Those who have more are bucking the system and laughing all the way to the bank.
“I hope we shall… crush in its birth the aristocracy of our moneyed corporations which dare already to challenge our government in a trial of strength, and bid defiance to the laws of our country.” – Thomas Jefferson, 1816
The experience that Thomas Jefferson and other early colonials had with chartered corporations of the British crown and their monopolistic grants inferred to them left many in the newly formed democracy with acrimonious feelings. To men like Jefferson they were objects of greed that sought to expand their commercial enterprises beyond their charter’s grant. This proved prophetic as corporate personhood proponents pushed their agenda through the courts in the 19th and 20th century; culminating in a status beyond most people’s wildest expectations in Citizens United vs. FEC just last year.
In that case the conservative majority in a 5-4 decision went beyond the actual merits of the case and declared that money was equal to speech and no entity could be prevented from spending on political campaigns. This was a major departure from 100 years of legal precedent. For all intents and purposes corporations now have virtually the same rights as citizens but without some of the responsibilities in areas that can ultimately create the monopolistic authority that many of the earlier colonials had dreaded.
Though there are efforts to undo what the Roberts court has created, it is likely that this monster will never be completely put back in its container and we will have to deal with it at every point where it’s practices become corrupt. No matter what the outcome of these efforts are we should perhaps address our concerns with the current status of corporations as “citizens” by keeping them under the spotlight and expose their abuses when they occur.
We should start with a practice that has been around for quite a while now and go after their legalized theft of depriving the U.S. treasury its due revenue from business taxes. One of the most recent examples of this is where G.E., the largest corporation in this country, made some $10.3 billion in profits last year and paid zero dollars in taxes. They were able to achieve this through the zealous efforts of their pawn’s in Congress who have enacted legislation enabling corporations to move their money to offshore and foreign accounts where corporate profits were immune from the laws of the land.
In fact, many of the loopholes that enable corporations to eschew their fair share of taxes negate the oft heard whine by proponents that the U.S. has the largest corporate tax than nearly every other country around the world. The rate is high at 35% but is seldom realized because of such loopholes that in effect create lower tax rates than many working families pay. To pour salt into this wound, many corporations are also subsidized with federal funds as a part of other legislation that allows them to circumvent using their profits to reinvest in their business and instead often goes to their bottom line in the form of bigger dividends for shareholders and large bonuses for CEOs and other upper management personnel.
Staying with the G.E. model, this multinational conglomerate receives 2 – 3 federal energy grants every month which has totaled over $300 million in the first decade of this century. Subsidies during this period amount to $5.38 billion. Furthermore, they spent $19.5 million lobbying the government for more subsidies while posting more than $2.94 Billion in net profits for the fourth quarter of 2010 alone. And just when you thought it couldn’t get any worse, it turns out G.E. doesn’t even create U.S. manufacturing jobs because all products G.E. makes are manufactured abroad in cheaper labor markets.
Exxon-Mobil who made higher profits last year than they or any other corporation has ever made, contributed NOTHING to the U.S. treasury in business taxes by virtue of their offshore shells that allow them to evade their responsibility to help pay for the physical and intellectual infrastructure this country requires to remain competitive with world markets. In fact, a study by the investigative arm of the U.S. Congress, the Government Accountability Office showed that two-thirds of all U.S. corporations paid no taxes from 1998 to 2005. (SOURCE)
Pat Garafalo with Think Progress’s Wonk Room reported back in April 2009 that major U.S. corporations were able to have their effective tax rate lowered so significantly that over $100 billion dollars in needed revenue passed to real citizens in this country and at a time when many were losing their jobs and their homes. For all of the ranting and raving about the high tax rate U.S. companies have to pay, the legislation passed by corporate friendly legislators in Washington saw companies like G.E. obligated to pay taxes at only a 5.5% rate; a rate considerably lower than the 20-25% rate many real people pay who make less than $100,000 a year. (Corporations Lowering Their Tax Rate More Than 20 Points Due To Offshore Deferral by Pat Garafalo, The Wonk Room, 4/22/09)
In their zeal to regain the America they feel they have lost, Tea Party candidates have attacked public welfare spending to lower the deficit but have ignored the much larger corporate welfare that burdens this country. As citizens we are obligated to pay our fair share of taxes. Without taxes to pay for essentials that encourage business and promote the general welfare of its citizens, this country would come to grinding halt. Yet it is the real people of this country who are left footing the bill for not only this but getting stuck with the tab for bailing out a crooked financial system while their friends in high places turn a blind eye to the abuses they have helped create.
How much more will the average working family tolerate before they fully grasp that those who cry the loudest about taxation are the least likely to have the best interests of this country at heart?
- Edward D. Kleinbard: The Global Tax Avoidance Dance (huffingtonpost.com)
- Governments Don’t Overspend, Corporations Don’t Pay (jibarosoy.wordpress.com)
- How Unfair Tax Breaks Benefit the Richest Americans(UFE)