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ofthisandthat Commentary |
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All rights reserved.
All rights reserved.
“Believe It or Not!”13 Mind-blowing Facts About America’s Tax-Dodging
Corporations
By Richard Eskow
Source: Campaign for America' Future
A judicious writer avoids adjectives like “mindblowing,” especially when covering
political or economic issues. But no other word seems to describe the stunning reality
of corporate taxation in modern America, which cries out for the italics-heavy,
exclamation-point-driven format made famous by “Ripley’s Believe It or Not.”
Stylistic overkill? Read these thirteen facts and you may change your mind.
1. We’re told we can’t “afford” full Social Security benefits, even though closing
corporate tax-haven loopholes would pay for Obama’s “chained CPI” benefit cut more
than ten times over!
Abusive offshore tax havens cost the US $150 billion in lost tax revenue every year
(via the FACT Coalition). That’s $1.5 trillion over the next ten years.
The “chained CPI” cut, proposed by President Obama and supported by Republicans,
is projected to “save” a total of $122 billion to $130 billion over the same time period
by denying benefits to seniors and disabled people.
It’s true. “Serious” politicians and pundits are demanding that ordinary people
sacrifice earned benefits, while at the same time allowing corporations to avoid more
than 10 times as much in taxes.
2. Corporate tax rates are near their 60-year low, even though profits are at a 60-year
high!
Need we say more?
(Source: Americans for Tax Fairness.)
3. Wells Fargo got $8 billion in tax breaks, even as executives at its subsidiary
Wachovia avoided indictment for laundering money for the Mexican drug cartels!
That’s right. Wells Fargo paid a negative tax rate of -1.4 percent between 2008 and
2010 while Wachovia, a Wells Fargo subsidiary, admitted to laundering more than
$378 billion for Mexican drug gangs.
We’re talking about crazed killers like “El Loco” and gangs like “Los Zetas” – gangs
who cut people’s heads off and toss them out onto disco dance floors or display them
in the town square.
Wachovia bankers ignored repeated warnings from law enforcement officials, and
continued to launder money for cartels that have murdered tens of thousands.
And yet no criminal indictments were handed down because, as a Senate investigator
told Bloomberg News, “There’s no capacity to regulate or punish them because they’
re too big to be threatened with failure.”
4. Some other huge corporations paid less than nothing, too.
Pepco Holdings (-57.6% tax rate)
General Electric (-45.3%)
DuPont (-3.4%)
Verizon (-2.9%)
Boeing (-1.8%)
Honeywell (-0.7%)
(Source: Citizens for Tax Justice)
5. The amount of money U.S. corporations are holding offshore is an estimated one
trillion dollars!
Rather than tax these profits the way other countries do, corporate politicians are
promoting a tax “repatriation” break that would let corporations “bring this money
home” while paying even less than their currently low rates.
They tried that in 2004 and it didn’t create any jobs. In fact, corporations took the tax
break and then fired thousands of people. What “repatriation” did do is line a lot of
wealthy investors’ pockets.
So, naturally, they want to do it again.
6. One building in the Cayman Islands is the official location of 18,857 corporations!
According to the Government Accountability Office, a five-story building called
“Ugland House” is home to nearly twenty thousand corporations. That’s impressive,
especially for such a small edifice. (Perhaps it has supernatural half-floors and space-
time defying “mind tunnels” like the office in Being John Malkovich.)
While impressive, Ugland House’s distinction pales next to that of 1209 North Orange
Street in Wilmington, Delaware. According to one investigation, that address is home
to 217,000 corporations.
That’s because Delaware has very generous tax rules – and, as a result, is home to
more than half of all the corporate subsidiaries in the United States.That’s startling,
since only 1/342th of the nation’s population lives in that state (917,092 residents, out
of a national total of 313,914,040, according to the latest census results).
7. Conservatives complain about the “official” corporate tax rate in this country, but
corporations actually pay roughly one-third of the official rate in actual taxes.
The official, or “statutory,” corporate tax rate is 35 percent. But the actual rate paid by
American corporations is only 12 percent, less than that paid by many middle-class
Americans.
(Source: The FACT Coalition.)
In fact, U.S. corporations pay less tax as a percentage of the GDP than corporations
in Canada. Or Japan …
… or South Korea. Or Norway. Or Luxembourg, New Zealand, Israel, the Czech
Republic, Sweden, Belgium, Switzerland, the United Kingdom, Denmark, Finland, and
Italy.
(Source: OECD StatsExtract interactive database.)
8. Corporations used to pay 30 percent of Federal taxes, and now they pay less than
7 percent!
That’s because the corporate tax rate has plunged since Dwight D. Eisenhower was
president and is now the lowest it’s been in modern history.
(Source: FACT Coalition.)
9. Big corporations paid $216 million to Congress and got $223 billion in tax breaks!
As Citizens for Tax Justice and USPIRG reported, 280 large and profitable
corporations contributed $216 million to Congressional campaigns over four election
cycles and got nearly a quarter of a trillion dollars in tax breaks.
That’s a terrific investment for them – a return of more than a thousand to one – but it’
s a bad deal for the American people.
10. We don’t even know who owns some corporations, even though that makes it
easier to evade taxes, dodge creditors, avoid paying alimony or child support, and
even fund terrorism!
The FACT Coalition lists some examples of investments that might represent a terror
threat. Corporate interests are blocking disclosure rules that would help protect our
national security.
11. Bank of America committed foreclosure fraud, was bailed out by the government,
and then paid no taxes on $4.4 billion in profit!
That’s right. In 2010, while BofA was negotiating a sweet settlement deal for its
foreclosure fraud, it paid nothing in taxes. (Source: FACT Coalition.) Zero, on $17.2
billion in offshore earnings. (Source: Americans for Tax Fairness.)
Its $4.1 billion tax break came on the heels of the bank’s taxpayer-funded bailout,
immunity from prosecution for its criminal employees, and a cushy government
settlement for its foreclosure fraud.
Now David Dayen reports that the bank has apparently continued to defraud
customers in violation of its government settlement. Whistleblowers have stated in
affidavits that they were “told to lie” to customers, continued to deceive homeowners
before foreclosing on them, and flipped customers to new servicing companies to
invalidate previous homeowner agreements.
12. What they call “tax reform” would actually prevent our elected representatives
from giving businesses financial incentives to improve our lives!
The word “reform” is an honorable one that’s been put to some dishonorable uses
lately. “Entitlement reform,” for example, is merely a euphemism for gutting Social
Security and Medicare.
Similarly, corporate-backed politicians are pushing a formula for permanent corporate
tax breaks and calling it “tax reform.” They insist their “reform” be “revenue neutral”
and say it will “broaden the base while lowering the rate.”
Here’s an English translation: The current, unsustainably low rates for corporations
would be made permanent, while eliminating many tax deductions in the name of
“simplification.”
Here’s what that really means: The domestic tax credit for creating jobs? Gone. Tax
breaks for protecting the environment with clean energy, rather than harming other
people’s health and leaving a mess for the rest of us to clean up? Gone.
All in all we’d lose dozens of important policies that make our lives better, while
permanently fixing corporate taxes at today’s cushy giveaway rates.
“Reform”? Ripoff is more like it.
13. Despite their greed, mismanagement, and freeloading, tax-dodging corporations
are using shell organizations like “Fix the Debt” and “the Committee for a Responsible
Federal Budget” to tell ordinary Americans they have to sacrifice even more to
preserve corporate wealth!
These organizations are using the heads of failed banks – people like Chase’s Jamie
Dimon and Lloyd Blankfein of Goldman Sachs – to dispense “advice on the economy.”
That’s like getting navigation tips from the captain of the Exxon Valdez.
(Tax breaks for Exxon Mobil: $4.1 billion between 2008 and 2010. The company paid
no taxes at all in 2009.)
These executives and their paid spokespeople tell the rest of us we need to “sacrifice”
and “tighten our belts” so that their party can go on forever. And too often they’re
treated as credible sources, rather than as corrupting influences on our public life.
It’s all true – and there are many more astonishing facts to be found in the world of
corporate taxation. To fix the economy more people will need to learn about them –
and demand that they be changed.
The writer and analyst in me wants to apologize for all the italicizing and all those
exclamation points. But the American citizen in me wants to shout the truth out for all
the world to hear – believe it or not!
Corporations
By Richard Eskow
Source: Campaign for America' Future
A judicious writer avoids adjectives like “mindblowing,” especially when covering
political or economic issues. But no other word seems to describe the stunning reality
of corporate taxation in modern America, which cries out for the italics-heavy,
exclamation-point-driven format made famous by “Ripley’s Believe It or Not.”
Stylistic overkill? Read these thirteen facts and you may change your mind.
1. We’re told we can’t “afford” full Social Security benefits, even though closing
corporate tax-haven loopholes would pay for Obama’s “chained CPI” benefit cut more
than ten times over!
Abusive offshore tax havens cost the US $150 billion in lost tax revenue every year
(via the FACT Coalition). That’s $1.5 trillion over the next ten years.
The “chained CPI” cut, proposed by President Obama and supported by Republicans,
is projected to “save” a total of $122 billion to $130 billion over the same time period
by denying benefits to seniors and disabled people.
It’s true. “Serious” politicians and pundits are demanding that ordinary people
sacrifice earned benefits, while at the same time allowing corporations to avoid more
than 10 times as much in taxes.
2. Corporate tax rates are near their 60-year low, even though profits are at a 60-year
high!
Need we say more?
(Source: Americans for Tax Fairness.)
3. Wells Fargo got $8 billion in tax breaks, even as executives at its subsidiary
Wachovia avoided indictment for laundering money for the Mexican drug cartels!
That’s right. Wells Fargo paid a negative tax rate of -1.4 percent between 2008 and
2010 while Wachovia, a Wells Fargo subsidiary, admitted to laundering more than
$378 billion for Mexican drug gangs.
We’re talking about crazed killers like “El Loco” and gangs like “Los Zetas” – gangs
who cut people’s heads off and toss them out onto disco dance floors or display them
in the town square.
Wachovia bankers ignored repeated warnings from law enforcement officials, and
continued to launder money for cartels that have murdered tens of thousands.
And yet no criminal indictments were handed down because, as a Senate investigator
told Bloomberg News, “There’s no capacity to regulate or punish them because they’
re too big to be threatened with failure.”
4. Some other huge corporations paid less than nothing, too.
Pepco Holdings (-57.6% tax rate)
General Electric (-45.3%)
DuPont (-3.4%)
Verizon (-2.9%)
Boeing (-1.8%)
Honeywell (-0.7%)
(Source: Citizens for Tax Justice)
5. The amount of money U.S. corporations are holding offshore is an estimated one
trillion dollars!
Rather than tax these profits the way other countries do, corporate politicians are
promoting a tax “repatriation” break that would let corporations “bring this money
home” while paying even less than their currently low rates.
They tried that in 2004 and it didn’t create any jobs. In fact, corporations took the tax
break and then fired thousands of people. What “repatriation” did do is line a lot of
wealthy investors’ pockets.
So, naturally, they want to do it again.
6. One building in the Cayman Islands is the official location of 18,857 corporations!
According to the Government Accountability Office, a five-story building called
“Ugland House” is home to nearly twenty thousand corporations. That’s impressive,
especially for such a small edifice. (Perhaps it has supernatural half-floors and space-
time defying “mind tunnels” like the office in Being John Malkovich.)
While impressive, Ugland House’s distinction pales next to that of 1209 North Orange
Street in Wilmington, Delaware. According to one investigation, that address is home
to 217,000 corporations.
That’s because Delaware has very generous tax rules – and, as a result, is home to
more than half of all the corporate subsidiaries in the United States.That’s startling,
since only 1/342th of the nation’s population lives in that state (917,092 residents, out
of a national total of 313,914,040, according to the latest census results).
7. Conservatives complain about the “official” corporate tax rate in this country, but
corporations actually pay roughly one-third of the official rate in actual taxes.
The official, or “statutory,” corporate tax rate is 35 percent. But the actual rate paid by
American corporations is only 12 percent, less than that paid by many middle-class
Americans.
(Source: The FACT Coalition.)
In fact, U.S. corporations pay less tax as a percentage of the GDP than corporations
in Canada. Or Japan …
… or South Korea. Or Norway. Or Luxembourg, New Zealand, Israel, the Czech
Republic, Sweden, Belgium, Switzerland, the United Kingdom, Denmark, Finland, and
Italy.
(Source: OECD StatsExtract interactive database.)
8. Corporations used to pay 30 percent of Federal taxes, and now they pay less than
7 percent!
That’s because the corporate tax rate has plunged since Dwight D. Eisenhower was
president and is now the lowest it’s been in modern history.
(Source: FACT Coalition.)
9. Big corporations paid $216 million to Congress and got $223 billion in tax breaks!
As Citizens for Tax Justice and USPIRG reported, 280 large and profitable
corporations contributed $216 million to Congressional campaigns over four election
cycles and got nearly a quarter of a trillion dollars in tax breaks.
That’s a terrific investment for them – a return of more than a thousand to one – but it’
s a bad deal for the American people.
10. We don’t even know who owns some corporations, even though that makes it
easier to evade taxes, dodge creditors, avoid paying alimony or child support, and
even fund terrorism!
The FACT Coalition lists some examples of investments that might represent a terror
threat. Corporate interests are blocking disclosure rules that would help protect our
national security.
11. Bank of America committed foreclosure fraud, was bailed out by the government,
and then paid no taxes on $4.4 billion in profit!
That’s right. In 2010, while BofA was negotiating a sweet settlement deal for its
foreclosure fraud, it paid nothing in taxes. (Source: FACT Coalition.) Zero, on $17.2
billion in offshore earnings. (Source: Americans for Tax Fairness.)
Its $4.1 billion tax break came on the heels of the bank’s taxpayer-funded bailout,
immunity from prosecution for its criminal employees, and a cushy government
settlement for its foreclosure fraud.
Now David Dayen reports that the bank has apparently continued to defraud
customers in violation of its government settlement. Whistleblowers have stated in
affidavits that they were “told to lie” to customers, continued to deceive homeowners
before foreclosing on them, and flipped customers to new servicing companies to
invalidate previous homeowner agreements.
12. What they call “tax reform” would actually prevent our elected representatives
from giving businesses financial incentives to improve our lives!
The word “reform” is an honorable one that’s been put to some dishonorable uses
lately. “Entitlement reform,” for example, is merely a euphemism for gutting Social
Security and Medicare.
Similarly, corporate-backed politicians are pushing a formula for permanent corporate
tax breaks and calling it “tax reform.” They insist their “reform” be “revenue neutral”
and say it will “broaden the base while lowering the rate.”
Here’s an English translation: The current, unsustainably low rates for corporations
would be made permanent, while eliminating many tax deductions in the name of
“simplification.”
Here’s what that really means: The domestic tax credit for creating jobs? Gone. Tax
breaks for protecting the environment with clean energy, rather than harming other
people’s health and leaving a mess for the rest of us to clean up? Gone.
All in all we’d lose dozens of important policies that make our lives better, while
permanently fixing corporate taxes at today’s cushy giveaway rates.
“Reform”? Ripoff is more like it.
13. Despite their greed, mismanagement, and freeloading, tax-dodging corporations
are using shell organizations like “Fix the Debt” and “the Committee for a Responsible
Federal Budget” to tell ordinary Americans they have to sacrifice even more to
preserve corporate wealth!
These organizations are using the heads of failed banks – people like Chase’s Jamie
Dimon and Lloyd Blankfein of Goldman Sachs – to dispense “advice on the economy.”
That’s like getting navigation tips from the captain of the Exxon Valdez.
(Tax breaks for Exxon Mobil: $4.1 billion between 2008 and 2010. The company paid
no taxes at all in 2009.)
These executives and their paid spokespeople tell the rest of us we need to “sacrifice”
and “tighten our belts” so that their party can go on forever. And too often they’re
treated as credible sources, rather than as corrupting influences on our public life.
It’s all true – and there are many more astonishing facts to be found in the world of
corporate taxation. To fix the economy more people will need to learn about them –
and demand that they be changed.
The writer and analyst in me wants to apologize for all the italicizing and all those
exclamation points. But the American citizen in me wants to shout the truth out for all
the world to hear – believe it or not!