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Taxes And The American Corporation

American corporations paying zero in American taxes, starting with General Electric. We’ll look at what’s going on.

Jeffrey R. Immelt, right, General Electric's chief executive, was appointed by President Obama to head the President's Council on Jobs and Competitiveness. (AP)

Jeffrey R. Immelt, right, General Electric's chief executive, was appointed by President Obama to head the President's Council on Jobs and Competitiveness. (AP)

Just over two weeks until tax day now -– April 15th. You may be burning the midnight oil, trying to figure out what to pay, how to pay, how to save a buck. American multinational corporations have that game down.

In the 1950s, almost a third of federal tax receipts came from corporations. Today, that’s been whittled down to 6.6 percent.

Some of the biggest global players are parking profits overseas, and paying little or nothing at home. It’s legal. But it’s also been lobbied to a fare thee well. At a time of massive deficits, some call it corrupt.

This hour On Point: U.S. corporations, global tax games.

- Tom Ashbrook

Guests:

David Kocieniewski, tax reporter for the New York Times.

Martin Sullivan, contributing editor for Tax Analysts, a non-profit, nonpartisan group that produces research and analysis on tax policy.

James Hines, professor of Law and Economics at the University of Michigan and an expert on tax issues.

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  • Anon (Boston)

    What’s the deal I can do where I get money back from the IRS?

  • Michael

    The Irish are lucky, they manage to cut there corporate tax rate to 12.5 % to attract such companies and look how those companies stay and bail them out of there current recession…….. wait that was the EU.

  • Michael

    I hope the guest aren’t going to be presenting the same debunked belief that if only we lowered our Corp taxes like those socialist Europeans everything will be all right, than claim we can close all the loop holes and the government will receive even more tax revenue. Which totally misses the obvious lobbying,exceptions and incentives i.e. loop holes that would be placed right back in any tax system.

    • Ryan H

      Fair Tax baby! Everyone pays and it lowers the power of the lobbist and Congress. I still haven’t heard any strong arguements against the Fair Tax. You have any? Do you agree with the Fair Tax?

  • Nick from Central Mass

    LARGE BLOCK STORES DO NOT TURN IN THE SALES TAXES WE PAY !

    I have heard this several times that CABALA, TARGET, and other large blocks store chains collect the sales taxes we pay at the cash register but keep it instead of giving it to the state.

    Is that true and is so, could you address it.

    • Mogl

      Yes, it is true. They label it “financing”. Many, many, many communities have agreed to let the corporations keep the sales “tax”, ostensibly in exchange for “creating” jobs.

  • Michael

    Many dislike the IRS and paying taxes, but there’s a reason why the IRS is so tough and it’s complication.

    A case study we did in my Tax accounting class back in collage involved a family who had a vacation home where they rented the vacation home out 1 week out of the year, but figure out (until it was closed) that they could at the time claim losses the other 51 weeks. Even know there had no intention of renting it out. The Tax Law was changed to a % on how long the family stays in the vacation home.

    It’s actually even easier to cheat on ones taxes when the tax code is simple. Which would be a wet dream for some of our Top Corporations.

    Close incentives to outsource jobs oversea,create tougher penalties for companies that hide there taxable income and who engage or work with companies that use slave labor. Along with toughening up the rules on overseas subsidiary.

    But so far what congress and the white house has called for is, cutting the IRS(increasing the debt) more corporate tax breaks and incentives and making it easier to outsource.

    • Ryan H

      Michael, you are such a typical left winger. When will ya’ll realize we are in a global market now? If a company can produce their products for less in another country then that is their right to do that. You don’t need to penalize them, lol.

      Although I do agree that our tax system as grown too convoluted and needs to be overhauled to a more consumption based tax.

  • tom

    A lot of the coverage I’ve seen lately on this topic–most recently, 60 Minutes–seems to miss the point; either the US treasury can continue to collect 0% of the 1.3 trillion US companies have overseas or they can lower the rate and collect, say, 15% or 20%. Companies such as Cisco, Google, Apple, etc. can find more efficient ways of putting it to work overseas than if they bring it back to the US and lose 35% of it.

    I’ve heard a lot of commentators saying that these companies are asking for a freebie or special treatment; they aren’t — it’s their money (and that of the shareholders). It doesn’t, as many people seem to think, already belong to the IRS.

    Also, you don’t have to be rich to benefit from a lowered corp tax. Even if you have a small amount of money invested you will reap higher dividends if this money is brought to the US — what’s wrong with that?

    Finally, being stubborn and insisting that the US should keep the rate at 35% is self-defeating; the US is already the odd man out on this and the rest of the world has realized that a lower corp tax rate means they can collect money and talent that really could be in the US.

    • Ryan H

      Nicely said Tom!

  • roger

    we are just lucky to have jobs and the crumbs the corporations leave us. if they could accomplish the work cheaper with robots, they would. reminds me of the tennessee williams song “sixteen tons”.

    • Ryan H

      We are in a global market now Roger. You are competing across the world, not just your neighbor now. Step it up, things have changed. Competition is great! Don’t you love capitalism?

    • julie rohwein

      I think you probably mean Tennessee Ernie Ford, who sang “Sixteen Tons” most famously. Though he did not make the first recording — that was Merle Travis in 1946. There is a dispute about the authorship of the song–both Travis and another singer, George Davis, claimed to have written it. But Tennessee Williams, the playwright, has no connection to this song.

  • WMaher

    I’m not getting it here. The people of Michigan just got through begging for and accepting billion dollar welfare handouts to keep their biggest corporations operating. Why? You had a great chance to discard these awful corporations. All corporations do is provide you, your friends, and your family with tons of great paying jobs.

    • Ryan H

      BAM! You hit the nail on the head WMaher! When companies were poorly run and ran into the ground by unions, they get a bail out. But if GE goes and makes a profit, holy hell they need to pay more taxes!

      • Jim in Omaha

        I may have missed it, so please enlighten me: Just what unions were involved in the destruction of our economy by the financial sector? And in your scenario, why won’t other countries just keep lowering their tax rate to less than ours in your proposed race to the bottom?

        The only questions that need to be addressed are:
        1. Why is the share paid by corporations of what is needed to run our country at an all-time low while their profits are at an all-time high?
        2. How will your proposal decrease the unprecedented inequality in income and wealth in our country?

        Looking forward to your answers to these real questions.

        • William

          Was the economic problems caused by the financial sector or just the government housing agencies?

          • Anonymous

            Answer: Financial sector – who dumped their crappy financial “instruments” on the govt agencies because they knew they would be protected and the American Tax payer would be forced to pay for their greedy risk-taking. Plus an added bonus: They got to blame it all on poor people for being duped into believing they could own property while they were being sold a false bill of goods. Don’t they know they can only rent from their betters!!! Yeah so fair. :(

          • Jim in Omaha

            Yes, I think the unlimited mortgage deduction, vacation-home interest deduction, artificially low interest rates to encourage overextending oneself, cheerleading support of a so-called “ownership society”, deregulation of the home financing industry, all played a role. Is that what you’re referring to?

          • William

            No, the problem with Freddy/Fani owning the majority of all the mortages (90 percent)?. That was and still is the problem. The taxpayer has no business being in the home loan business.

          • Jim in Omaha

            And just who do you think benefits from this arrangement? If you say low income people trying to buy a house, you are wrong. The answer is mortgage lenders, bankers and the sector of the financial industry that made huge sums of money securitizing those Fanny/Freddie backed loans. Without these entities, there would be no market for the making of home loans in the U.S. Now, you may find that acceptable, but the impact on realtors, home builders, title insurers, and everyone connected with that market would be devastating. Or do you think some other entity would step in to take their place?

  • http://moreover.myopenid.com/ moreover

    Joshua Holland of Alternet.org brought it to a point in a recent article:

    “Thirty years ago the Right convinced a lot of Americans they could enjoy tax cuts without losing out on any of the services they’d come to expect. That’s a big part of why our public debt jumped from $997 billion when Reagan took office to over 14 times that number today.

    We could have paid for everything as we went through higher taxes but we didn’t – in 2008,we ranked 26th out of the 30 countries in the Organization for Economic Cooperation and Development in terms of our total tax burden (the share of our economy we fork over to the government), coming in almost 9 percentage points below the average of the group of wealthy nations.”
    source: http://www.alternet.org/economy/150371/five_fun_facts_about_the_%2414_trillion_national_debt/

    • William

      I have always wondered about the statement “services that we have come to expect”? What are those services?

      • Ryan H

        Roads, Judicial System, FBI, CDC, EPA, Military, Fire Fighters, USPS now ObamaCare. I’m sure I’m leaving out lots more, but I feel these services are essential to keeping America running as a well oiled machine. All else should fall to the waste side and become defunded to lower our crushing debt.

        • William

          But the services you listed are usually fully funded at an adequate level. Obama-care being the exception since is it poorly planned. I have to question the idea that government or people in government seem to be pushing the idea that any service is “demanded by the people” when most of the people I talk to never demand much if anything beyond the basics.

          • Ellen Dibble

            William, services are “Usually fully funded”? If they were not, we would vote the rascals out of office so fast.
            Instead, we provide the service (wars against people who did NOT attack us on 9/11, drugs for seniors that were NOT properly negotiated for price control, as I understand), but instead of taxing ourselves for that, we pass the bill to our children — whose oil will not be cheaper, whose health needs and care will not be less, whose planet will not be greener…

        • nj

          “…well-oiled manchine…” Now, that’s funny.

          Roads (and bridges and other infrastructure): badly failing.

          Firefighters (and police and public works, etc.): drastically cut in many municipalities

          USPS: Closing Post Offices, limiting services

          Military: Constantly increased budget for continual war; accounting systems so FUBAR they can’t even tell where hundreds of millions of dollars are lost.

  • Bruce Guindon

    give to the rich and take from the poor slowly evolve into a Fascist state that is what is happening in the America that has no checks and balances perhaps, a large tax on Lobbyist would make everyone think differently
    And if corporations are now people then we must imprison them when they cross the line or simply take them over for the time of the sentence with all profits going to the American people. Stop welfare for corporations they do not support America they out source the jobs why give anything to the criminals whose greed set in motion the end of the middle class. What am I not seeing, please explain why some most pay more than they have and corporations pay little or nothing or move their headquarters to another location and avoiding paying taxs at all WTF

    • Bgaidry

      1. Technically we have a Plutocracy.

      2. The whole point of corporations is to limit liability. You can’t put a corporation in jail. They can kill people, they can ruin your health, they can make entire communities uninhabitable, but all they will get is a fine.

      The most effective remedy, which never gets talked about is THE DEATH PENALTY FOR CORPORATIONS, revoking their corporate charter, taking away their limited liability, their citizenship and their very existence.

  • Yar

    The laws that must be changed for tax reform are not directly related to tax law. Campaign finance reform is necessary to accomplish tax reform. We have tax law established through financial political support.
    We can’t even see the real data of who pays what tax. Take GE for example, its employees pay income tax, its shareholders pay capital gains tax, to get a true picture of the tax load distribution we would have to see the total earnings and look at tax distribution over income ranges. Many ‘taxes’ are not ever called a tax, healthcare has a tax component, the ‘tax’ burden in healthcare is regressive. Many fees are also regressive, credit card and banking fees for example, these are not called taxes but support large components of our economy. They are paying for our past financial crisis going back to the savings and loan debacle of the Clinton administration.
    I would like to see a study of who pays what share of our social structure by income distribution. Looking at income and corporate taxes in isolation ignores huge parts of the economic equation.
    We have the best tax law money can buy.
    The only way I think it can be changed is to elect leaders who pledge not to take any campaign money while serving in office. Elect a majority of common citizens who vow to return to a democracy and we will likely have a revolution, led covertly by the money interests.
    One last tax, inflation, deficit spending is a tax on income, how is inflation ‘taxing us’ across income distribution?
    Please look at the big picture.

  • Mogl

    Why does no one ever discuss what theses corporations GET in return for US taxes. US “citizenship” (corporate or otherwise) has benefits. If they did not benefit from it, we would not be having this discussion. If there was a better DEAL to be had, they would incorporate elsewhere.

    • Bgaidry

      An indeed many are. Some simply move their profits overseas to avoid taxation, while others like Halliburton have so much profit to hide they have to move their entire headquarters overseas.

  • Anonymous

    GE: Representation without taxation.

  • William

    I wonder how much unemployment insurance tax, social security tax, workman’s comp. tax, local tax, property tax, etc..GE paid?

    • Anonymous

      True, but I also have to ask the question, “How can the progressive democrat president be so friendly to a company that is clearly not paying its fair share as defined by the president and his party?” He appointed GE management to government advisory posts even

      • William

        The only really progressive I can think of was FDR. He really went after big business and the wealthy. Which seemed odd since he was wealthy. MSNBC did everything possible to help Obama get elected and Obama has now rewarded their parent company, GE very well.

      • Ryan H

        Goes to show that ALL politicians are “Professional BSer’s” that are corrupt and live to add more dollars to their next campaign fund at someone elses expense.

      • nj

        The rightwingers are the only one calling Obama “progressive.”

        • Ryan H

          Not this rightwinder. ALL politicians are corrupt. Reforming the tax code (if done right) will bring this country back on track. Fair Tax baby!

  • Alex

    Interestingly enough, if you are an individual working abroad, USA wants its income tax no matter what. I have been recently interviewed for a job with the European Bank for Reconstruction & Development in London. It employs expats from all over the world. Employees of this institution are not subject to income tax in Britain or in the countries of their origin pursuant to the founding treaty. But I was told that because I am from the US I will have to fork over income tax to the IRS and that the US is the only country-participant that does it.

  • http://moreover.myopenid.com/ moreover

    In (my native) German, the word for taxes is “Steuern” which translates as “to steer” or “steering wheel”.

    That is the role of the state: to give direction on a macro level, and it’s done in part by taxes that incentivize or disincentivize behavior of individuals and corporations.

    The illusion that the hailed ‘market’ will magically sort everything out is just that, an illusion.

    Taxes that are fair and taxes that generate generous government revenue that give room to maneuver are well accepted in well governed countries.

    In the US, taxes are
    a) not fair
    b) too low given the tasks at hand

    Hence, people think they’re not getting their money’s worth.

    • Ryan H

      I’d have to disagree with you Moreover on your statement:

      “The illusion that the hailed ‘market’ will magically sort everything out is just that, an illusion.”

      It’s not an illusion, it is an adaptable machine that kills off weak portions of the market and rewards stronger portions of the market. Just like nature!

      I don’t believe government should “steer” or plan the economy, this only causes trouble. Look at the housing market! The governments role should be: leave the markets alone, preserve people’s rights, protect people from harm. That simple!

      Although I strongly agree that our tax system in America has gotten way too convoluted and needs to hit the reset button. I would be in favor of some sort of consumption tax, which I believe will help minimize corruption in government.

      • Alex

        “The governments role should be: leave the markets alone, preserve people’s rights, protect people from harm. That simple!”

        “Harm” includes that inflicted by the markets. Therefore, the government should never leave the markets alone.

        • Ryan H

          How does a free market harm someone?

          It gives everyone an opportunity. Why do you think government should limit or retard free markets?

          • Alex

            Free markets or rather free market participants may harm people in a variety of ways if it means more profit: by destroying the natural environment, by subjugating the labor, by putting dangerous products into a stream of commerce (e.g. exploding Pepsi bottles, toxic securities, etc.), by killing the competition, by purchasing the politicians, etc. If we are not careful, we will be living in Honduras in no time.

          • Dave in CT

            Set up rules of the game, and demand accountability to them.

            We have just been asleep at the wheel, or cowardly, about holding white collar criminals and collusion between corrupt government and big-business interests accountable.

            Seen any heads roll lately?

          • Ellen Dibble

            “We” are asleep at the wheel? Our press, our journalists, our radio shows are not telling us day by day who is lobbying whom, where, why, and with what intent. Lobbying, which is so influential, is NOT hot news until it is too late. Our ability to vote for and elect people KNOWING the “strings” they are attached to, has been vitiated. How? By the press. Or maybe it’s privacy laws. Every dollar has not only freedom of “speech” but also freedom of non-transparency. (Secrecy.)

          • Dave in CT

            I’m still waiting for that critical mass of people who aren’t clamoring for socialism as the alternative, but simply accountability to a fair set of laws within which markets operate, and some hard core punishments to be doled out along with tarring and feathering at least.

            Punishment has to come one way or another. Crony capitalism and Socialism punish the rest of us.

          • Dave in CT

            I’m still waiting for that critical mass of people who aren’t clamoring for socialism as the alternative, but simply accountability to a fair set of laws within which markets operate, and some hard core punishments to be doled out along with tarring and feathering at least.

            Punishment has to come one way or another. Crony capitalism and Socialism punish the rest of us.

          • nj

            Friedman: The social responsibility of business if profit.

          • nj

            There’s no such thing as a “free market.”

            Any organized, participatory system has rules, regulations, guidelines. It’s a matter of how those are established, who establishes them, and who they favor.

          • nj

            There’s no such thing as a “free market.”

            Any organized, participatory system has rules, regulations, guidelines. It’s a matter of how those are established, who establishes them, and who they favor.

      • http://moreover.myopenid.com/ moreover

        Your position is called “market fundamentalism” and looks much like a religion: those who fervently believe it fail to see what outside observers clearly see as false.

        Societies and economies of any scale require government, period.
        What we should strive for is GOOD government.

        As for “corruption”: In Germany the blatant purchasing of lawmakers by corporations that is the rule in the US is illegal.
        Campaign finance revolution – not mere reform – is a prerequisite.
        Obama’s second biggest early campaign financier was Goldman Sachs, as Daniel Ellsberg said Thursday at Harvard Law School. He also said, and I quote: “They got their money’s worth…”

        • Ryan H

          I agree that government is required in any society. But your definition of “GOOD” government is different from mine. I’m pretty liberatarian about government.

          Government should keep me safe (Judicial System, CDC, EPA, Military) and pave some roads. That’s it.

          Government should NOT poke their fingers into markets and try to “steer” it. It only invites corruption!

          Capitalism is a beautiful! Everyone has a chance.

          • Anonymous

            Everyone has a chance in genuine capitalism, but what we have are not what Adam Smith had in mind. We have something more like an oligarchy in our economic system.

          • Chris B

            Capitalism is social Darwinism by another name. “Everyone has a chance”? That is fantastical BS. Everyone who’s well connected has a chance! Otherwise, it’s “eat the wounded”.

          • Ryan H

            Sorry you feel that way, but everyone does have a life and a chance. You must be one of those people that feel they are entitled to things and your life should be made easier to even the playing feel.

          • Chris B

            Wrong, tea bag. I have a good life and a good job. But I see the suffering of a lot of other people who work hard, live clean and are getting being screwed by a system rigged to favor those who already “have”. Maybe in a few hundred millenia your ilk will develop the genes to see it too.

          • Ryan H

            Ahh yes, there we go with the name calling. You can always depend on a liberal to name call first. So typical.

            You have to do more than work hard. You also have to work smart. For example, if a brick mason only moves bricks back and forth that is working hard, but not smart. If that brick mason takes the chance and starts his own company he has a better “chance” to rise to the top.

            “There is no such thing as luck, what you call luck is what I call preparation meeting opportunity.”

          • Anonymous

            Uh, yes, there is such a thing as luck. Being born with the personality to succeed in business is one kind of luck. Encountering the opportunities that you name is another kind of luck. Also, being born into a family with lots of connections is a kind of good luck–as my history teacher in college said, some people choose their parents better than others.

          • Chris B

            Insufferably glib.

          • Alan Shulman, NH

            Ryan H.: Please note that the comment, “you can always count on a liberal to name call first,” is itself name-calling, not a point in a well-formulated argument.

          • Chris B

            Actually, he started off with, “You must be one of those people”, which is name calling in my book.

          • nj

            [[ Government should keep me safe (Judicial System, CDC, EPA, Military) and pave some roads. That's it. ]]

            Yep, we should all drill our own wells, dispose of our own sewage, test our own food for safety, develop our own individual building codes…

          • Ryan H

            I couldn’t name everything. But drill your own wells you can do.

          • Anonymous

            Good luck in your neighbor has dumped poison near your source of water.

          • nj

            Tell the people in Manhattan or Cambridge or Chicago or Houston to drill their own wells.

            You couldn’t “name everything” because that would expose the simplistic, unworkable tenants of your “libertarianism.”

          • Jim in Omaha

            WHY should government do the things you think it should? WHY should it keep you safe? Can’t you get that service on the free market? Can’t the free market get you roads? As a believer in “free markets”, don’t you consider it essential that all real costs are internalized? How do you propose that be enforced? What is the underlying principle that you rely on to decide just what a government should do and not do? You do realize that your views would require our US Constitution to be changed, right?

      • Alan Shulman, NH

        The “free market” is never free. It is always influenced and distorted by corporate power. It brings us polluted and deadened oceans, devastated forests, over-fertilized farmland whose run-off destroys fish stocks, shellfish beds and the breeding grounds for birds, just to name a few, all in the name of an amoral profit motive. And unlike in nature, the strong can maintain their position of strength without counter-balance. If wolves get too strong, they kill off too much of their food supply and have to starve for awhile until that food supply recovers. Who starves Exxon-Mobil?

        • Alan Shulman, NH

          read “can’t maintain” instead of “can”

          • Ellen Dibble

            Alan, hi. You can edit your comments now, at least you can if you use the Disqus sign-in.

  • http://moreover.myopenid.com/ moreover

    Heard Amy Myers Jaffe last week in an energy seminar at Boston U’s Pardee center. She said that Bahrein’s fuel subsidies could also be seen as a tax of sorts:

    The gov’t spends about $3500 per citizen/yr to keep domestic fuel prices low. However, the rich – who buy more fuel – make use of that subsidized fuel much more. Figures are roughly $5500 for well off vs $800 for poor.

    She wonders whether it might not make more sense to drop the subsidy and simply hand out the original $3500 to all citizens.

    Interesting perspective: the poor in effect subsidizing the rich. There are parallels, I’m sure.

  • William

    A industry that seems to pay very little in taxes compared to their profits is the software industry. Google saved over 3 billion in federal taxes last year by accounting tricks with moving their money through Ireland. Google of course, was another huge Obama supporter.

  • Alex

    If these corporations are overseas , don’t hire American workers and don’t pay American taxes then they are not American companies , they should pay import taxes .

    • Alex E.

      I did not realize there was another alex on this board I will call myself alex E.

    • Alan Shulman, NH

      Alex: Perhaps it’s not an either-or situation. How about, to the extent an “American” corporation is overseas in plant and personnel, then to that extent it gets taxed as a foreign corporation?

  • Cory

    We must test the assertion that corporations and the wealthy will take away all our jobs if we tax them more.

    • Alan Shulman, NH

      How many jobs has GE outsourced despite its non-existent tax rate? Isn’t that your test right there? It seems to not make much difference. The wealthy invest where the greatest profits are; if those profits aren’t here, neither is their money. I don’t really see what taxes have to do with it?

  • David

    Why should American citizens pay their taxes so that these criminal corporations can not only pay nothing, but get refunds from the government out of our tax money?

    It’s time to stop being suckers taxpayers if our government doesn’t end this outright criminality and theft of our money.

  • Chad

    The corporate tax rates in the U.S. are higher than any other country. Corporations are left with no other option than to put their money overseas; corporations after all are in the business of making money for their shareholders. The institution of a National Retail Sales Tax (FairTax.org), would effectiviely eliminate all these miscellaneous and imbedded tax structures, making all of this discussion unnecessary.

  • Ellen Dibble

    Does GE have a bullet point for a solution (to our debt, basically)? Or do they just think the US should have across-the-board lowest-on-the-planet taxes, to even things out between GE and me?

  • Pcalley

    It all comes down to this: corporations are designed to benefit their shareholders, not their neighbors.

    Patrick, Boston

  • Tina

    THANK YOU FOR THIS SHOW!!

  • Anonymous

    But do we have a free market? How is a company like Walmart an element of such a system? Adam Smith’s idea was that the business would be a local one and the owner and I would know each other. We’d know the value of the product being sold. Thereby, we’d come to an agreement on the price. That’s not happening these days.

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Can you imagine? Going into Wal-Mart and haggling over the price of a box of cereal.

      “This can’t be worth more than a quarter.”
      “Sorry, sir, it’s five dollars.”
      “How about A dollar?”
      “Security.”

  • Clinton

    Is there anyway that Tariffs could be used against corporations like GE that cheat our country out of tax revenue?

  • Anonymous

    In Smith’s formulation, everyone would have an equal chance. We’d all act in our own interests and according to our own abilities, and we’d deal with local businesses that we understood.

    Yes, that’s fantasy today. I’m a (moderate) libertarian, and in that position, I support sensible regulations on corporations with the goal of defending the liberties of individuals.

  • Michael

    It might be worth asking: what do taxes actually reflect? Are they a matter of pragmatics? Of moral obligation? How do we put a dollar value on what a corporation owes society?

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      You let the people of that society decide.

      That’s called government.

  • Jem248

    Tax policies for corporations should be changed so they are encouraged to invest in America, and not overseas. Right now we appear to be doing the opposite. But, please explain how they get these enormous tax credits – it’s bad enough they don’t pay taxes, but to get credits on top is outragious.

  • Ellen Dibble

    What nut was it that allowed a tax ADVANTAGE to corporations for shipping jobs overseas. I can’t believe when I hear that? Which senators voted for THAT? Which congresspeople…

  • Anonymous

    Because of our 35% corporate rate, it is very usefull for companies to spend millions to not pay millions of dollars. If we dropped the rate to 20% all past data shows that government revenues from the tax will increase because companies have almost half the incentive to not pay their taxes!

  • Worried for the country(MA)

    Small business are screwed by the US tax system. They don’t have multinational tax departments or lobbyists to game the system.

  • Anonymous

    Tom,

    How about implementing a Corporate AMT tax. The government thinks it is good for individuals, so why not corporations?

  • David

    England is in revolt against corporate tax cheats
    http://onpoint.wbur.org/2011/03/29/taxes-american-corporation
    “This is Economic Treason”: 500,000 March in London Protesting Public Spending Cuts and Corporate Tax Dodgers

    Let’s go Americans.

    • nj

      Would a revolt mean missing “Dancing with the Stars”?

      • David

        Practice your dancing in the streets.

        Those people look hideous. How can you even watch it?

  • Stafford

    I note a parallel here between GE and Toyota. When these multinationals lobby Congress and regulatory agencies, there’s no limit to what the lobbyists ask for. Toyota’s lobbyists were successful in avoiding safety recalls on its vehicles, and the executives who avoided the recalls touted their success in internal emails. When it blew up in Toyota’s face, it blew up big.
    The same thing is happening now to GE. They engage in consummate lobbying and have corrupted the US tax system. However, they are very uncomfortable when it becomes public, because that’s not something they bargained for. I hope the American public realizes what’s happening and understand that corporations’ claims that taxes are too high in the US have a hollow ring to them.

  • Anonymous

    Thus the hypocracy of the Republicans when they claim to be acting in the interest of small business.

  • Kati_mitchell

    What do we think of tax reform? You must be kidding…. it is just one more of all the reforms that should be happening – election reform, campaign reform, corporate responsibility reform, corruption reform, politicians in the pockets of corporations reform, education reform, and so on and so forth….. we are at the bottom of the barrel on every front worldwide and there will never be any reforms.

  • Tina

    1) Does this mean that the SHAREHOLDERS of these companies get to make more money? How does that work?

    2) I heard that the money just SITS in overseas “boxes” instead of circulating within the U.S. How does THAT work? Can you explain the consequences in normal-person terms? Thanks!

    3) IF we had a Social-Democratic system like the Scandinavian countries, we would not have so many poor and desperate people, even so many people unable to work because they cannot afford day care for their children or their elderly parents. IF the corporate tax code gives these corporations lower rates, the REST OF US Americans should GET THE SOCIAL-DEMOCRATIC SYSTEM I JUST DESCRIBED — that should be the ONLY deal. True safety net for us, including the Scandinavian one-month vacation per person per year!

  • Mark

    Americans need to blame themselves for the tax problem.

    During the past 25 years of relatively low unemployment people didn’t care as Washington lobbyists paid politicians to create accommodating tax laws.

    Now that people are suffering in financial agony
    their apathy toward TAX LAW is over.

    But now it is too late since
    The Citizen’s United verdict in the Supreme Court has guaranteed that those laws WONT CHANGE. Corporations will gladly spend a few extra million dollars on their favorite politicians to save them BILLIONS on taxes.

  • Anonymous

    If corporations are people, why not subject them to the Alternative Minimum Tax?

  • Joe in Philly

    The unfolding of history is a fragile dynamic. No one anticipated the uprisings and armed conflicts in the Middle East and the Arab World. Can grass roots rebellions of this type occur here in the US? Perhaps not, but maybe the arrogance and hubris of Corporate America and their supporters, and the decline of the middle class will be the straw that breaks the backs of average Americans. Our society is based on the “perception” of fairness; when people realize that the playing field is not level, that will be the catalyst for change.

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Getting people to realize the problem is an uphill struggle, given that a frightening percentage of them still believe, like their culture hero, that “government IS the problem.”

      They don’t understand that Reagan was talking about them when he said “the government.”

      • Grady Lee Howard

        Nope. He was still working for GE.

    • Grady Lee Howard

      So when the corporations that run government are opportunistic government become illegitimate> Isn’t that what Egyptians were telling us? When government serves an oligarchy through corporate chichanery and neglects the well-being of the People it is no a government at all. It is a conspiracy and a dictatorship and a plutocracy.

  • GeraldFnord

    You might exist without a State, but no corporation does. You might be able to hold on to a good chunk of your small property in the State of Nature, but no artificial and very few natural persons could do.

    As such, this means that the large corporations’ wealth is particularly answerable to the requirements of the society that created them and allows them to exist, maybe not down to Ben Franklin’s “last farthing” but much more than not at all.

  • Boston mom

    It is a plutocracy. Obama and Clinton were two of the biggest deregulators. I’m nauseous every time I see how much hold the people controlling much of the country’s wealth are able to affect laws. Inside Job … great documentary. Too bad nothing changed after this hideous recession.

  • David

    U.S. Uncut is getting going.

    http://www.usuncut.org/

    Let’s show these corporate tax cheats we will not stand for this treasonous behavior.

  • Mbreer

    There is a Supreme Court case being decided as we discus this on the Arizona’s Citizens Clean Election Act. The act provides public financing to match funds raised by candidates that have close relationships with PACs and corporations. The act is being challenged on the grounds that it is a violation of candidate’s first amendment rights; in the meantime GE—and other corporations—are quite literally writing the tax laws. How can my speech compete with such special interests?

  • Ellen Dibble

    The only way to make it with corporations insisting on being internationally competitive is to make sure you have a fair share of your income deposited as young as possible into the kind of financial instruments that will bring some of those corporate profits back to you.
    It may take you 10 years to pay off student debt and build up said IRA, but at that point you can think of marriage and family and have stock dividends coming in to make up for the losses you otherwise have as an American in a cheap world.

    • Anonymous

      That’s if you’re lucky enough to have sufficient income to make those investments each month. Many people live with a vanishingly small profit margin.

      • Ellen Dibble

        I absolutely know, Greg. I just think it is the only way to approach leveling the field. I actually think that taxes on stock dividends are at a lower rate than on actual income. Certainly the FICA taxes on stock income are less. But the more I listen to the ability of corporations to put a very heavy thumb on the scale of economic justice, I think we/I are subsidizing them. Buy local, and make your own Nongeneral electricity with a solar panel, if at all possible.

        • BHA in Vermont

          There are no FICA taxes on dividends or capital gains, only on earned income. The federal (any given state may be different) tax rate on dividends is your marginal rate unless you are in the 10% and 15% brackets. Then the rate on dividends is 5% maximum (for 2010).
          Taxes on long term (1 year+) capital gains is 0 for people in the 10% and 15% brackets. All others pay 15%, even if you are Warren Buffett. That is why Warren has a lower effective tax rate than his secretary.

        • BHA in Vermont

          There are no FICA taxes on dividends or capital gains, only on earned income. The federal (any given state may be different) tax rate on dividends is your marginal rate unless you are in the 10% and 15% brackets. Then the rate on dividends is 5% maximum (for 2010).
          Taxes on long term (1 year+) capital gains is 0 for people in the 10% and 15% brackets. All others pay 15%, even if you are Warren Buffett. That is why Warren has a lower effective tax rate than his secretary.

  • Ben

    To your question Tom:
    Do corportaions avoid taxes because the rate is too high?

    If the rate was lowered to 5% they would work the system the same way if it was 50%.
    Corporations avoid taxes because they DON’T want to pay them, not because they are too high.

  • Greatwork

    I own some ge stock. It pays me a dividend. I claim that on my 1040. How does this relate to ge’s proffits and their taxation?

  • mike

    Corporations don’t pay taxes, they merely collect them……..people pay taxes

    • Anonymous

      So for your SLOW people out their asking for corporate taxes to go up, they should know that increasing the taxes on WalMart just increases they price of the products they buy at WalMart

      • Anonymous

        But what does Walmart compete with? It’s a monopoly in many areas.

      • Dave in CT

        Good thing we don’t need 80% of that crap.

      • Jim in Omaha

        As someone with an economics background, you should recognize that as “internalizing the costs”, a fundamental prerequisite to a properly functioning market economy. That is the way it is supposed to work.

        • Anonymous

          “internalizing the costs” is not a term mentioned in any economic text books I have seen or classes I have taken.

          Taxes can be looked at as a fixed cost of production with respect to unit of output or as a variable cost of production with direct correlation to amount of goods produced. Either way the tax is added with the other costs of production and then the price of the good is calculated by multiplying the cost of prduciton of the good by (1+profit margin).

          Because of this the tax is directly passed to the consumer through increased sales price. Depending on the company, the increased cost could be equal to the tax or equal to the tax + profit margin on the tax but this depends on the elasticity of the product.

      • Stanclauss

        Good point Brandstad. It’s been made here before, but from the tenor of many of the comments also made here, it bears repeating a few more times.

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Problem is that everybody pays corporate taxes now, whereas only the customers of a corporation would pay its corporate taxes in a moral system. Why should I pay GE’s taxes? GE’s customers should.

  • PJ

    Tom,
    Great topic!!
    …but let us not be naive, who really runs our country? Tax reforms will never happen. For this to happen we will have some real changesreforms in the way politics, elections, etc are conducted. This It will NEVER HAPPEN, specially because “we the people” will continue to pay for it…. but I guess it is nice to dream

  • Sharon

    Shame on your guest for ducking the most important question: What is fair? I don’t know what a fair tax rate for corporations would be, but I do think that they have a responsibility to pay something.

    Corporations reap the benefits of our education system with a well-educated work force, they enjoy the benefits of a physical and legal infrastructure that allow their businesses to function, they are protected by our armed forces, and last year the Supreme Court ruled that corporations have the same free-speech rights as individuals. If they can enjoy the rights and benefits of a society, then corporations should pony up and shoulder some of the responsibilities, and not push that onto individuals and small businesses.

    • Anonymous

      The most fair corporate tax would have only a few questions and no deductions. X% or corporate profits should be given in taxes. no other questions asked.

      This would never happen because our politicians work for the corporate interests and our lawmakers couldn’t slant the table for the corporations that are their friends.

      • Grady Lee Howard

        Here you are correct, Brandstad, as far as it goes.

    • William

      I think it would be fair for the business to pay income tax, but not unemployment insurance or workman’s comp. Those two should be left to the employee and not the employer.

      • Grady Lee Howard

        Workmans Compensation protects the employer from unlimited damage suits. It is a compromise invented by big employers. So are you saying employees should have no recourse against employers who injure them? You sound like an authoritarian extremist who thinks might makes right if that is your position.

        Unemployment benefits are a similar proposition. They began as a way of insuring idle workers would be healthy and fed and ready when an employer again needed them to resume production. Just because you don’t ride your pleasure horse for weeks does not mean it does not have to be fed, brushed, doctored and exercised in your absence. Unemployment benefits are a kind of stable charge for employers who wish to remain employers. And government supplements the programs from general tax revenues to assure the health and flexibility of the economy for the general welfare of society. I think you have mistaken employers for royalty. But maybe your mis-education is understandable in a sick society where the rich are worshiped. And too often libertarian idealogues make the error of comparing large scale (structural) situations with exchanges between peers. Are you the peer of GE? I think not. You’re probably not even a petty employer. but only a mouthpiece for your greedy “bettors”.

  • David

    http://www.democracynow.org/seo/2011/3/28/this_is_economic_treason_500_000
    “This is Economic Treason”: 500,000 March in London Protesting Public Spending Cuts and Corporate Tax Dodgers

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Yes, we need to be calling it what it is.

      “Economic treason” is a very good term for it.

      • Grady Lee Howard

        Fascism works good in the short run, the real short run. Then you get feudalism.

  • Dave in CT

    Trademarks and Patents and Upper Management, with offshore labor, will never be sustainable for US jobs, in terms of fully employing Americans.

    The obvious model is profit/salary for upper management, and drive the majority of American’s wages down to compete with the worlds poor.

    Yes its that simple.

    Only answer is an element of Nationalism, which demands a standard of living in this country.

    We don’t need Socialism, we just need clear rules, and clear values.

    • Ellen Dibble

      Right, we compete with the world’s poor. And if the corporations are very profitable because tax law has allowed them to thrive, we the Americans have to have a stake in that profit.
      In my opinion, this is why George W. Bush wanted our Social Security funds in the stock market. He wanted Americans to be personally vested in the profitability of Big Business.

      • BHA in Vermont

        I thought it was because he wanted the poor and middle class to lose their safety net.

        The rule of investing in the stock market is: Don’t put anything in that you can’t afford to LOSE. NO Social Security money should be in the stock market.

        • Ellen Dibble

          Agreed. I think the press TOLD us that the idea was to risk the safety net. I thought “they” didn’t want us to understand that the only way American could cut a profitable path into a free-trade planet was to foster corporatism at the expense of the Little Guy.

      • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

        Wall St. calls the average investors’ contributions to its criminal enterprise “dumb money.”

        You can ascribe whatever feel-good crap to that fact that makes you continue to be able to sleep at night; but the fact remains that THE PEOPLE ARE THE GOVERNMENT and we’re owned outright by these corporate “persons”. It’s past time to take this system apart.

        • Ellen Dibble

          No, the status quo is not contributing to my good night’s sleep. I am pushing as hard as I can with my retirement funds to make them answerable to what I’ll call the new economy. I want me and all like-minded individuals to be able to EASILY get their savings into the non-oil, renewable, sustainable, innovative, upstart, challenging-the-Big-Corporations economy. I do not mean “socially responsible” as not involved in alcohol, not involved in defense research. I mean, let us dumb investors start to define Responsible Investing such that it is not outsourcing the future of those who follow.

      • julie rohwein

        I think Bush wanted to move SS into the stock market so that various Wall Street houses could profit from the big influx of money to be invested for relatively small and unsophisticated investors.

  • BHA in Vermont

    This is not at all surprising. The more money an entity (person or company) has, the more money they spend trying to avoid paying taxes either by getting the laws changed in their favor or finding legal loopholes.

    Given the tens of MILLIONS they spend to do this, it is clear the ‘saved’ money is much more or they wouldn’t bother. Which is why we need to change the tax laws – no deductions, tiered tax rates that are LOW.

    Of course, this would be a ‘job killing’ concept. All the people who work every day to find these loopholes or change the laws would have to get a job that produces something of value.

  • Dave in CT

    Until the “globe” is an equal playing field in terms of democracy, human rights, economic choices/philosophy, choices in work ethic and self-governance etc, we should not be ashamed of an element of “protectionism” or Nationalism, rewarding Americans for the choices, economic philosophy and values WE have chosen, sacrificed for, and should be rewarded for.

    Today, upper management is stealing ALL the benefits of the collective choices we have made in the American experiment.

    The Globalization scam is what makes it possible.

    I still believe in Liberty principles, but that doesn’t mean I have to accept the false “free trade” or “open markets” we are led to think there is.

    • Anonymous

      There’s a good side to globalization and a bad side. If it’s done correctly, it will bring economic development to every country. The problem is in the way that the treaties are being written in favor of large entities, rather than the people of the nations.

      • Dave in CT

        Lets focus on that.

        I do believe that when the US, for all its warts and abuses, has chosen a liberty-centric, free-market, work hard, play hard, be as self-sufficient as possible, and enjoy the fruits of your labor philosophy and most people value and love that.

        That said, we cannot fairly compete against societies who have not made those same choices and sacrifices. Americans DO deserve a better standard of living due to the philosophy, education, hard work and sacrifices we have chosen. Multinationals sprang out of that system, and are now burning through its foundations for their own short term profit.

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      “Today, upper management is stealing ALL the benefits of the collective choices we have made in the American experiment.”

      Or, to reduce it even further, they’re stealing…no, they’ve stolen America.

  • Jason-Nashville

    Tax reform = Get rid of W-2! Everyone write a check every quarter. Being self-employeed has opened my eyes!

    • Anonymous

      Good idea but it will never happen because there would be a revolution. The progressive democrats might loose much of their supporters when they see the bill for their poor spending priorities.

  • David

    The truth is they don’t pay taxes on what they make in the United States. THEY ARE CRIMINALS.

    • William

      Can we say the same about the 45 percent of Americans that don’t pay any federal income tax too?

  • Lpierson3

    big corporations show no patriotism in paying their fair share and the republican and democratic parties are the biggest supporter and enablers of this. Does that therefore mean that our politician lack patriotism?

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Yes.

    • Jim in Omaha

      Anyone, politician or otherwise, who simultaneously proclaimed “support the troops” and “reduce my taxes”, was and is unpatriotic.

    • Jim in Omaha

      Anyone, politician or otherwise, who simultaneously proclaimed “support the troops” and “reduce my taxes”, was and is unpatriotic.

  • David

    GE got 14 billion in bailouts from the US taxpayers!!!!!!!!!!!!!!!!!!!!

  • Dave in CT

    Listen to this BS. Corporations didn’t take hits in the crash. They got bailed out. GIVE US A BREAK!

  • Ellen Dibble

    I believe Hines is the one saying firms can not only NOT pay taxes on foreign profits that corporations pay taxes for overseas; he is saying (now twice) that those taxes paid overseas can be DEDUCTED from taxes owed here. Isn’t that double dipping? No wonder they end up owing zero.

  • http://reinventing-america.blogspot.com/ ulTRAX

    What is a killer idea worth in an impoverished 3ed or 4th world nation where there are no legal, monetary, patent, educational, physical, public health, law enforcement infrastructures to exploit it?

    Probably nothing.

    If there is a moral basis for the rich and corporations paying more in taxes it’s because they use more of the public infrastructure than the average guy. IT’S THAT INFRASTRUCTURE THAT MAKES THEIR WEALTH AND HIGH PROFITS POSSIBLE.

    For that reason I think the Personal Income and Corporate Income taxes should be renamed the “Opportunity Tax”.

  • http://www.gchfineart.com GCH

    “Competition” is the right word, but it’s not the competition of corporations against each other, instead it’s competition between corporations on one side and citizens on the other– and citizens are getting pounded. Corporations have the big guns– governments, lawmakers– on their side.

    • Ryan H

      How do you think it’s competition between corporations and citizens? Is someone forcing citizens to buy there products? No, give me a break. You are listening to too much left wing propaganda.

      • Anonymous

        Walmart is now just about the only grocery store in my area. That means that the company can charge what it likes and sell only what it likes.

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      Don’t forget the military. The number one use of the military over the last, well, decade, now, is the protection and expansion of America’s economic interests.

  • Tina

    Workers who agreed to a lower wage or salary during the Economic Downturn — did THEY get to count that lower income “as a loss”?

    Did the laid-off workers who lost their jobs because their jobs were taken Overseas, once THEY get new jobs at minimum wage, did THEY get to count that lower income “as a loss”?!!

    This country is a Sick Puppy!

    • David

      No. Nor did the average person get any money from the U.S. Government, ie the American taxpayer.

      Some got unemployment. But that ran out. And there are still 22+ million people who can not get a job because there aren’t any.

      Or, employers hire illegal immigrants or H1-B visa holders rather than Americans.

  • claude

    If GE was getting such a break, how come their stock is down 50% in the last 4 yearsl

    Claude in toronto

    • David

      Because they only exist because of government hand outs.

      GE designed the Fukushima nuclear plant btw.

      • BHA in Vermont

        Which has NOTHING to do with this dicussion.

        • David

          Shows the quality of the products they sell. Crap.

          • Anonymous

            Not really. The reactor in question is an old model. That’s like calling Ford products crap because the company once sold the Pinto.

          • Anonymous

            How many Pintos are still on the road? Reactors from this era are still operating.

          • Anonymous

            To be sure, but the point was that the product being criticized is an old model, so not relevant to present-day production.

          • BHA in Vermont

            The reactors were designed to run 40+ years, the Pinto was designed to run (maybe) 4+ years. No surprise there are few still on the road.

          • Ryan H

            Ford is crap!

          • David

            When the GE design is the one in current meltdown I think it is relevant.

            How many Pintos are still on the road?

          • Anonymous

            Again, it’s an old design. GE, et al., have come up with much better in the years since.

          • David

            Yeah! 3 cheers for not looking backwards.

            Watch this documentary on Chernobyl and get back to me whether you trust GE to build safe nuclear plants that will never have an accident.
            http://www.youtube.com/watch?feature=player_embedded&v=yiCXb1Nhd1o#at=1719

          • BHA in Vermont

            I agree when it comes to Microwaves ;) The quality of GE home appliances has gone down the toilet. My TWENTY FIVE year old GE dishwasher still works just fine and I have never had to repair it. On the other hand, I bought a GE counter top microwave in March 2009. It died in April 2010. 1 year warranty indeed, almost as if the microwave had a warranty clock built in.

            The Sharp we got in 1990 lasted 15 years, its replacement (I *think* also a Sharp) lasted 4 years. There is no longer a microwave in my house. I refuse to throw money down a rat hole.

          • David

            I have a 25 year old Sharp microwave still going strong.

      • William

        The reactor did not fail.

    • Anonymous

      Claude, their stock is not down 50% in the last four years, they are down about 25%. I don’t know if you have noticed but we are in a recession. This has a large effect on the values of businesses since sales and profits are decreased due to economic conditions.

      • ThresherK

        This has a large effect on the values of businesses since sales and profits are decreased due to economic conditions.

        Corporate profits have not recovered, by and large, from the recession? Cite, please.

    • Anonymous

      Well, the tax breaks don’t affect the basic business. Their stock may be down 50% because of lowered profits or reduced sales or whatever.

  • Mohlenkamp

    As long as large multi-national corporations can contribute unlimited funds to political campaigns and be involved in any way with writing the tax codes, there will NEVER be a fair system.

    What about trying a no-write-off AMT for corporations, like we do for individuals? So, at least GE and others pay a minimum of 5~10%? Or, not allow any subsidy payments to Exxon if they don’t pay any taxes?

  • Dave in CT

    Taxes, Inflation, IRA losses, property loss, unemployment are for the masses.

    The elite in government and banking have been pulling the strings and corrupting the free market for generations.

    Its not Capitalism vs Socialism, its Accountability vs. Corrupt State Capitalism.

    Punish corrupt politicians and corporatists for once. For ONCE!

  • Mary

    Two words…antitrust laws. What ever happened to these? The behemoth known as GE has developed many arms of its corporation, and enough of these arms are off shore that they do not have to pay US taxes. Privatization, of GE, by GE, and for GE. These corporate humans are going to privatize our government before long.

    • mayflowertwin21

      The antitrust laws that used to control the abuses of power so easily utilized by corporations started to decline under the Presidency of Ronald Reagan. And sadly the Democrats caved…

  • Shreddnyogi

    Ironic that Egypt, Lybia, Sudan, and other countries are rising up against govt. oppression with support from the U.S. government while the citizens of the U.S. are left out in the cold, vis a vis any connection to their “own” government—read corporate plutocracy.
    Strange times we live in, when the average Joe here in the U.S. either unemployed, or underemployed, watches news clips of freedom fighters overseas with a tinge of jealousy.

    • David

      Don’t worry. The time is coming. Unemployment and homelessness and no future are powerful motivators.

      • Shreddnyogi

        I’m with you!
        Another irony is the insidious nature of this forum!
        What it amounts to is public masturbation.
        People’s anger and emotions in effect are given “virtual” meaning here, and they go about their business afterwards thinking they’ve done some “meaningful” deed.
        Really?
        hmmm……………..

    • Alan Shulman, NH

      I’m waiting for a specific proposal.

      • Shreddnyogi

        Take to the streets here as they’re doing over there.
        A “revolution” is what is needed.
        Force a general strike to shut down the corporate plutocracy.
        Nothing short of mass protests will effect the level of change that is needed.
        Use the internet to link all factions creatively involved while simultaneously redrawing a new constitution FOR, OF, AND BY THE PEOPLE

  • Dave in CT

    By all means quibble!!!

    • Fredlinskip

      I assume you’re referring to the statement I think James made,
      “You can quibble about how much corps (GE?) pays, but….”

  • Joe in Philly

    Auditing as a means of ensuring compliance (discussed by the caller), as we know from Enron/Accenture exercise, is a farce. Why not have accounting firms have a fiduciary responsibility to report tax evaders and corporate improprieties? Presumably they can do this under the Whistleblower Protection Act but choose not to?

  • Joe in Philly

    Auditing as a means of ensuring compliance (discussed by the caller), as we know from Enron/Accenture exercise, is a farce. Why not have accounting firms have a fiduciary responsibility to report tax evaders and corporate improprieties? Presumably they can do this under the Whistleblower Protection Act but choose not to?

  • Ron in Lower SC

    When we discuss paying ” fair share ” , why am I at 55 y/o with no children , never married paying 27 % tax on a gross salary of 32K p/y , how about all of you with 3 – 10 kids + pay YOUR fair share !!!!!!!

    • Worried for the country(MA)

      At least you are not paying the marriage penalty.

    • BHA in Vermont

      Not that I necessarily disagree with you, but be happy with how much you have to spend on *you* :)

      Kids cost a LOT more per year than the difference between their parents’ tax and the tax paid by someone with equivalent income and no kids.

  • R Stone Assoc

    Tom Ashbrook rocks!! 3 Cheers to Mr. Ashbrook for covering this issue. When the microphones are on, the line is always the same — “Everyone should pay their fair share of taxes.” When no one is there to listen except for the lobbyist and elected official, whispers over cocktails, “our ‘fair share’ just happens to be ZERO.” Hey NPR, why not re-run this Taxes and the American Corporation show during morning and afternoon rush hours?

    • William

      Except, I wish he would have discussed the similar problem with 45 percent of Americans that don’t pay any federal income tax too.

      • Glen B

        The way I see it, the only taxes that conservatives like are the ones applied to those with low incomes — they make up the majority of those you mention who pay no federal income taxes. Of course, they still pay SSI and Medicare payroll taxes, sales taxes, gas taxes, property taxes…

        If GE paid its proper share (i.e. something other than zero and probably something approaching the top rate), that would likely make up for all those 45% you mention.

        • William

          The only taxes liberals like are all of them, except for those that use the services the most and don’t pay anything. The low income people are well taken care of in this country. Section 8, Earned Income Credit, food stamps, WIC, Head Start, Medicaid, free school lunch, and sometimes breakfast and dinner. I find it not unreasonable to start a negative income tax to try and break this cycle of dependence.

          GE figured out how to pay no federal income tax, but I think they pay a huge social security tax, unemployment insurance, workman’s comp., property taxes, taxes on dividends, state and local taxes.

          • Cory

            I think the poor pay plenty of taxes if you THINK about it. Let’s start with sales tax…

      • Jim in Omaha

        Yes, they should do a show on the huge underclass that has developed in the US over the past 3 decades.

        • Cory

          Jim, I’d like to buy you a lager of your choosing.

  • Boggs

    Clearly, James Hines is a lunatic.

  • David

    Obama is telling you exactly what he thinks of you American workers when he hires Geoffrey Immelt, job off-shorer extraordinaire, to be the job czar. He is laughing that your jobs are being shipped overseas and wants to speed up the process.

  • RLS

    David Cay Johnston is a columnist for Tax.com and the author of “Free Lunch: How the Wealthiest Americans Enrich Themselves at Government Expense (and Stick You with the Bill).” From his interview with Democracy Now:

    “There’s something called the Shelf Project, done by a number of professors who have dug into the tax code very deeply, and they’ve shown that without raising rates, government could bring in a trillion dollars a year—that’s as much as the income tax brought in 2008—A TRILLION DOLLARS, by simply taking away loopholes for corporations.”

    • BHA in Vermont

      Yes, but closing loopholes will be seen as raising taxes. Of course that is because it would … until the lawyers, accountants and lobbyists find yet another way around the wall. And they will as long as there are deductions and special cases written into the US Tax laws.

  • Steve in Cedar Falls, IA

    They promised no raise of taxes on the middle class and even voted to keep the tax cuts for the wealthy, yet my federal withholding went up 11% starting this January. And corporations are are playing little to nothing? Where’s the fairness?

  • Ellen Dibble

    It seems to me that there are profits to be made overseas due to (a) growing markets and (b) cheaper labor. Those profits pretty much mean all jobs nonrelated to what happens here and now will go offshore, or else corporations can’t rake in those possible vast profits.
    How does a citizen survive? We have to have a share of those profits, it seems to me, either mediated by the government (collecting more taxes from the corporations, who are thereby weakened) who then provides more services, becomes “big government,” in other words, OR we have stocks and participate directly in the profits like that.
    Straight competing with a $1,000/a-year person from (fill in the blank), we have our hands full. Are you tougher and smarter than your normal, say, Egyptian? Nope.

  • Dave in CT

    What do we REALLY need to feed and house all of us?

    Is all this demand for productivity and competition really for our own good or to continue to feed skyrocketing CEO salaries and campaign contributions?

    • http://www.facebook.com/tzbauknight Trevor Zion Bauknight

      You could wait around for a nice General Electric refrigerator box to live in.

    • Dave in CT

      and I mean false “competition”, as asking honest hard-working Americans who have bought into the work-hard, be smart, be free model, are now having the benefits of that choice sucked to the elite within a generation, and told they are no better than the rest of the worlds poor laborers who for whatever reasons and repressions, have not built such a culture.

      We should only compete with “like” cultures, it is the only fair thing. Let other countries & cultures go through their revolutions, self-government establishment, rule-of-law establishment, education building, etc,, and then have them join the free market of the truly free.

      Making us compete against repressed, non-free market, etc. peoples is a scam by the corporate elite and politicians do NOT want to compete by the rule of law in a true world of Liberty, they want corrupt short cuts and pirate profits.

    • Lpierson3

      it’s called afluenza we are sold so many things we do not need and so many things we need to protect ourselves I don’t buy its what consumers want but rather what they want us to buy to keep the profits a small house to live in enough to eat enough to keep warm what else? the other sad part is most is sold based on fear of life and fear of each other

      • Ellen Dibble

        I think the afluenza has passed, and the corporate powers who were trying to sell to us gave up and started to sell to India and China and other emerging markets. Apparently even selling products that break or get superseded by newer and better gizmos only helped for a certain span. After that, the low-paid employees the corporations had been paying in India/China/etc began to catch the afluenza and cook our planet for us. We can start to be holier-than-thou and tell them to stop consuming, disposing, degrading the planet. Our turn for the moral high ground, I think.

  • mayflowertwin21

    How much of GE’s gross receipts are derived from governmental payments — oh wait from the US taxpayers–what a scam.

  • http://www.facebook.com/jonvaage Jon Vaage

    We have to lower our tax rates so companies don’t abandon the USA?? sounds like don’t upset the feudal lords or they’ll outsource us into submission.

    • David

      It’s called blackmail.

      These treasonous CEOs and their companies can go.

      STOP BUYING THEIR PRODUCTS. DEMAND THE GOVERNMENT DO THE SAME.

      We’ll start our own companies that are law abiding.

      • Anonymous

        No, it’s not called black mail. It’s called international competition.

        Countries that are more socialist than the U.S. have lower corporate tax rates (like Canada). Lower our corporate tax rates and bring the U.S. jobs!

        • http://www.facebook.com/jonvaage Jon Vaage

          Our corporate tax rate is a farce. If it was a flat corporate tax w/o loop holes, then yeah, we’d look pretty bad, but that rate seems to be the exception and not the rule.

  • R Stone Assoc

    Do antitrust laws still exist?? Consolidation, consolidation everywhere — even in the MEDIA (Print, TV, MOVIES). It is known by very few that 5 mega corporations OWN & CONTROL more than 75% of the western World’s media. These mega corporations sell ads to other mega corporations. Check out: http://www.freepress.net/Ownership and
    http://www.cjr.org/resources/

  • Heather in Boston

    If anyone is interested, their is a growing movement to help bring attention to this issue called US Uncut. They organize peaceful demonstrations all over the country (most notably at Bank of America branches at this time, but they are expanding).

    Here is a quote from their website.
    “US Uncut is a grassroots movement taking direct action against corporate tax cheats and unnecessary and unfair public service cuts across the U.S. Washington’s proposed budget for the coming year sends a clear message: The wrath of budget cuts will fall upon the shoulders of hard-working Americans. That’s unacceptable.” – http://www.usuncut.org

  • ThresherK

    Looking forward to the podcast.

    I wonder how many other listeners remember the incident in the last decade where George W. Bush all but said “Those corporate tax lawyers are too gosh darn smart for us” when it comes to the screwed up tax execptions.

    That was the sound of a man who gave up trying and a party that simply doesn’t believe in governance. Republicans, are you all with him?

    • William

      I don’t see much protest from Obama or his majority in the Senate the last few years.

      • Cory

        At least lefty politicians pretend.

  • ThresherK

    Looking forward to the podcast.

    I wonder how many other listeners remember the incident in the last decade where George W. Bush all but said “Those corporate tax lawyers are too gosh darn smart for us” when it comes to the screwed up tax execptions.

    That was the sound of a man who gave up trying and a party that simply doesn’t believe in governance. Republicans, are you all with him?

  • RLS

    “March Madness for Corporate Tax Dodgers
    Top Seeds in the Tax Haven Tourney: Banks and Power Companies”
    http://www.commondreams.org/view/2011/03/21

    On the list of the top 16 tax dodgers: General Electric … Bank of America … Exxon … Citigroup … Wells Fargo … Hewlett Packard … Verizon … Chevron … Boeing … Amazon … Carnival Cruise Lines … Koch Industries … Rupert Murdoch’s Newscorp … Google … Merck … Pfizer

    “Who’s projected for the Final Frauding Four?

    “Best Defense: Google uses a game plan called a ‘Double Irish Defense,’ which moves most of its foreign profits through Ireland and the Netherlands to Bermuda.

    “Best Offense: GE’s 2010 SEC 10-K tax filing boldly states: ‘At December 31, 2010, $94 billion of earnings have been indefinitely reinvested outside the United States…we do not intend to repatriate these earnings..’

    “Most Steals: Citigroup: 427 tax haven subsidiaries

    “Best Trash talk: A General Electric spokeswoman: ‘G.E. pays many other taxes including payroll taxes on the wages of our employees, property taxes, sales and use and value added taxes.’

    “Most game-ending bailouts: Bank of America received $45 Billion in tax payer bailout funds in 2008 and 2009. In 2009 the company earned a pretax income of $4.4 billion, but claimed a $1.9 Billion tax benefit from the government.

    “Teams with the most reserves:
    General Electric: $77 billion
    Google: $24 billion
    That’s 2 companies holding $101 billion that could be invested in jobs.

    “Tax Haven Tourney Champion? GE is the Duke of Tax Avoidance.”

  • Fredlinskip

    What about the fact that corp execs make 100, 400, up to 1000x average American worker. Wouldn’t it make more sense if perhaps a CEO or exec made oh say, 30 or 40 times average worker and they used the rest to hire 700 or 800 more employees and have those employees work on such things such as R&D, so we actually have a chance of staying ahead of other countries? In other parts of world the balance of wages between execs and employees, is nowhere near as imbalanced as ours. That’s partly why other countries are catching up and surpassing in many areas.
    I’d be ashamed if I was part of corporate culture laying off workers so I can give ungodly bonuses to execs. That’s not the “American dream” I believe in.

    To me the great hypocrisy of today is complaining about deficits, then extending tax breaks for wealthy and corporations when it is common knowledge that these folks are already sitting on unprecedented amount of capital- somehow claiming this will increase jobs and “revenue” (even though CBO determined this is the least effective way to promote job growth). Then turning around and cutting programs to do with infrastructure (ours currently ranks 27th in world), education, alternative energy, and research: while other countries are making large investments in these same areas; and then wonder, “gee, why do we seem to be losing ground to other nations?”

    Funnel more $ to wealthy and they are gonna get richer. They’re also gonna use that $ to influence elections and to best of their ability try and get people to believe if we just allow them to have more $ yet we are all gonna be better off. You’d think people might catch on that doesn’t make a lot of sense- but apparently they’re pulling it off pretty well. I guess maybe it all comes down to the adage, “$ talks, ____ walks”. I’m not saying that by default all wealthy and corps are “evil ones”- but many of them are going to “game the system” the best they can- that being partly how many achieved their wealth in first place.
    Look at administrations of the past. During whose administrations did the middle class fare the best, America was most respected around the world, infrastructure, etc. received most attention? What were the policies in place at those times?
    Reagan eventually raised taxes. Bush 1 called “trickle-down” “Voodoo economics”. Cheney claimed “Reagan proved deficits don’t matter”.

  • http://www.facebook.com/tekelg2 Tekel Gayle

    I think GE’s and actions other company should fall under the view of the anti-corruption laws rather than anti-trust laws.

    What is the difference of a company going into a foreign country with a suitcase of money to win a contract of change a rule which is favor of the company doing business?

    Here in the US lobbyist carry these suitcases of money in the form of campaign money, donations to a constituents in their home district or better yet a very lucrative job after a government employee leaves government.

    Is lobbying the form of corruption which is legalized? If so, is it not still corruption?

    I believe the Supreme Court recently weakened portions of the anti-corruption laws. The same court which allowed companies unfettered access to provide money to political campaigns.

    Last, I think as individual or a company making profits here in the US, it should be taxed here first and not allowed to be shuffled around the world to avoid taxes. Hey, this sounds like money laundering which is yet another federal offense which companies found a way to legalize it for themselves.

    White collar crime is still a crime. “Lying, cheating, and stealing.
    That’s white-collar crime in a nutshell. The term—reportedly coined in 1939—is now synonymous with the full range of frauds committed by business and government professionals.

    It’s not a victimless crime. A single scam can destroy a company, devastate families by wiping out their life savings, or cost investors billions of dollars (or even all three, as in the Enron case). Today’s fraud schemes are more sophisticated than ever, and we are dedicated to using our skills to track down the culprits and stop scams before they start.” (http://www.fbi.gov/about-us/investigate/white_collar/whitecollarcrime)

  • Anthony

    Dr. Seus, drew a political cartoon about fat cat’s crawling through the ways & means loop hools where Average Joe has to go through the IRS turnstile. This is American politics and American business/culture, and has been for a very long time.

  • Mark

    This is what happens when we let the corporation become a person!! The decline of America!!!!

  • Alex

    It is shows like this that will get NPR defunded more than anything else.

    • Fredlinskip

      You’re probably right,
      because as Nicholson said, ‘They’ “….can’t handle the truth”.

  • Alex

    It is shows like this that will get NPR defunded more than anything else.

  • Rachel

    So it seems to be about math. Pay a team of tax lawyers to rewrite the tax codes and it costs less to pay the lawyers than it does to pay the taxes. So basically they get to bankrupt America and if things get too bad here, they have the money to go live somewhere else.

    If you are a small company or self-employed individual, you cannot hire a team of lawyers so you are stuck paying what the corporations aren’t. It’s got to come from somewhere.

  • Cindy

    So why did he put the fox in charge of the hen house?

  • http://www.facebook.com/jonvaage Jon Vaage

    Thanks to advancements in engineering, products are able to be designed cheaper at an arguable cost to longevity. A company will decide how long they want a product to last, what ammount of abuse, wear and tear it should withstand and then exactingly build it to meet that performance level (with factors of safety) and no more. Its simply engineered obsolescence. They know there is a better chance a consumer will come back to them to replace their product once it breaks down in contrast to a new customer picking them from the whole lot so they’ll only make a product last long enough to avoid a significant consumer backlash

    • Cory

      Sounds like a good business model to me.

  • Alex

    I was hit by AMT last year. What’s good for me should be good for GE.

  • Michele

    This is not just an issue of large multi-nationals dodging their fiduciary duty to the US vs. the individual tax payer. There are numerous small and medium-sized businesses who pay outrageous amounts of taxes without the benefit of off-shore accounts and shell corporations overseas. The larger companies are vampires living off of smaller companies and sucking money out of the treasury in the form of tax credits. Lobbyists run this country – the real corporate shills are in Congress.

  • Stanclauss

    I won’t be here to hear ONPOINT live today as you discuss corporate evasion of income tax, but I will comment that I expect your conversation to be devoted on how more corporate tax can be extracted. You will ignore the fact that many of us believe the corporate tax is actually a tax on the lowliest of consumers, inasmuch as tax is a cost, and all costs must be passed on to the consumer. Corporate profits are already and legitametely taxed on distributed dividends. So why then should a corporation be so determined to avoid them? Because without that cost they can compete better via low cost. Without corporate taxation American corporations could compete better worldwide, thus also creating more jobs in America. For some reason you or your guests, and your listeners, can’t quite see this. I think you are all quite wrong. Nor am I an interested spokesman for corporations. I am low income and elderly.

    • Anonymous

      I agree completely. Even Canada taxes their corporations less! I think we should tax corporations less but offer fewer loopholes (which tend to only benefit big businesses not little ones). If we taxed less than Ireland, Singapore, or our “uber-capitalist” neighbors to the north (ha!) we’d draw more big businesses to our shores, get more corporate taxes, AND get to tax the earnings of their employees.

      Seems win-win-win to me.

      • Cory

        It would also help to pay American employees less, eliminate benefits, cut workplace safety measures and environmental regulations. This would all make American corporations very competitive worldwide. What would the benefit of all this be to 75 percent of Americans.

        • Anonymous

          Actually, I’d like to protect those things. Ireland, Singapore and Canada all have these things and lower tax rates.

          I’d like to see the tax code changed so there can be more jobs for American workers. If we lower the tax rates (but remove loopholes) more international corporations would choose to pay their corporate taxes here in the U.S. (It’s not that they’re not paying corporate taxes, in many instances it’s just that they’re paying them someplace else *Google*cough*Ireland*cough*).

          Lower tax rates would decrease the incentive to cheat too.

  • n8ma26

    This player is awful. Onpoint used to work for me much better when there was an option to use Windows Media Player. This one always cuts out and gets sent back to the beginning.

  • ChristianB

    I recently heard a GOP congressmen talk ending the IRS and getting rid of the personal income tax. With corporations avoiding taxes and no income tax how will government support itself? Or do they expect/want the government to go back to the1800′s?

    I think the entire tax structure needs to be reorganized, a normal individual shouldn’t need a countless hours or professional help to do their taxes and corporations shouldn’t be able to escape their responsibility.

    We must lower the rates but close these loop holes to provide a moderate net increase in revenue but save us all tons of time.

    • Anonymous

      This sounds like a consumption tax that is added on to the price the consumer pays when purchasing anything and everything. It can work, and is more transparent, but implementing the tax can be tricky because it might allow a tree to be taxed when it is sold to the lumber mill, the 2×4 to be taxed when it is sold to the distributor, the 2×4 to be taxed again when it is sold to the retailer, and yet again when it is sold to the contractor, and again when the contractor finishes the work on a house. Because of this a 5% consumption tax can be far higher than the consumer knows if the government taxes each step in the process.

      • http://www.facebook.com/jonvaage Jon Vaage

        This would seem to me to create an advantage for larger firms that control more of the supply, production and distribution ends of the industry. Is this what we want? Greater efficiency at the cost of competition from smaller firms? What would be wrong with simply having an across the board individual income tax (regardless if it’s payroll, investment dividends, inheritance, etc.) and a tax on goods and services from foreign sources (aka money flowing out of the US).

      • Stanclauss

        Brandstad,
        The Euroopean Value Added Tax (VAT) works sort of like you describe. Except that the fixed tax rate is applied only to the “value added”. Thus when the end user finally purchases his house to live in, he still has only paid 5% on the total exclusive cost. Sounds like an accounting headache to me!

        HR25, the “Fair Tax” is not at all like that. The tax, probably 30%, is imposed only on the end user. And then only on the first purchase on any given item. If you buy a used car, a home from an existing dweller, or shop at Goodwill – no tax. This gives it tremendous appeal to someone like myself, always haunting the 2nd hand stores, and never having bought a new car. We still pay full sales tax on food and services, since these items are rarely satisfactory or available 2nd hand.

        But, recognizing that the poor among us spend our entire incomes on food, clothing, health care and shelter, the Fair Tax provides a monthly prebate to cover those costs at poverty level. To all SSN householders, not just the poor. So what would be a 30% tax otherwise is then zero tax.

        • Anonymous

          I like the fair tax primarily because it makes things simpler and requires less wasted man hours every year by every taxpayer and government official in order to comply with the rules and calculate your tax load. It also taxes income gained illegally and puts the collection into the hands of business and not individuals.

    • Stanclauss

      ChristianB-
      I don’t know who the congressman was but I’m sure he did not intend to do away with financial support for the federal government. He may have been a supporter of HR25, the “Fair Tax”. This measure would replace all income taxes with a consumption tax at the end-user level. The tax rate would have to be high enough to accomplish this. The last time I looked, income taxes raked off about 23% of incomes. Or, if calculated as a percentage what we have left after paying our income taxes, 30%. The Fair Tax says nothing about how the government should spend our tax dollars, except that all expenses would be so met, even entitlements, such as medicaid and social security. This is because payroll taxes (FICA etc) are also eliminated.

      So you see, not only does the Fair Tax save tons of time – it saves tons of money. Hundreds of billions of dollars are spent each year in calculating and collecting income taxes. And in searching for loopholes, and in hiring lobbyist to teach congress how to create loopholes. This is a staggering nonproductive cost. The Fair Tax relieves you and me, taxpayers, of the dreaded task of tax planning, income classification, deadline meeting, and, in many cases, the despair of ruin when a taxpayer learns he has made a taxable transaction and already spent the money. The Fair Tax makes April 15 “just another spring day”.

  • guest

    Could not hear the whole program. It kept cutting out. First part was very interesting. Will you post transcript?

  • Aa

    I typically listen to the shows after they air, and ever since the new player was implemented, I haven’t been able to make it through an episode without encountering playback problems. Love the show, just want to listen. (Also, no email address on the Contact Us page?)

  • Tyrone M Jackson

    The real issue is that too high tax rates then create greater pressure by special interest groups or corporation to make loop holes in the rates. Once those loop holes are opened, then the pressure is to push as much money through them as possible. Both the too high tax rates and the loop holes create perverse incentives that distort the economy. The correct approach is to lower tax rates to a fair and sensible level and eliminate all loop holes.

    • Michael

      What’s to stop those companies doing the same thing if taxes were lowered? Would it not be logical for those same companies to Exploit or create new loop holes even if the rates are considered fair or sensible.

      Who do you think will actually close such loop holes? Republicans? Democrats? both? and why would companies not fight tooth and nail to keep such loop holes?

  • Michael

    To Ryan,

    The Fair tax is a regressive tax, that raising taxes on people making 30k to 200k and greatly decreases taxes on the rich, not to mention for it not to lose money for the government it would be in the 30 to 40%. This is before exceptions that will of course be made to it.

    factcheck explain why the fair tax is anything but.
    factcheck org /taxes/unspinning_the_fairtax.html

    It is the parenthetical that is important, for it hides the real truth of the tax rate.

    First consider the way in which sales tax is normally figured. A consumer good that carries a $100 price tag might be subject to a 5 percent sales tax. That means that the final bill for the item is $105. The 5 percent figure is the amount of tax that is charged on the original purchase price. But now suppose that instead of pricing the item at $100, the shop owner simply priced the item at $105, then sent $5 directly to the state. The $105 price would be a tax-inclusive sales price. But $5 is just 4.8 percent of $105. That 4.8 percent number, however, is relatively meaningless. You are still paying exactly the same 5 percent tax on the item.

    The 23 percent number in H.R. 25 is the equivalent of the 4.8 percent in the previous example. To calculate the real rate of the sales tax, we have to determine the original purchase price of an item. We can begin with the same $100 item, keeping in mind that a price tag that reads $100 has sales tax already built in. If our tax rate is 23 percent of the tax-inclusive sales price, then of the $100 final price, $23 of those dollars will be for taxes, meaning that the original pre-tax price of the item is $77. To get $23 in taxes on a $77 item, one must impose a 30 percent tax. In other words, a 23 percent sales tax on the tax-inclusive sales price is equivalent to a 30 percent tax on the actual price of the item.

    FairTax proponents object to the 30 percent number, claiming that critics use the larger number to frighten people. Americans for Fair Taxation claims that it uses the tax-inclusive number to make it easier to compare the FairTax to the income tax that it will replace (since most of us think of income tax rates on an inclusive basis). But we are not accustomed to thinking of sales taxes inclusively. The result is that many FairTax supporters (about 15 percent of those who wrote to us, for example) do not understand that the 23 percent figure is tax inclusive.

    • Stanclauss

      Michael,
      I am a Fair Tax supporter. I don’t object at all to the use of the 30% figure. I don’t care what it is. The rate must be whatever it has to be in order to replace the income tax. This is what is meant by “revenue neutrality”. I may object to certain federal expenditures, but if it’s going to be spent, obviously the taxpayer has to provide the money, unless the Chinese are willing to continue their generosity.

      So, inclusive/exclusive, 23%/30%, it’s all irrelevant. The point is the money must be raised. Should it be an income tax or a consumption tax?

      The trouble with a consumption tax is that it is regressive, on its face. The Fair Tax neutralizes this in a way that makes it actually less regressive than the income tax. It does this by distributing a prebate to all SSN registered heads of household, based on poverty levels. Thus a housholder at the poverty level pays no net tax at all. Bill Gates gets back only what he and Mrs. Gates have paid to keep body and soul together.

      The trouble with the income tax is infamously known to all. I costs the economy hundreds of billions of dollars per year in compliance costs. It motivates corporations to move offshore, costing the government revenue and the rest of us jobs. It allows free rides to those making a living underground, and to illegal immigrants. It makes liars out of some of us. The concept of an income tax is so alien to objective governance that it was illegal in the US Constitution. It took the 16th Amendment to enable it. There can be little doubt that the engineers of the 16th Amendment would fall on their swords if they could have seen where the income tax would lead in less than 100 years.

  • Michael

    Also,

    since we are trying to follow the european model on Corp taxes can we follow there health care models?

    • Zing

      No. You and the mouse in your pocket do not constitute a compelling constituency.

      • Cory

        I suggest “Zing’s” comment be deleted as an off topic, ad hominem attack.

  • Jsomerville88

    Hi Tom;
    All of the developed countries [EU, Canada, US, Australia, NZ etc.] need to act on this, and unilaterally impose a tax on goods coming from ‘developing’ countries. The grand gesture of ‘Global Free Trade’ has done little but line the pockets of large corporations. If something is made in a county where the standard of living is so low that ‘onshore’ manufacturers can’t compete, there needs to be an equalization tax.. Offshore Manufacture tax applied. Offshore phone centres should also pay an equalization tax. This tax should in part be routed to new onshore industry.
    This shouldn’t apply to food goods, or goods that we bought previous to the globalization from offshore sources.
    Global free trade in the beginning was like putting a cup of milk into a gallon of water, as far as leveling the world economy goes.. milk being the rich countries.. the end product will be more similar to water, as the global economy will find an average more similar to that in the undeveloped countries prior to freeing up trade.
    And this is not at all a good thing for citizens in the richer countries in the world.
    In fact, what has happened is a lot worse than this; instead of an averaging out of economies, the wealthy corporations of the world have stepped into the breach and set up to manufacture goods cheaply in tax and wage havens, and send them into the rich corridors of the wealthy economies, driving out small to mid size businesses, and some large corporations as well, then stepping in to buy up the assets of these companies and idle the workers.
    And frankly, this is why there was a crash in the economy in 2008. The diminishing real wealth of the American populace, which came as a result of this corporatization of economies worldwide, left buyers with less and less buying power. Banks and governments stepped in to support the would be homeowners, until the REAL economy became so bad, that they began to default in the thousands.. Too many jobs lost, and being replaced with lower paying jobs.. and the housing bubble kept expanding..
    Frankly, the only way out for the developed countries is to adopt this unilateal equalization, or ‘offshore’ tax, to take some control of their own internal economies, and of the world economy. And there will be a fight over this from the corporations.
    This is not a ‘left wing’ or socialist reading. I believe in economic competition, and liberty. I do not believe in ‘laissez faire’ economy though, and the rise of the North American economy [I include Canada with US, we've been on par for a hundred years] came as a result of some protection being given to ‘onshore’ manufacturing. It took us two hundred years to develop an internally balanced economy, so we didn’t have to export raw materials and import finished goods, and it has taken about twenty years to destroy it with Global Free Trade.
    And again.. the citizens of the countries where the corporations have moved are only marginally improving from this. A very small percentage of the population of the world has benefited from it, while the average wealth [net worth per citizen, or average net worth, subtracting the top 1 per cent.] of the population of the developed countries has diminished hugely.
    I hope you read this.

  • David Ross

    I’m disappointed that no one pointed out that corporations do not really pay taxes but only collect taxes. The actual burden of those taxes are bore jointly by the corporation’s customers (in higher prices), the corporation’s employees (in lower wages and/or benefits), and the corporation’s shareholders (in lower net profits). It’s a nice political trick since none of these groups are aware that they are bearing this cost. What we really should be talking about is which groups of people should bear what proportion of the tax burden, since in the end there are only people to pay taxes.

    • Zing

      I agree, but I’m not disappointed because I don’t expect much from NPR when it comes to discussing for-profit corporations.

      What mechanism would you suggest to determine which group should bear which proportion of the tax burden?

  • Hardgrove Mike

    Mr. Hines seems to understand the reality of the tax system. GE is not the general rule, and the “system” does not need to be changed because of a handful of corporations. That’s the baby with the bath water. Most companies are paying tax rates far in excess of the global average – that makes them less competitive. And them are us.

  • Anonymous

    Not sure how corporations are the “victims” of the U.S. tax code; rather they seem to be the “VICTORS” over the tax code.

    Clearly, as the Supreme court has made corporations “people”, they should be paying the same taxes as the rest of us!

  • Grady Lee Howard

    Repeal corporate personhood and review corporate charters annually. When they don’t pay their taxes or endanger the environment kill the suckers.

    • new civility

      Spoken like a true loser; thanks

      • Cory

        You are why civility is dead. Dumb, inflammatory one liners are why I’m now more interested in revolution than dialogue. Build the walls of the gated communities very high, because sooner or later we’ll be coming for what’s ours.

  • Slowdog6490

    we don’t need reform we need revolution.

    u can legislate to death, but there will always be a loophole.

    we need to take it all back, simplify things a little, and make representation a temporary job and not a career.

    • new civility

      So…you advocate theft?

      • Cory

        I’d like to add battery as well. The poor should strive to injure the wealthy while forcibly taking back a reasonable share of the world’s resources.

      • http://profiles.google.com/atom.fullerene Adam Fuller

        The poor looting the rich is ugly, and rarely ends well for anyone, rich or poor. But if the rich acquire a greater and greater share of the population’s wealth, the poor will feel they have no options but violent revolt. The best solution would be for the rich to act responsibly and act to reduce income disparity, reducing the chance of violent revolt. It’s in their own interest.

  • roymerritt19@gmail.com

    At present I’m having to make payments for the 2009 tax year because circumstances forced me to withdraw from my 401k. The government offered me no break on what’s due nor any kind of consideration. I did receive a lot of correspondence informing what might befall me should I not pay the entire amount or should fall behind on the payments. The corporations complain that corporate tax rates in this country are to high, which is a specious argument for they know that they can utilize all these loopholes to get out of paying any taxes whatsoever leaving the burden to the middle class. They also know they can depend on the politicians they’ve bought and paid for, literally bribed to institutionalize this larceny through legislation. They have no since of patriotism, and this in my opinion makes them economic traitors more dangerous than any Islamic radical I could think of. The cozy relation of this administration with General Electric is very disappointing to me in that I thought President Obama was sensitive to what is facing the American public in these times. Despite receiving all these perks few of these corporations are creating jobs, have done their utmost to destroy our economy and depend on the taxpayers to bail them out when their failed policies comes back and bites them in the ass. I on the other hand have put my life on the line for this country during the Vietnam war have been a law abiding citizen for the whole of my 62 years paying my taxes every year I have worked. Sometimes it seems both political party’s seem intent on destroying the nation as if they are sworn enemies of the American people. One day things are going to get so bad that the working people in this country will have had enough and will bring about that revolution that Thomas Jefferson said should come about every so often. The apologist on the show have no credibility for we all know many academics and economist have a vested interest in these corporations and therefore have a conflict of interest. I for one am ready to have Jefferson’s revolution and bring these traitors to their knees and give them what they deserve, which is not a tax break. There is nothing free about the free market and capitalism has revealed that it is just another scam out to screw the
    average citizen. What has been happening to the American people is immoral and a cynical attempt to turn us into just another banana republic.

  • jlehm

    If these corporations are refusing/ getting around paying their far portion into the system, then how a majority of these same business men and women support distracting campaigns that focus on lowering taxes and not the problems that cause a need for those taxes???

  • roymerritt19@gmail.com

    What’s Mr. Hines opinion of a good approach toward these corporations. I suspect that he wishes they paid nothing at all. He is just another shill for these corporations not to be believed about anything and a disgraceful representative of the University of Michigan.

    • Ellen Dibble

      Ever since Reagan’s trickle-down theory burst upon the scene post-Jimmy Carter and long gas-lines and the cardigan-sweaters on a weeping first lady in the White House, ever since then it has seemed to me that academia is on the side of the theorists who come up with the Ponzi-type bubble schemes and the we’ll-use-the-poor-as-a-tax-deduction doctrine. It has made all MBA programs, for starters, look to me very suspect. They can tell corporate managers how to maximize profits.
      And the world will turn around and say that those of us with hopefully enough money to see us through to our dotage are demanding to maximize profits, and so therefore academia and corporate America are right to go for maximum profit. AARP and the babyboom is right there cheering them on.
      It is the grassroots, the 7.5 of us for every 1 of them, however Cory came up with that, who have to demand LESS profit, however irrational that may seem. Let the rich stew in their own juice. Let them found a new nation called Hedge-Fund-istan, and we will think good riddance.
      Now I ask you, would MBA programs adapt to what I’ll call a less corrupt (less maximize-profits) orientation? An orientation whose sense of responsibility matched their clout in government? Right now, “keeping government small” means keeping corporations small, or else they pump up government with their money to make our government to serve THEM, not us.

      • Nospam

        Atlas Shrugs

  • Nick

    I say, more power to ‘em. The IRS is a 100% corrupt agency whose job is to fleece the public on an obscene scale, and line the pockets of the military-industrial complex. If private companies can avoid giving their money to them and instead keep themselves healthy and their people employed, more power to ‘em.

    • Cory

      Tool.

  • Cory

    It is time for the 75 percent of us who have almost nothing to admit that we are powerless to tax or regulate corporations or the wealthy. They are smarter, wealthier, better connected, and better looking than the rest of us.

    What then are we left with? Answer: A 7.5/1 numerical advantage. We just need to wake up to our TRUE power. Won’t be today or tomorrow, but it is coming.

  • Albert Pierce

    This subject was well covered on 60 Minutes last Sunday. Five points I did not here on your show yet are:
    We have the highest corporate tax in the world. I can’t blame big corporations for using the laws to their advantage.
    With the highest corporate tax in the world what foreign company would want to move here.
    The international companies cannot bring those profits into the US without paying the tax, so the money stays offshore and that hurts us too.
    What about foreign companies with offices or plants in the US? You haven’t mentioned them.
    The CEO of GE is the head of a new “committee” assembled by Pres. Obama. What does that say?

    • ann

      Most large companies avoid paying the corporate tax, or have successfully diminished the tax amount paid.

      “Of the 500 big companies in the well-known Standard & Poor’s stock index, 115 paid a total corporate tax rate — both federal and otherwise — of less than 20 percent over the last five years, according to an analysis of company reports done for The New York Times by Capital IQ, a research firm. Thirty-nine of those companies paid a rate less than 10 percent.”
      from:http://www.nytimes.com/2011/02/02/business/economy/02leonhardt.html

      G.E. pays no taxes or exceptionally low taxes.
      from:http://www.nytimes.com/2011/03/25/business/economy/25tax.html

      Large companies, foreign or domestic, get their accountants and lawyers to dramatically reduce the taxes they pay. If foreign companies don’t want to come to the US, the reasons are not because of the corporate tax.

  • simpsonsmoviesucked

    tax is the business. the actual service and/or product is besides the point.

    I have worked both in 3rd world countries as a business facilitator, and at a big 4 firm, this is my conclusion.

    if you want to get rich easily and legally, just transfer what arguably *should* be us tax dollars, into your pockets. life is good

  • Lvives

    I thought the days described by Charles Dickens were over but they’re not. Our “capitalists” want the last crumb from the table and will kick over old ladies to get it. Taking away unemployment insurance from the unemployed. To live on what? Class war. It’s coming back.

  • Clavoie2112

    Most 401k’s own GE stock. GE works for the Shareholder. The Government works for the people, and it is the Government that is complicit in allowing, or not vigilant in working for the people.

  • Malcolm

    We have an alternative minimum tax for individuals, why don’t we have an alternative minimum tax for corporations?

  • Cheryl

    This makes my blood boil. I’m retired from the IRS and know that they may be audit every year, but the IRS is sorely undermanned, under resourced and underpaid when compared to the tax departments. And lobbying is no more than bribery, you don’t get a politicians ear unless you make a contribution. Our tax law is a bad joke and I was ashamed of it by the time I retired. The only solution might be a minimum tax that is a percentage of US gross receipts.

  • http://www.facebook.com/people/David-Jed-D-Schwartz/1536520874 David Jed D. Schwartz

    032911
    I listened to a repeat broadcast of this show (on US corporate taxes) on my way home from skiing in Newry, Maine. Somehow I got the impression that the current version of the US Tax Code rewards shipping formerly US based jobs and production overseas to 3rd world countries with vastly lower wage rates. So not only do we lose our comparative advantage due to the lower wage rates, that loss is compounded by the current version of the US TAx Code? Have we all been lulled to sleep by the TV and yes NPR’s occassionally soothing voices, although not on this particular show, neither the preceding version, The Connection. I took the long way home and passed a closed wooden dowel plant, numerous houses for sale. It begins to appear that this part of the country is in danger of closing down. Perhaps I am wrong. But if indeed it is true that the tax code continues to reward moving jobs overseas, where is the outrage? Apparently neither the Administration nor the Tea Party nor the more mainstream Republicans give a damn. Tax codes can be changed. And laws do in fact influence markets, and vice versa. That is one of the positive functions of government, to serve the interests of not just the corporations, but also those of the rest of the people.
    Andreas Daniel Fogg
    Somerville, MA 02143
    Tel 617 776 6645

  • Mark S.

    I can honestly say that I no longer love this country, the Corporate States of America. It is not the same country into which I was born. It is rapidly devolving into a Corporate, Social Darwinist, dystopic nightmare, engineered by a soulless, evil Republican politburo and abetted by the useful idiots in the Tea Party, zombies who believe that voting for the interests of their billionaire masters is the same as patriotism. If I had the opportunity to leave, I would do so in a New York minute. Given that I work for an foreign multinational that is adding employees in the the CSA rather than shipping American jobs overseas as GE does, the opportunity for a foreign posting is quite possible. Until that occasion arises, I guess I will have to live in a state of perpetual disgust and swallow my bile as best I can.

    • Dave in CT

      Then leave. Are you kidding? Why wouldn’t you want to stay and fight and rationally address our problems?

      Amazing you are supported by a foreign multinational company, the very entity we are being critical of today.

      Classic irrational position IMO, with all due respect, to celebrate the opportunity given to you (to move and have a job) by the very entity that is destroying our organic economy and liberty.

      Can you lay out your alternative? A more socialistic country with even bigger debt problems trying to give everyone what they want based not on real production, but a sense of entitlement and being “nice”?

      I think everyone who wishes we were more socialistic or communistic should be required to operate their own self-sufficient homestead for 5-10 years, to come to terms exactly with the concept of “no free lunch”, keeping what you earn, and to understand the link between work and productivity, wants and needs, and the fact that like it or not, we live in a world of scarcity that is only held at bay by work, not handouts.

      • Dave in CT

        Of course go after corrupt millionares and billionares and their political cronies, demand a level playing field, act on your own judgements about helping others etc, but so often here, the righteous anger that should be pointed at the corrupted elite that is made of Dems and Repubs, is pointed at the core notion of a marketplace, where individuals decide what to buy and what to make, and get feedback in the process based on what others want need, and having the freedom to adjust accordingly.

        Replacing that with a centrally-planned managed economy with utopian goals that will never be met by coercion and without people feeling the need to be productive, rather than expect to be taken care of, would be a grave error IMO.

        People seem to be enamored with the China model of centralized elites managing corporate state where the individual has very little worth, power, or control. People should go live there, and report back, before they are so quick to sell the US to that model.

      • Fredlinskip

        Dave
        How do you define socialistic? T Party seem to define “socialist” as any government program created with intent to benefit citizens. Is this your interpretation as well? Government itself would seem “socialist” by their definition.
        Is asking wealthy corps and individuals to pay a bit more taxes “socialist” then?
        IYP

        • Dave in CT

          I think the distinction is the role of government. Government as the arbiter/enforcer of the Rule of Law, the set of legal boundaries we choose via our representative legislative process to protect us from our worst human tendencies, and establish an equal opportunity, via equal protection and a level playing field to all before the law.

          The change comes when we go from enforcing equal protection by the law to enforcing equal outcomes by law. A big difference.

          Providing for a National Defense, and law enforcement actions from violent crimes to white collar crimes, would be the role of government. Also reasonable IMO would be coordinating Single Payer, Competitive Provider for essential, non-local things such as infrastructure and maybe health care.

          The obvious idea is by having a limited government that mainly establishes a level playing field in which people can pursue ends, instead of trying to provide ends, we have a lower tax burden. Arguing about rates/tax systems within that reduced burden is a good argument for another day.

          When the government moves away from simply enforcing the rule of law, and starts trying to engineer ends, instead of letting ends be achieved organically from the ground up by the combined actions and choices and ideas of individuals in a free marketplace of ideas and goods and services, then we get into the age old problems of coercion problems, bureaucratic inefficiencies, one-size-fits-all solutions, a lack of diversity of solutions and a lack of dynamism that lets the “best” ideas be put out and tested and used.

          A central government making all these choices and taxing us highly to achieve them would by more “socialistic”.

          The slippery slope of Centralized Power in government, and its tendency to corruption and collusion with non-free market capitalists, while disdaining the rights and respect of individual liberty has shown its problems in many flavors from Communism to National Socialism to Fascism to the current China model and of course our own State Capitalism rife with collusion between central planners and the financial sector that blows up in our face.

          Enforcing the rule of law, establishing a real rule of law, which would punish the corporate crimes we have seen recently, and the corruption of our government in bed with corporations, and letting companies fail instead of bailing them out, making them even bigger and more dangerous and less competitive, thus providing accountability to the owners/investors of risky ponzi schemes, is all possible without throwing out the freedom and utility of markets, and is compatible with a libertarian outlook.

          • Fredlinskip

            Dave,
            A lot to digest there.
            Too tired tonight to sort out and come up with much to say in return (perhaps ultimately not necessary) except, that I appreciate you taking the time for your thoughtful response.
            Thanks

          • Dave in CT

            Thank you! Always enjoy the conversation and perspectives around here….

            Along the same lines…

            http://www.thefreemanonline.org/headline/diversity-ends-rules/

    • Dan Cooper

      There’s something else you can do, you can read a Jonathan Franzen book. They’re written for people like you who hate America.

    • William

      I don’t fear the wealthy or companies, but I do fear the poor and illegal immigrants. Eventually, a spark, like what happened in LA 20 years ago will start a huge riot. I hope I don’t find myself in the middle of one of those riots.

  • Amos

    Nationalize all the assholes while we still can. Soon they will blatantly run the world and no longer have to hide behind the thin veil that we call a democratic political system. Americans and peoplple evershould start to take more pride in how much they contribute and less in what things they can buy or can buy or what they take home monetarily. We should care more about the least of us and our children;s education than about tax breaks for billionaires. The lives and opportunities of rich and the poor in this country should be getting closer every year not further away. The super rich in this country have a world view more in common with a Chinese billionaire or a Saudi oil sheik than they do with 98% of this country. We have all the things we need to make a managed economy work.

  • Fredlinskip

    Judging by these comments, there seems to be enough discontent with our “corporate-ruled country” to have a “movement” to counter and likely exceed the size of the “Tea Party”. Similar to TP, in it we would have elements ranging from intellectuals to a fairly radical “fringe”. Now all we need is a “corporation” such as Koch brothers to fund, organize, and provide buses to get us to rallies; although I imagine it might be a challenge to receive the coverage by the corporate media necessary to engender change.

  • Mark

    Since we are all becomming global, well then to make it fair for everyone, time for a Global tax system! This way, we eliminate this problem!

    • Dave in CT

      Please think through one world governance before you support it. Where will you turn when it is corrupted? Keep power as local as possible. The bigger and broader the power, the bigger and broader the corruption.

      I trust individuals acting within a rational, non-discriminatory frame of legal restraint, much more than centralized power.

  • Pingback: dre in the morning » Blog Archive » Wednesday: Good News Everyone!

  • Dave in CT

    Great point cutting into the capital and driving a Corolla….

    Not gonna happen….

    % of what they have is the truth.

  • Jameel

    James Hines – the real issue….

    The real issue is that we have to help the rich people, so they can help the poor people. And classism lives on!

    • Erin Stites

      The wealthiest country in the nation is proportionally the stingiest. That would be the great USA! Sorry but this is fact. Check UN reports! I’ve read that “all the worlds richest countries in 2003 spent $60 billion to help the poorest countries address the problems of poverty, lack of education and poor health. During the same period the spending of the same richest countries spent $900 billion for defense. That led the president of the World Bank at the time to suggest that a simple change of priorities would insure we’d never have to pay more than the lesser of these costs. Cha-Ching! What a concept! What we give comes back to us seven fold not only in $ but in good relations! Oh for more Jimmy Carters in the world

  • Douglas, Eugene, OR

    This discussion has it completely backwards. Of course corporations are trying to avoid taxes. It’s what they do. (Does anyone fault the lioness for killing gazelles?) Capitalism as we know it cannot exist without government subsidies (bailouts, wars, defense spending, stimuli, loopholes), and the sooner we recognize it, the sooner we can have a productive conversation. The fact is, the problem does not lie with the corporations; it lies with the government. The standard “devil made me do it” defense is a smokescreen. The government has CHOSEN to allow corporations to shift their profits offshore, which saves them 90 billion dollars a year (according to a recent study by a professor at Reed College). If mere citizens want to change that, we have to change the system (and with it, our point of view).

    • Citizen

      Amen, Douglas from Eugene.

      To take the argument one step further, the same logic can be applied to the relationship between the government and the citizens. Stated most briefly, we have the government we have because we elected the people that compose the government. We didn’t have a revolution (recently). We didn’t have (very) fraudulent elections. We elected this government.

      Just as capitalist corporations seek profits, politicians seek office. It’s neither good nor bad. The politicians do what we reward them for doing. Therefore, if we don’t like what they’re doing, we need to pay attention to the details and vote accordingly.

      Unless our officials start taking office by force, the problem lies neither with the corporations, nor the government – it lies with us, the electorate.

    • William

      It is just another reason to have a much smaller government and fewer government services, programs etc..

    • Fredlinskip

      Douglas (and William),
      Interesting points- not so sure I agree.
      1) Capitalism can exist without tax loopholes and corporations shouldering their share of tax burden- it has in the past- it can do so again.
      2) the argument is somewhat circular. Government officials seldom are elected to congress without corporate support, so you could say corps largely “choose our government”. When was the last time you saw someone get elected on an anti- corporation platform? (except perhaps Sanders- Vermont).
      On contrary we have seen people run on anti-government platforms. What does anti- government mean? For one it seems to mean let corps regulate themselves- don’t obstruct “free market”- corps will do the right thing. Yeah right. Last administration allowed corps to regulate their own pollution standards and let them regulate us into financial meltdown which further transferred wealth from “our” treasury to the already wealthy.
      Who do you think is stronger in America today, government (w/ currently trillion $ deficits) or corps (currently sitting on trillion dollar surpluses)? Of course corps want less government.

      You’re right citizens are going to have to change the system, but that’s an extremely uphill battle, considering that wealthy corps have waged such an effective propaganda campaign that they have people such as William believing that a weak government and cutting programs that benefit the middle and lower classes is the solution.

      • Douglas, Eugene, OR

        Those who define the terms win the argument. If the public understood that capitalism can not exist independently of government but instead requires constant and massive subsidies–if people understood markets were free only within highly manipulated boundaries–then the political landscape would change. We could have realistic debate. As it is now, discourse is skewed to the right which serves to empower the elites, which is the same thing as disempowering the public.

        Elections are conducted within the same safe framework. We may congratulate ourselves for living in a democracy, but we decide only between two carefully groomed candidates. The choice comes down to more or less, but always of the same. Most incumbents get reelected because they reassure those who benefit from the status quo (the wealthy) and are able to get financing, and because the media relentlessly focuses on celebrity, not ideas.

        Make no mistake about it, people want change. Obama was swept into office promising it. But once there, Obama has delivered more of the same. It takes more vision and toughness than he has to jump from the deep ruts of the status quo.

        Pro- or anti- labels are a good example of how one side tries to define the terms to win the argument. Because business needs so much financial and regulatory support from the government–and vice versa–they go hand in hand. The so-called “anti-government” position is not anti-government at all. It actually seeks a stronger government, but one that serves only business. But then, when is the last time you heard “anti-government” views described as “anti-people”? In a democracy, aren’t the people supposed to be the government? It’s clear who’s defining the argument–and who’s winning.

        And I for one think it’s time for a change.

        • Dave in CT

          “If the public understood that capitalism can not exist independently of government but instead requires constant and massive subsidies”I think our problem is precisely the opposite. The majority, through apathy, or misguided belief of crony propaganda (GE), think that capitalism CAN ONLY exist with government participation, subsidy and welfare, thus the corrupted State Capitalism we have today, that serves the interest of the elite in Government and Business, and their sycophants.What the public needs to understand is that apart from enforcing the basic rule of law, the benefits of freedom and markets, or Capitalism, CAN NOT exist WITH constant and massive subsidies and manipulation of the market for utopian ends. Time and time again in history we see that putting faith in a benevolent central planning scheme leads ultimately to both the diminishment or our personal liberties, and the corruption of the system to the benefit of the elites we have thus empowered.

          • Dave in CT

            A more individual liberty-centered system that limits the centralized power of governments and crony capitalists by the rule of law, may not be perfect from saving everyone from the ills of humanity or the realities of scarcity, but it is much better than the corruption of massive powers that are terribly difficult to ever escape from once entrenched. So we can try our best to maintain the liberty given to us by the American experiment, warts and all, or continue to dissolve into a more utopian central planning by elites society based on debt and coercion, and wait for the day we have to do our own “Egypt” or “Libya” to try and get out from under our corrupt despots. Given our systems military and intelligence powers (already against liberty principles) I don’t think we would stand much of a chance.

            Don’t know what you’ve got till its gone.

            Deluding ourselves that we’ve “got” some magical prescription of printing money and can have a free lunch of great 30 year retirements, free high cost/high tech health care, etc etc is an illusion. Much as we wish it so, we don’t got that.

            IMO the best we are going to get, is liberty, and the freedom to do our best to work for our own security and comfort in this world.

        • Fredlinskip

          Douglas
          This conversation thread may be a bit cold and may be writing to myself- but that’s okay.
          Think your description of present situation is well put and appreciate your response.
          Agree with inference that the ones that “control the narrative, control the day”. Somehow we need to shorten your commentary into a neat one liner- like “they hate us for our freedom” or “put America first” so as to put in a form more Americans are receptive.
          I choose to believe, of the 2 evils, that Grande Old Party represents a little more the “status quo” then do the Dems. Progressives maintain a vision of a better world, whereas conservatives, by definition, wish things to stay the same. Which is why 90% of all the positive changes in American History; such as women’s rights, end of slavery, even breaking form Britain in Revolutionary war- were all brought about by progressives (although party affiliation changed from time to time).
          Anti-government does mean anti-people by my definition.
          I am disappointed in Obama, but he has had so many enormous problems to face, I’m doing best to give him benefit of doubt. Not the least of these problems is that unlike his predecessor he has had a pretty consistent “reach across the aisle” to GOP attitude (trying to imitate Lincoln?), even though each time he does, he seems to get slapped in the face. To me reaching across aisle to Reps seems often akin to trying to shake hands with “the dark side of the force”.
          Like you, I am deeply concerned about direction our country is headed. I think our democracy (plutocracy?) is foundering on it’s foundations a bit. Not going to take much of an “earthquake” to really cause some damage at his point.
          Later

  • B.B.

    Companies who invest overseas get huge tax breaks from the foreign companies they operate in. There are physical “tax free zones” in China where foreign companies establish their operations. Why should they get an additional tax credit from the U.S. for the act of overseas investment? They are already getting a huge incentive for doing so. Do they really need double incentive??? I don’t think so. It’s just an excuse for another break. The Chinese use a carrot to get the U.S. multinational horse, back at home the horse tells Congress it deserves a carrot for getting a carrot overseas. This is stupid.

  • Erin Stites

    It’s time for people to pay attention and to speak up with your votes in the upcoming election. Our children are paying the price! We must work very hard to once again make corporate contributions off-limits. Campaign reform & immigration reform must be addressed! But, above all stop allowing tax breaks for corporations and the wealthy across the board. If this practice was good for America then why are so many people unemployed and working so much harder to survive. It’s not working on the national level and it won’t work on the state level.

  • Inclusive

    A
    Mess
    Everywhere
    Rich
    Influence
    Corrupts
    All

  • Michael

    The Irish bank (country with one of the lowest Corp Tax rate) needs another 24 billion dollar bail out.

    The Republic of Ireland’s banks need an extra 24bn euros (£21.2bn) to survive the financial crisis.

    The figure follows a stress test on the Irish banking system by a group of independent experts and the country’s central bank.

    Four lenders were tested – Allied Irish Banks, Bank of Ireland, Educational Building Society (EBS) and the Irish Life & Permanent.

    Allied Irish Banks needs most money, and will have to raise 13.5bn euros.

    Bank of Ireland needs 5.2bn euros, EBS 1.5bn euros, and Irish Life 4bn euros.

    The total amount poured into the Irish banks since the financial crisis will now be close to 70bn euros.

    Professor Patrick Honohan, governor of the central bank, said: “The new requirements are needed to restore market confidence, and ensure banks have enough capital to meet even the markets’ darkest estimates.”

    bbc 3/31/11

  • neal

    It’s WAY past time to make them pay!! Are we going back to the days of Calvin Coolidge, or what?? The creation of the middle class did not ONLY benefit the “middle class”, it benefitted our nation as a whole!! Big businesses and small businesses THRIVED, created jobs, etc; etc; when they paid their share of the tax burden! And, we did not have these atrocious budget deficits! Wasteful spending is not the sole culprit to blame for these deficits, the lack of REVENUE from those that have reaped HUGE windfalls (tav breaks) are the prominent factors!!

  • Michael

    Boeing subsidies illegal, says World Trade Organization The dispute between Boeing and rival Airbus has been going on for six years Continue reading the main story
    Related Stories
    EU to challenge Airbus aid ruling EU Airbus aid illegal, says WTO US aircraft manufacturer Boeing received at least $5.3bn (£3.3bn) in unfair aid from Washington, the World Trade Organization (WTO) has concluded.

    The subsidies included money for research and development from the Nasa space agency, a panel of international trade judges has ruled.

    Last year the WTO said that Boeing’s arch rival Airbus had received illegal aid from European governments.

    The two companies have been at war over state aid for almost six years

    This WTO panel report clearly shows that Boeing has received huge subsidies in the past and continues to receive significant subsidies today,” he said

    BBC-3/31-Boeing subsidies illegal, says World Trade Organization

  • Brennn511

    So are they agreeing to re-invest locally/nationally?
    Under what conditions do corps evade or produce “quality”?

  • Darlene Kiser

    I am writing a term paper. It says your audience is a mature, college-educated American interested in the problems of the modern world. Propose a solution to one of these critical problems. I also need a Title for this paper and a thesis. My problem: What is the government going to do about foreigners living in the USA without paying taxes but enjoying some benefits of a US citizen?

  • Jmsreedy

    Why are the top 3 pages of this topic or anything close to asking why corporations make so much money nothing but hired opinions. You can hardly find anything that is not taking up for companies making 5 million an hour! Are their pockets so deep that they can hire the Heritage Foundation to skew any facts?

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