Corporate profits

The Corporate Tax Dodge - Billions in Avoided Taxes While America Goes Broke

The Senate Subcommittee on Investigations held a hearing, Offshore Profit Shifting and the U.S. Tax Code. Did you know U.S. Multinational Corporations have more than $1.7 trillion in untaxed profits stashed as undistributed foreign earnings and keep at least 60% of their cash overseas? That these earnings have increased 400% in the last decade? That corporate tax as a percentage of total Federal revenues has dropped to only 8.9%?

More Dire Reports Show the American Labor Force is in Huge Trouble

U.S. Corporations made record profits in 2011 while regular people went without jobs. A new study from the International Labor Organization shows Corporate Profits are doing fine and back to pre-recession levels. Yet this is at the expense of American workers and investment in America.

The ILO covers labor internationally. From their report, the world of work, there are some dire predictions. Austerity is one thing killing economies. The authors also found no recovery in sight for labor markets. They also realize as do many, except for those who could actually do something, if policies were enacted that were geared towards labor, we would not be in this mess and finally, the high unemployment and never ending income inequality is brewing up a nasty mix of social unrest.

More than half of 106 countries surveyed by the ILO face a growing risk of social unrest and discontent.

Add to that a new report from the Census, in part sponsored by the ,Kauffman Foundation, shows start-up companies are at record lows, 8%, in the United States.

Why the Rich Love High Unemployment

Originally published in Truth Out


The headquarters of JPMorgan Chase in New York. A JPMorgan research report concludes that the current corporate profit recovery is more dependent on falling unit-labor costs than during any previous expansion.  (Photo: Jessica Ebelhar / The New York Times)

Christina Romer, former member of President Obama's Council of Economic Advisors, accuses the administration of "shamefully ignoring" the unemployed. Paul Krugman echoes her concerns, observing that Washington has lost interest in "the forgotten millions." America's unemployed have been ignored and forgotten, but they are far from superfluous. Over the last two years, out-of-work Americans have played a critical role in helping the richest one percent recover trillions in financial wealth.

Obama's advisers often congratulate themselves for avoiding another Great Depression - an assertion not amenable to serious analysis or debate. A better way to evaluate their claims is to compare the US economy to other rich countries over the last few years. 

On the basis of sustaining economic growth, the United States is doing better than nearly all advanced economies. From the first quarter of 2008 to the end of 2010, US gross domestic product (GDP) growth outperformed every G-7 country except Canada.

But when it comes to jobs, US policymakers fall short of their rosy self-evaluations. Despite the second-highest economic growth, Paul Wiseman of the Associated Press (AP) reports:

The U.S. job market remains the group's weakest. U.S. employment bottomed and started growing again a year ago, but there are still 5.4 percent fewer American jobs than in December 2007. That's a much sharper drop than in any other G-7 country.

A Little Extortion Never Hurts the Bottom Line

Original published on The Agonist

It used to be if a corporation wanted to practice the dark art of extortion, it would do so well outside of the public eye. Not these days; company CEOs are out in the open and proud of it when they want to extract yet more money out of the taxpayers.

Take the case of Caterpillar CEO Douglas Oberhelman. He wrote a letter to Illinois state governor Pat Quinn, complaining about the state’s recent increase in the corporate tax rate from 4.8% to 7.0%. He said at least four other states have approached the company offering generous allowances if Caterpillar would move its headquarters out of Peoria, Illinois. Neighboring states of Indiana and Iowa have admitted to lobbying Caterpillar, as has the far-away state of Texas. The company said it wasn’t threatening Gov. Quinn over the tax increase, but it had “to do what’s right for Caterpillar.” That’s corporate-speak for “we’re threatening to leave the state if you don’t rescind this tax increase.”