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Wednesday, December 14, 2011

Taxes

We often hear Republicans argue in favor of lowering American corporate taxes. It's true that our corporate tax rate is quite high. What they don't tell you is the fact that loopholes and accounting "tricknology" give major corporations the chance to reduce or eliminate their burden.

Many of our biggest companies pay more to lobby lawmakers than they do in taxes.
Of the 30 companies analyzed in the report, which include corporate giants such as General Electric, Verizon Communications, Wells Fargo (WFC), Mattel (MAT) and Boeing (BA), 29 of them managed to pay no federal taxes from 2008 to 2010. Only FedEx, which raked in about $4.2 billion in profits during that period, paid a three-year tax rate of 1 percent -- totaling $37 million -- far less than the statutory federal corporate tax rate of 35 percent.

Citizens for Tax Justice, the sister organization to the Institute on Taxation and Economic Policy, reports that 68 of the 265 most consistently profitable Fortune 500 companies did not pay a state corporate income tax during at least one year between 2008 and 2010, while 20 of them paid no taxes at all during that period.

"Our report shows these corporations raked in a combined $1.33 trillion in profits in the last three years, and far too many have managed to shelter half or more of their profits from state taxes," Matthew Gardner, Executive Director at the Institute on Taxation and Economic Policy and the report's co-author, said in a statement. "They're so busy avoiding taxes, it's no wonder they're not creating any new jobs."
Even while dodging most of their state and federal taxes between 2008 and 2010, Verizon (VZ) laid off more than 21,000 U.S. employees, while Boeing, Wells Fargo, General Electric, American Electric Power, and FedEx also let go of thousands of workers.
Moreover, as it was laying off employees, General Electric gave their top executives a 27 percent pay raise between 2008 and 2010 -- executives received more than $75 million in compensation in 2010. Wells Fargo increased executive pay by a whopping 180 percent, upping executive compensation from $17.8 million in 2008 to almost $50 million in 2010, while Boeing, FedEx and American Electric Power also instituted lavish executive pay raises while laying off thousands of lower-level workers.

In fact, 2010 year was a record year for executive compensation...
So what was this crap we were hearing about Obama wanting to redistribute wealth? The redistribution has all gone to the affluent. Back in the 1980s, Jesse Jackson accused Ronald Reagan of being a "reverse Robin Hood." That appellation more properly belongs to Barack Obama. And I bet you could get Jackson to admit it, if you could get a private parlay with him.

Pretty soon, they'll be trying to convince us that the Dubya years were the Good Old Days. In response, lay this figure on 'em:
Meanwhile, the U.S. Census Bureau reports that the median household income fell $3,719 between 2000 and 2010, when measured in 2010 dollars.
This just in from Wackyland: I caught a glimpse of a cable news show -- Fox, I think -- which reported on a poll in which respondents fingered the greatest problem facing the country today. Eight percent said "Big Labor."

Eight percent? Okay, that's not a huge number. But still -- if you meet twelve people today, chances are that one of those people will think that most of our problems can be traced to those all-powerful unions.

Who are these people?

The payroll tax cut. Fox News also portrayed the payroll tax cut extension in line with their standard meme: "Republicans stand for lower taxes." They didn't remind their audience that most of the House Republicans didn't want to vote for the cuts originally. They did so only when wrangled into position by John Boehner. Boehner wanted to pass to bill not because of the cuts per se, but because of a lot of other crap injected into the legislation:
In particular, Democrats and the White House oppose a number of GOP-backed provisions: a measure forcing the Obama administration to expedite its decision about whether to green light construction the Keystone XL pipeline; out-year spending caps that could further reduce funding to key federal programs; and other restrictions including one that would allow states to drug test unemployment applicants.

The GOP bill also includes a steep increase in Medicare costs for middle class and upper class beneficiaries to help offset the cost of the payroll holiday.
Because of that additional crap -- and not the cuts themselves -- the bill is dead in the Senate and Obama has threatened to veto. Whether Obama will be as good as his word remains to be seen. The whole mess threatens to devolve into a government shutdown. By my count, this constitutes the third time this year we have come close to that precipice.

Obviously, this bill was crafted to make it appear that the Democrats hate tax cuts. In fact, they are concerned with Medicare and unemployment benefits.

This maneuver will go a long ways toward erasing public memory of one difficult-to-forget fact: Most or all of the candidates running for the GOP nomination have spoken out in favor of increasing federal taxes on lower-income people while decreasing taxes on the wealthy and corporations.
Comments:
I think it's safe to say the Republicans make no sense and favor ideology and profit over the people they're suppose to represent. The 48% of Americans pay no taxes is all about getting rid of the Earned Income Tax Credit for low income people. Rather than squawk about the tax credit, why isn't there discussion that in the United States of America 48% of the population is deemed 'low income,' or over 20% of American children are classified 'food insecure.'

No, they would rather give tax breaks to the mythical 'job creators,' who are all about extracting whatever wealth they can get their grubby hands on. That's not giving the Dems a pass; they've been all too passive, let's not make any waves during this decade+ long debacle.

But the Repugs? They've gone stark-raving mad.

Peggy Sue
 
Drug test unemployment applicants. Nice.

Have they considered random drug testing of Congressman and Senators?

I mean they wouldnt wanna mandate something for others they wouldnt accept themselves. And its not as if the public dont have a right to know.

Harry
 
When Republicans state that 48% of Americans pay no taxes, they often fail to specify they mean no Federal taxes. Such people often pay, state taxes, property taxes and sales taxes.

I dont think Republicans are raving mad. They are just very focused on their own interests. Not mad but selfish, and unpatriotic.

Harry
 
As a little-tiny business owner with a couple of employees, I'm not sure why this is always labeled as a payroll tax cut; the only cut I've seen is in the employee contribution to Social Security. The company still has to pay in its full share, but the employee does not. This is not a cut on income taxes, note, but a cut in the revenue stream into SS. The intent is to make the "social security will soon be bankrupt" warning a self-fulfilling prophecy. I don't understand why people don't get this. And with the decrease in the individual's contribution, the argument that "they can't take SS away because I paid into it" will be considered moot.

Between starving the SS fund and stealing from it, they'll definitely destroy it, and probably before the last of the boomers stands to collect.

tle
 
Social Security, one of the most successful of FDR's New Deal programs has been under assault from the right since its inception. It has withstood attacks from Reagan to Bush the Smarter onto Bush the Lesser and survived. Too bad its demise will be brought about by a faux democrat to wrapped up in himself to realize its value.
 
I agree with Anon.

Its a wither and die policy for social security. I dont know if its what Obama intends, but its why the GOP allowed this one through.

Saw the same thing happen to the US Postal Service. You have to hand it to them. The strategy works.

Harry
 
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