon, global investigations editor, the Associated Press; Sewell Chan, editor-in-chief, the Texas Tribune; James Dao, metro editor, The New York Times; Jessica Garrison, Northern California correspondent, the Los Angeles Times; and Tracy Weber, deputy managing editor, ProPublica.
“We are incredibly grateful to the Selden Ring 2022 judges’ panel for their hard work,” said Gordon Stables, director of USC Annenberg’s School of Journalism. “Each of these accomplished journalists is already playing a significant role with their own work, and yet took on the formidable task of reviewing a highly competitive field of entries — all of which demonstrate just how pervasive impactful journalism continues to be across this country.”
The Selden Ring Award judges also recognized two finalists and gave one special citation.
Tampa Bay Times, “Poisoned.” Judges called the Tampa Bay Times’ 18-month examination of the problems at Florida’s lone lead smelting facility “a remarkable feat of local investigative reporting and an example of holding corporate and government institutions accountable.” The reporters disclosed a host of problems at the smelter, including levels of lead in the air there that were hundreds of times higher than the federal limit. They also found that eight out of 10 workers from 2014 to 2018 had enough lead in their blood to put them at risk of increased blood pressure, kidney dysfunction or cardiovascular disease. After the series began running, the federal government stepped up its monitoring of the smelter and the company is facing fines totaling hundreds of thousands of dollars.
The Wall Street Journal, “The Facebook Files.” “There’s been no shortage of reporting on Facebook’s inaction as its platform has been used in malignant ways,” the judges wrote. “But when Wall Street Journal reporter Jeff Horwitz obtained a trove of internal Facebook communications from a whistleblower, the world suddenly had vivid proof.” Not only were Facebook leaders aware that the platform was harming millions of people, Horwitz’s work showed that those leaders chose to ignore warnings from their own data scientists that it was being used to incite violence against ethnic minorities, being exploited by human traffickers and autocrats, and that Instagram was damaging the mental health of teenage girls. The Journal series eviscerated Facebook’s assurances that it was doing all it could to protect users, prompting multiple congressional hearings, a regulatory push in the European Union and United Kingdom and a rebuke from its own oversight board.
Special Citation: The Charleston Post and Courier and its 17 community news partners for “Uncovered.” The judges gave special citation to the Charleston Post and Courier for its series on rising local corruption in South Carolina, partly a consequence of the decline in local news sources and the reduced number of watchdogs holding local officials accountable. Teaming up with other newspapers throughout the state, the Post and Courier and its partners found that government officials from state legislators to city council members to town administrators engaged in unethical behavior — including going on taxpayer-funded junkets and outright stealing from government coffers — while no one was looking. Judges said the series and the local partnership “provides a model for news organizations in other communities with news deserts.”