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A Third Of Cash Is Held By 5 US Tech Companies (siliconbeat.com)
An anonymous reader writes: Moody's Investors Service released an analysis Friday that shows Apple, Microsoft, Alphabet, Cisco Systems, and Oracle are sitting on $504 billion, which is roughly 30% of the $1.7 trillion in cash and cash equivalents held by U.S. non-financial companies in 2015. Almost all of their earnings ($1.2 trillion) are stashed overseas in an effort to avoid paying taxes on moving profits back to the U.S. under the country's complex tax code. Apple has more than 90 percent of its money located outside of the U.S., according to its most recent filings. Moody's said in its report that "we expect that overseas cash balances will continue to grow unless tax laws are changed to encourage companies to repatriate money." Some of the other tech and Silicon Valley companies in the top 50 include Intel, Gilead Sciences, Facebook, Amazon, Qualcomm, eBay, Hewlett-Packard and Yahoo.
I bet their accountants are killing themselves over how much inflation costs them each year alone.
The responsibility it to the shareholder, no the government.
Trump wants to legalize companies to bring in that money into the USA without having to pay taxes. Basically a big present he'll give them.
meh, the money is overseas because they don't want to pay taxes. They want the poor and middle class to pay for everything, but then turn around and hire employees trapped under the h1-b indenture...err, I mean temporary employment with no rights plan... hey, sounds like the middle class to me :P
Ah, financial news - a place where you can open make statements like: "Unless the US changes its laws to give me lots of money, I can't help but foresee DIRE, DIRE things happening. Financial catastrophe would be putting it lightly." ... and not only is it counted as somehow news, but the richer or more openly lying the person saying it, the more respect it is given.
Well, WELL past the point of poe's law.
Ryan Fenton
After deliberately excluding:
-private citizens
-governments
-non-us companies
-financial companies
and passively excluding companies that operate at slim profit margins, and knowing that wealth distributions are naturally topheavy, we are supposed to be surprised by this 30% figure? Well it's not surprising at all.
It's like if you made a list of large carnivorous land mammals other than bears and canines, and were utterly shocked that over 30% of them were big cats.
While I'm entirely in favour of companies that use tax havens being punished for doing that, I also think that these companies should pay taxes on earnings made in country X in that same country. A number of major US companies earn a majority of their money in overseas markets. Apple, for example, is being lambasted by 'financial analysts' for the fact that only 60% of their earnings are from overseas markets. Those countries will expect them to pay taxes on earnings made in that country locally and not the US. Expecting companies to bring all their overseas earnings back to the US so that they may be taxed there and not in the country where those profits were made is pretty naive if only because it would really piss off the governments that control those markets and hurt the ability of American export companies to compete.
I hope enough of us flesh and bone humans realize soon enough that corporations just aren't like us. Their interests and motivations are not ours. Either they will rule or we will rule. We had better get to work before it's too late.... http://www.movetoamend.org/
When the king heard the words of the Book of the Law he tore his robes.2Kings22:11
Anyone that thinks the valley is anything other than the new Wall Street/oligarchy is kidding themselves.
"unless tax laws are changed to prevent the expatriation of cash to tax havens avoid paying taxes"
The difference between Theory and Practice is greater in Practice than in Theory.
we expect that overseas cash balances will continue to grow unless tax laws are changed to encourage companies to repatriate money.
Or some general-interest minded politicians could pass laws that coerce big companies into paying their share of taxes. But today, that looks like a dream
This story would only be accurate if those companies were holding the $500 billion in actual physical $100 bills in a vault. They are not. This $500 billion is merely entries in a database on a bank server and thus should be compared to the total M4 money supply, not M0. While $500B is a tremendous amount of money, the story would be much less shocking if the correct comparison was made.
Those same companies that built the infrastructure promising a national profit of $19 trillion. http://www.cisco.com/c/en/us/s.... IMO, the Internet of Thangs will be a good portion done by small businesses for very specific markets or even particular companies. We should all become engineers and build the machines to replace us. "Machines are going to take your job, and then they're going to take your life." Taylor Swift ~~~~ 3
So there is all this money sitting in those corporate accounts, the politicians are salivating just thinking about all that dough that was created by those businesses.
I suggest that those businesses buy gold to hedge against inflation imposed upon them by the politicians.
You can't handle the truth.
A Third Of Cash Is Held By 5 US Tech Companies
roughly 30% of the $1.7 trillion in cash and cash equivalents held by U.S. non-financial companies in 2015
So actually it should be:
A third of all cash held by US non-financial companies in 2015 is held by 5 US tech companies
systemd is Roko's Basilisk.
Ala ma bell. Although there may be no monopoly of services, a case can be made that hoarding cash overseas is detrimental to the stability of the country.
Corporations should not pay income taxes. The reality is they already don't. Their customers pay it for them in the increased price.
The reality in 2030 is that the Baby Boomers will be retired, retirees will outnumber workers, and Medicare/Social Security will consume two-thirds of the federal budget. Taxes will have to go way up to pay for everything else.
umm, the money is overseas because it's *earned* overseas. Arguably the shareholders should see some of it, but the US government has no claim.
That Apple funnels US profits in a Nevada shell company to avoid paying state corporate taxes, including taxes in California where corporate headquarters are located.
http://www.nytimes.com/2012/04/29/business/apples-tax-strategy-aims-at-low-tax-states-and-nations.html
Just get rid of all corporation tax. It doesn't really matter, resulting increase sales and personal income will more than make up for it.
:T:R:A:N:S:
Trump only wants to lower corporate taxes (while also raising tax rates for rich people by taking out loopholes, funny you forgot that part).
Apple has said before that if the rate were reasonable, they'd be happy to bring the cash back - so by lowering the corporate tax rate, the U.S. government would get a giant lump sum from these companies. What is not to like?
By the way, if you think Hillary is not going to work the exact same deal you are smoking something. Hillary is far more in bed with corporate interests than Trump could ever dream of.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
The responsibility it to the shareholder, no the government.
Here I thought the responsibility of the tax code was to the voters.
Precisely. Politicians are voting for things not in the interest of their constituents exactly the way they always do. Constituents are being deprived of information and fed bread and circuses to distract them from the activity of the Politicians.
One thing people in power know is to keep information away from the public. 2,600 years after being written, the majority of people know only what some twit paraphrased for them and called "The Republic".
-The wise argue that there are few absolutes, the fool argues that there are no probabilities.
The reality in 2030 is that the Baby Boomers will be retired, retirees will outnumber workers, and Medicare/Social Security will consume two-thirds of the federal budget. Taxes will have to go way up to pay for everything else.
Or we could start making soylent green. Valence the budget and feed the hungry.
Or we could start making soylent green.
That would be ageism — and taste really, really bad.
The U.S. Corporate tax rate is something ridiculous like 35%. They can claim profits are in a country as close as Canada and it would only cost them 15%. You can't be this wildly out of balance in a global market and expect to function well. This is a fundamental aspect of free market capitalism. Actually, if the U.S. lowered the rate to even something like 17% I'm sure they'd generate more revenue, instead of less. A company the size of Google likely spends a great deal of money on clever accounting to avoid taxes. They wouldn't need to do it if there was little or no benefit.
If it ain't broke, don't fix it.
I'm sure the old people would vote that the soylent green is made from young people.
https://en.wikipedia.org/wiki/Inverted_totalitarianism
Taxes will have to go way up to pay for everything else.
Or, we could spend less (especially now, before spending ever more on interest we can't afford is inevitable), and LOWER taxes in ways that generate - as they have repeatedly in the past - far more tax revenue because of much more (competitively, rather than punitively taxed) activity, especially as conducted domestically rather than overseas.
Don't disappoint your bird dog. Go to the range.
That money was never taken out of the country, so why is it "moving it back"? If Apple sells an iPhone in Japan and it manufactured the phone in China, why should it deposit the profits on that money in a US bank?
Any guest worker system is indistinguishable from indentured servitude.
And reclaim, repatriate the cash as booty. Easy! Problem solved!
Ha ha
[...] LOWER taxes in ways that generate - as they have repeatedly in the past - far more tax revenue because of much more (competitively, rather than punitively taxed) activity [...]
Voodoo economics has never worked. If it did, the Bush tax cuts would have prevented the Great Recession from happening. A $4T tax cut over ten years have failed to produce more tax revenue to cover the shortfall and then some. It didn't help that Bush had multi-trillion-dollar wars off the books that Obama put on the books. Obama making the tax cuts permanent without corresponding cuts in government spending didn't help either.
Facebook, eBay are *NOT* tech companies. Just because you have a website doesn't make you a tech company as I see it. Amazon is more is more akin to Walmart than technology. Google and Apple are borderline, but they really make much of their money on non-technical ventures.
You're confused. The recession didn't happen because we weren't collecting enough taxes. You get that, right? The recession largely happened because the credit markets dried up as a result of a housing bubble caused by too-easy-to-get loans as the industry was pressured (by democrats) into making. Far, far too many people were in over their heads, debt-wise. Had nothing to do with tax revenue at all. Combine the credit crunch with rapidly growing foreign competition in sectors that the US used to enjoy all to itself, and there you have it. The real question is why the recovery is so slow. Partly, foreign competition. But mostly, a business environment in the US that is completely hostile to the very sort of investment and activity that would generate job growth outside of the burger flipping and door greeter segments.
Don't disappoint your bird dog. Go to the range.
So instead of 30%
Which is robbery and higher than anywhere else on earth, very possibly the galaxy.
the companies only have to pay 10%. That's a legalized evasion of 20%.
Singing a different tune now aren't you? Originally it was "nothing", now it is 10% of HUNDREDS OF BILLIONS. You know what is zero? What they government gets now.
Are you stupid or a liar? I can't decide which is more likely. You can respond further if you like, IDC as I'll just be chortling at you being wrong to the tune of tens of billions of dollars for many years to come.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
Revoke their charter if they are not prepared to contribute to the societies that grant them a license to exist. After all they are users of infrastructure and they expect the community to absorb all manner of negative externalities. It's only right that they contribute their share of tax if the rest of us do.
My ism, it's full of beliefs.
The recession largely happened because the credit markets dried up as a result of a housing bubble caused by too-easy-to-get loans as the industry was pressured (by democrats) into making.
Wall Street needed no pressure to abandon underwriting standards to sell bogus derivatives that they knew were worthless over and over again. Massive fraud was committed. You will find a dozen books on the subject at the library.
The real question is why the recovery is so slow.
It took 25 years for the US to recover from the Great Depression. What makes you think that the recovery from the Great Recession, which almost became another Great Depression, is going to be faster than that?
What's being discussed here is called a repatriation tax holiday - https://en.wikipedia.org/wiki/... - which was tried most recently in 2004 by Dubya Bush.
Companies got the tax rate of 5% to bring back over $360 billion which was used to pay dividends, repurchase shares and buy other companies.
The net effect *cost* the Treasury $3 billion and the companies reduced their US workforce by 20,000 jobs.
The recession largely happened because the credit markets dried up as a result of a housing bubble caused by too-easy-to-get loans as the industry was pressured (by democrats) into making. Far, far too many people were in over their heads, debt-wise. Had nothing to do with tax revenue at all.
Yes, blame the Democrats is your story.
Which would be more believable, if not for the rampant amounts of fraud that banks engaged in before with their deceptive bookkeeping and after, with all of their false affidavits for foreclosures. They abused process to enrich themselves.
Because the only pressure they had was their own sense of greed.
A bunch of con artists scamming victims, now with the nerve to say they were made to do it.
Much like Enron was made to engage in fraud? Volkswagen? Oracle? Arthur Anderson? The New England Patriots?
I bet you believe Oliver North was a hero too.
Repatriation Tax Holiday of 2004 benefited the shareholders by over $300 billion but cost the Treasury $3 billion and those companies, shortly thereafter, cut their workforce by a collective 20,000 employees.
https://en.wikipedia.org/wiki/...
Short answer to your questions: NO
The tax laws will never be changed as long as there are greedy / lazy motherfuckers who are envious of the rich and the money they have
Instead of working for it, those lazy assholes rather tax the rich to death to 'level the playing field' --- meaning, making everybody as poor as they are
We live in a fucked up country with too many fucked up greedy assholes
Because the only pressure they had was their own sense of greed.
Which is exactly why the Bush administration made an appearance before the Democrat-controlled congress and warned them of the consequences of congress's pushing Fannie Mae to continue to underwrite (and to essentially REQUIRE underwritten banks to provide) things like no-income-proof, no-down-payment mortgages to people who couldn't possibly afford them once their rates ballooned. That Clinton-era policy, of putting more people into home ownership no matter what, started that bubble growing, and the congress under Pelosi and Reid kept pouring gas on that smoldering fire. The Bush administration spent six years trying to push through Fannie/Freddie control measures, and repeatedly warned congress about the problems and the dire consequences.
People selling derivatives around that mountain of unsecured, bloated housing debt didn't cause people to lose houses and banks to put the brakes on dishing out more credit. People lost houses because their income couldn't keep up with foolishly chosen mortgages, and because they had speculated on the prospect of a get-rich-quick turn around on the house in the near future, they owed more on those houses than they were really worth. It's not exactly mysterious. The banks got stuck with enormous piles of worthless debt, and houses it cost more to foreclose on than were often worth the trouble.
Don't disappoint your bird dog. Go to the range.
Even President Obama admitted that cutting the capital gains tax rate would increase total revenue to the Federal Government.
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
Even President Obama [yahoo.com] admitted that cutting the capital gains tax rate would increase total revenue to the Federal Government.
Most discussions about cutting taxes to increase tax revenues deals with income tax and not the capital gains tax. I don't have a problem lowering the capital gains tax. What the government should do is close the carry interest loop hole that hedge fund managers use to pay themselves after sucking equity from healthy companies and leaving behind debt-ridden corporate zombies.
I hope a hostile government seizes all of their profits heheheehehehee
Unless you are very, very wealthy (part of that 1% you mentioned) then you don't own enough shares to prevent your vote from being drowned out by the major stockholders. And if you're part of 45% (at least, depends on how you run the numbers) you don't own any stock. Hell, 66% of Americans live paycheck to paycheck, so I'm guessing there's not a lot of stock buying going on there unless you're one of those twats that counts a 401k as 'owning' stock.
Here's the thing: Yes, we should work to enact change. No, stock ownership isn't going to make a damn bit of difference. Vote, make your friends and family vote. Favor mandatory voting and finally vote left.
Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
Pocketing overseas earned? profits outside the US was a brilliant way to make the USA #1 for many decades; compounded.
The EU never got a whiff of high tech or IP revenue streams Under taxation treaties this money cannot be repatriated back to USA at anything other than normal taxation rate.Else thr EU will see red. Stupid EU.
Unfortunately "The Public" has been conditioned to ignore such information.
As in: "everybody knows that the most affluent companies are successfully using tax loopholes to avoid paying large amounts of tax", but "The public" has been trained to respond with gems like: "It's 'legal' so it's Ok.", "You'll always lose out aagainst 'The Market'" and "Better the money stays with industry than 'Da Gubbamint', and "We don't want Big Government" and "It's da pooh - lie - tishuns what dunnit".
And other gems of coherent well-informed thinking.
The only thing "people in power" need to hide is repeated ("The Public has a short memory") authenticated videos ("The Public doesn't read") of themselves conspiring in the clearest, bluntest terms imaginable (or The Public won't catch on), to intentionally ("to The Public mere self-serving greed is Ok), illegally and maliciously deprive "The Public" of their rights.
Now that's a pretty low bar to pass, don't you think?
We'[ve had half a century of investigative journalism to tell us about ethical standards in commerce, the way industry can purchase influence, the way in which (i.m.h.o. especially Conservatives) have paved the way for the fullest expression of industry interests in politics and uncounted economic, legal, sociological, and political studies to underpin this and its effects.
What The Public need (in order to catch on) is politics in the form of a reality show. Like errm ... a Trump interview?
These companies might pay taxes to oversea countries when they extract their money to the US. So it might make sense keep it oversea.
A third of cash held by non-financial corporations is not a third of cash. It's not even a third of corporate cash. Learn to read, you freaking nerds. Love, Legal.Troll.
I bet their accountants are killing themselves over how much inflation costs them each year alone.
That's not true at all.
Apple just put $1B of that into Didi Chuxing, the Chinese "Uber" equivalent.
They do plenty with the money. The problem is that, if they wanted to spend it in the U.S., for example, building a factory, the government would tax it again as U.S. income, even though it's already been taxed outside the U.S..
The government is literally paying them to make foreign investments instead of U.S. investments by attempting to engage in dual taxation.
Which is exactly why the Bush administration made an appearance before the Democrat-controlled congress and warned them of the consequences of congress's pushing Fannie Mae to continue to underwrite (and to essentially REQUIRE underwritten banks to provide) things like no-income-proof, no-down-payment mortgages to people who couldn't possibly afford them once their rates ballooned. That Clinton-era policy, of putting more people into home ownership no matter what, started that bubble growing, and the congress under Pelosi and Reid kept pouring gas on that smoldering fire. The Bush administration spent six years trying to push through Fannie/Freddie control measures, and repeatedly warned congress about the problems and the dire consequences.
The same Bush administration that was championing the ownership economy to justify his tax cuts? The same Bush administration with a Zero downpayment initiative?
Where's the Bush-era policy of correcting the housing bubble? Where's the Bush-era policy of warning about an unsound economy? He had enough States of the Union to do it. It took him until 2008? And even then, he doesn't mention anything about holding Banks responsible for their misdeeds.
No, no, with you, it's always Democrats, always Democrats, who are to blame when it comes to anything wrong. That's your consistent approach. You even try to excuse George W. Bush, because Democrats controlled Congress?
Well, in that case, who controls Congress now? Why haven't they fixed anything? Why haven't they done the job you want done? Where's their plans?
People selling derivatives around that mountain of unsecured, bloated housing debt didn't cause people to lose houses and banks to put the brakes on dishing out more credit. People lost houses because their income couldn't keep up with foolishly chosen mortgages, and because they had speculated on the prospect of a get-rich-quick turn around on the house in the near future, they owed more on those houses than they were really worth. It's not exactly mysterious.
People selling derivatives that were bogus were trying to get themselves rich, not serve anybody other than themselves. People who bought a mortgage, sold to them by the lender at the bank, weren't exactly given fair and upfront information about it. People who bought a house, and wanted to make payments, were suddenly asked to compensate for the bank's risk-taking, not their own. It's not exactly mysterious.
Eventually somebody had to place the wrong bets, and when it did, the whole house of cards started to tumble down.
The banks got stuck with enormous piles of worthless debt, and houses it cost more to foreclose on than were often worth the trouble.
Nope, the banks made sure the rest of us got suck with piles of their manufactured worthless debt, and deliberately engaged in foreclosure processes that were reckless, at best, haphazard at worst.
Exactly why you can't hold them responsible, I don't know.
The responsibility it to the shareholder, no the government.
Here I thought the responsibility of the tax code was to the voters.
Ahahaha. The US tax code is and has always been for the benefit of the moneylenders.
Let's be clear. They paid taxes on this money. THis was money earned by selling products in other countries using employees in other countries; the transaction never took place on US soil.
The "tax" they're avoiding is a double-tax on profits by the US code. The way repatriation works is you can only deduct foreign taxes paid from your income, which means you are effectively double taxed. Here's how it works.
Company A sells products in Ireland and the US. Ireland's tax rate is 10% and the US' tax rate is 35%. A sells a product with $1,000 profit. THey pay $350 in taxes and keep $650 as retained earnings. Then they sell a product in Ireland and earn $1,000 in profit. They pay $100 to the Irish government and keep $900 in earnings. Again, the entire transaction happened in Ireland, and they paid income tax on it. So now they attempt to bring the $900 back to the US. That $900 is hit with a 35% tax, so they have to pay $315 to the US allowing them to retain only $585 in earnings. So this creates a situation where Company A now has a choice: leave $900 in their Irish bank accounts which adds to their balance sheets and increases the value of their shareholders, or bring the money to the US and take a massive devaluation to their company, hurting their shareholders.
Companies are purely amoral. They operate in what's the best interests of their balance sheets period. The tax system in the US builds an incentive structure for them to keep the money overseas as that's better for their balance sheets than it is for them to bring it here and invest in expanding US operations.
In this whole situation, there's no win. The government cannot force them to bring the money here, and they cannot dip into the bank accounts of another country to take money they think they're owed. The countries where this money is being held are not going to cooperate because that money is sitting in their bank accounts, creating deposits in foreign banks they can lend on and adding liquidity to their systems; if the money were to leave those countries it would hurt their financial systems. The US Government is acting like a bunch of morons because these articles keep coming out complaining about the situation but nothing is going to change because no country or company is incentivized to do differently. What the government should do is do a tax holiday; drop the rate to 5% if they repatriate for one day. With $1.2 trillion overseas, that would result in at most $60B in tax revenue in one day and around $1.1 trillion flooding the US capital markets. Those companies would then release some as dividends, set up venture arms and do M&A to buy up companies or invest in new ones (all 5 companies listed do this regularly), all of which would create more tax revenue through dividend taxes while setting up more companies and businesses creating growth.
But the government is not incentivized to do this either. If they do, they'll be seen as making a "tax cut for the rich and corporations" and will get hammered in the polls and the next election. So instead they create an appearance of the corporations being the bad guy but they're trying to fight these "evil tax dodgers" which enrages the voter populace and gets them to vote for the politicians who are "fighting these evil corps", keeping those politicians in office. No one including the government wants this money to come back here, all to the detriment of the average citizen.
The big five (Apple, etc) hold roughly 500 billion overseas, not quite Chines government numbers (2,000-4,000 billion) but still significant. How is it invested? Some of the choices are T Bills, TIPS, Euro Bonds, gold and commodities. The companies may be investing the money in ways that meet a number of U.S. government goals (keeping interest rates low, stabilizing markets, supporting weak governments). If so there is more to this story than the usual conflicting "Make them pay taxes" versus "Let them bring it home at a new, low tax rate".
If anyone has any information on how the cash horde is deployed, please post it.
A companies worth doesn't mean they are sitting on the money. If a tech company is sitting on the money they will go out of business fast.
2001
April: The Administration's FY02 budget declares that the size of Fannie Mae and Freddie Mac is "a potential problem," because "financial trouble of a large GSE could cause strong repercussions in financial markets, affecting Federally insured entities and economic activity." (2002 Budget Analytic Perspectives, pg. 142)
2002
May: The Office of Management and Budget (OMB) calls for the disclosure and corporate governance principles contained in the President's 10-point plan for corporate responsibility to apply to Fannie Mae and Freddie Mac. (OMB Prompt Letter to OFHEO, 5/29/02)
2003
February: The Office of Federal Housing Enterprise Oversight (OFHEO) releases a report explaining that unexpected problems at a GSE could immediately spread into financial sectors beyond the housing market.
September: Then-Treasury Secretary John Snow testifies before the House Financial Services Committee to recommend that Congress enact "legislation to create a new Federal agency to regulate and supervise the financial activities of our housing-related government sponsored enterprises" and set prudent and appropriate minimum capital adequacy requirements.
September: Then-House Financial Services Committee Ranking Member Barney Frank (D-MA) strongly disagrees with the Administration's assessment, saying "these two entities – Fannie Mae and Freddie Mac – are not facing any kind of financial crisis The more people exaggerate these problems, the more pressure there is on these companies, the less we will see in terms of affordable housing." (Stephen Labaton, "New Agency Proposed To Oversee Freddie Mac And Fannie Mae," The New York Times, 9/11/03)
October: Senator Thomas Carper (D-DE) refuses to acknowledge any necessity for GSE reforms, saying "if it ain't broke, don't fix it." (Sen. Carper, Hearing of Senate Committee on Banking, Housing, and Urban Affairs, 10/16/03)
November: Then-Council of the Economic Advisers (CEA) Chairman Greg Mankiw explains that any "legislation to reform GSE regulation should empower the new regulator with sufficient strength and credibility to reduce systemic risk." To reduce the potential for systemic instability, the regulator would have "broad authority to set both risk-based and minimum capital standards" and "receivership powers necessary to wind down the affairs of a troubled GSE." (N. Gregory Mankiw, Remarks At The Conference Of State Bank Supervisors State Banking Summit And Leadership, 11/6/03)
2004
February: The President's FY05 Budget again highlights the risk posed by the explosive growth of the GSEs and their low levels of required capital and calls for creation of a new, world-class regulator: "The Administration has determined that the safety and soundness regulators of the housing GSEs lack sufficient power and stature to meet their responsibilities, and therefore should be replaced with a new strengthened regulator." (2005 Budget Analytic Perspectives, pg. 83)
February: Then-CEA Chairman Mankiw cautions Congress to "not take [the financial market's] strength for granted." Again, the call from the Administration was to reduce this risk by "ensuring that the housing GSEs are overseen by an effective regulator." (N. Gregory Mankiw, Op-Ed, "Keeping Fannie And Freddie's House In Order," Financial Times, 2/24/04)
April: Rep. Frank ignores the warnings, accusing the Administration of creating an "artificial issue." At a speech to the Mortgage Bankers Association conference, Rep. Frank said "people tend to pay their mortgages. I don't think we are in any remote danger here. This focus on receivership, I think, is intended to create fears that aren't there." ("Frank: GSE Failure A Phony Issue," American Banker, 4/21/04)
June: Then-Treasury Deputy Secretary Samuel Bodman spotlights the risk posed by the GSEs and calls for reform, saying "We do not have a world-class system of supervision of the housing government sponsored enterprises (GSEs
Don't disappoint your bird dog. Go to the range.
The boards and executives can rot in 8x10 cells until they pay taxes on their profits? How's that for an incentive?
Rule 35 of the internet: "If it can be hacked, it will be". - Charles Stross
So how does that fact force global companies to repatriate profits? It doesn't.
Not yet.
You leftists don't think clearly.
What makes you think I'm a leftist? I pointed out a long-term trend that politicians have avoided talking about for decades. Ever noticed when politicians talk about budget proposals, the forecast is for the next 10 years but never 20 or 30 years out? As 2030 comes closer and closer, the numbers will get bleaker and the choices will get harder. Both liberal and conservatives will struggle with this issue. This can got kicked down the road since the 1980's — and the road is coming to an abrupt end.
I think you need to talk about all Federal taxes together. Income tax, capital gains tax, social security, tariffs... They all have an impact on the GDP growth of the country. And if Hauser's law continues to hold (over the long term - on a decade or more basis - it's been quite accurate) then the best way to increase revenues is to increase GDP growth.
The OECD has a report that deals with taxation and GDP growth, and their conclusion is that lowering high marginal tax rates (and our corporate tax rate is the highest in the world) helps grow the GDP considerably. That would mean an increase in total Federal revenues - and we've seen that manifest and confirmed by President Obama for at least capital gains taxes.
President Reagan dramatically slashed the top tax rates and many have said we paid a steep price for it. However, looking at the actual Federal receipts as a percent of GDP (where we would see if the cuts stimulated the economy enough to offset revenue) we see that the average Federal take was higher for the 1980s than any decade since WWII. President Clinton kept the tax rates pretty low, and we see that the Federal receipts continued to increase.
I would argue that we try for a flatter, simpler, lower tax rate but with fewer deductions. Many point to the 1950s/1960s as our "golden years" when the top statutory rate was 90%! But at the same time, the Federal Government, per capita and adjusted for inflation, was taking in HALF what it does today. Those top statutory tax rates were fantasies because of the deductions allowed. The actual, effective tax rates people paid in the 1950s and 1960s was half what they pay today.
Personally, I'd cut it down to a single personal income tax rate: 15%. And it's a flat rate, paid by everyone on every penny of earned income. No deductions, not adjustments, not exclusions. EVERYONE pays. The current average tax rate for all earners is 13%; this 15% actually represents a tax increase for everyone, on average. And I would completely eliminate the corporate tax rate - set it to zero for all US domiciled and based companies. The catch: to qualify as US domiciled and based, at least 75% of all worldwide corporate profits must be repatriated to the US, and at least 51% of all executives at the VP level and higher - as well as 51% of all board members - must reside within the US for at least 183 days a year (meaning they are subject to US taxation). That would not only bring back the trillions held overseas (for investment in the US) it would make the US the world's greatest tax haven. And there would be a flood of upper-income earners (those execs) who would necessarily pay 15% of their income to the Federal Government.
I would also raise our tariffs and simplify - a flat 5% on all goods imported. Historically our tariffs have been a lot higher - dropping below 5% only after 1975. Simplifying the tariffs, and leveling them across all industries (they vary all over the place now) would make doing business easier, and it may drive out some industries in the US. However it would also greatly expand many industries, such as high tech. Right now China has a 4% export tariff on high tech goods, and the US has a ~1% import tax on those same goods. Raising the tariff on electronics, and combining it with the tax advantages of being based in the US (no taxation) would definitely give many companies a reason to relocate their assembly factories to the US. Google built the Moto X in the US for about the same labor cost as an iPhone in China. Costs stay about the same, tariffs are lower (hence selling price becomes more competitive) and profits taxation is gone (zero corporate income tax) and there is a VERY compelling argument to move manufacturing back domestically.
Anyw
Browsing at +1 - no ACs, I ignore their posts. So refreshing!
You mean you present a defensive piece produced by the Bush White House? You don't source it, but it comes from the Office of the Press Secretary. Which reveals a lot about its character and purpose. Notice the focus on blaming others for stopping any reforms? What a surprise that it serves to castigate others in an attempt at exoneration of the President. It doesn't even name a single other Republican politician, which says a lot about the partisan nature of it as well. Why not?
Where's mention of Bush's lack of support for bank regulation? Where's mention of his support for zero-downpayment mortgages? I don't even see one mention of checking to make sure banks and other financial institutions were actually being honest when dealing with Fannie Mae and Freddie Mac. Why not do that? Why only talking about how "If only we'd regulated the GSEs, this would never have happened!" and no calling out of the banks on their own deliberate crimes that they committed to enrich themselves? It's a conspicuous silence.
Because it's not meant to be a true picture, but present what they wanted to say.
Look, you want to show me Bush had a defensive piece written where they cherry-picked the things they wanted to pull from others, while ignoring their own mistakes? What a surprise.
That's what your quoted material is.
But at least admit who produced it. You certainly didn't write it up yourself.
Show me George W. Bush taking responsibility, that'll be more believable.
And none of it will mean the banks did not choose to lie when they created their MBSs, when they pursued their foreclosures, and when they took the government's money. For their own profits.
Wells Fargo, admitted to the fraud. Countrywide was convicted. Others as well.
They chose their own behavior, they weren't forced, the government did not hold any guns to their heads forcing them to lie. They knew what they were doing, and why.
Just like you chose not to source your material. Was that oversight, or did you realize how it would look?
There are two now, HP Enterprise and HP. Yet I'm not surprised of them hording cash while at the same time laying off 30,000+ employees; which I was one of. Pisses me off, but there's not much I can do about it. Voting does little good, nothing will stop the march of the multi-nationals quest for shareholder value at the expense of long-term viability.
Not just Google, but also Donald Trump. I think Trump addressed this issue in his tax plan press conference? Check out the video below (which is a link to the direct moment he mentions this issue):
link: https://youtu.be/Lom9mPITxOo?t=4m19s
title:" Full Press Conference: Donald Trump Unveils His Tax Plan (9-28-15) "
publisher: Right Side Broadcasting
date posted: September 28, 2015
view count: 120, 657 views (very few)
in which Trump describes his plan for business taxes:
His tax plan can be found at https://www.donaldjtrump.com/positions/tax-reform, which states the following:
Problem is to get rid of bogus places like Caymans, Cook Islands, Panama, etc., who are simply whores to the billionaires. No reason for REAL countries to make their tax policies ape the pirates and clowns in tax havens. Send in the Marines....
With the French government raid on Google offices today it appears that they are most definitely being accused of breaking existing laws and evidence is being gathered to bring it to court.
Whether they are guilty of outright tax evasion remains to be seen but there are definitely a lot of accusations of illegal activity.