One of the caricatures made of us progressives is that WE have a caricature of the Vast, Evil Corporation. And it is easy to fall into thinking and talking that way, what with all the destructive ways that corporate behavior affects us all every day. But we have to remember corporations only do what they are supposed to do, what they’re required to do – make money for their shareholders. Until such century as we can amend the Constitution with a corporate bill of social responsibilities, the best we can do is regulate the hell out of them, and enforce those regulations.
Otherwise it’s only natural and to be expected that we’ll keep seeing our friendly corporations:
- funding deceptive studies to avoid taxes and regulations;
- funding politicians’ careers to avoid taxes and regulations;
- employing armies of lobbyists to remind those politicians who’s in charge;
- funding our favorite TV shows with their lying and manipulative ads;
- happily paying relatively small fines for their misdeeds as a cost of doing business;
- devoting teensy percentages of their budgets to feelgood causes to soften their images;
- and working every loophole possible to minimize their tax liability.
Oh, did I mention yet that Exxon Mobil, which this year made $19 BILLION in profits (out of over a QUARTER-TRILLION revenue) paid NO taxes to the United States government? While you paid… how much?
Although Exxon paid $15 billion to foreign governments, they managed the feat of contributing nothing to their own country, through the ingenious use of various loopholes, particularly the twenty wholly-owned subsidiaries in Bermuda, the Bahamas and Cayman Islands that legally shelter their cash flow.
President Obama (who is neither at the top nor the bottom of the list of politicians I trust right now) is reportedly trying to close many of these loopholes, but could use our encouragement as he negotiates an ocean of silver-tongued lobbyists.
Right now I’m more concerned about our own Bleeding State of California, which is the only oil-producing state in the nation that lacks an oil-extraction fee to help with its education and infrastructure needs.
So I propose not sending anyone to Sacramento this year who won’t commit to supporting AB 656. Candidates for assembly & senate who will support this vital bill include (and I will update) :
- Phu Nguyen, 68th AD
- Melissa Fox, 70th AD
- (incumbent) Jose Solorio, 69th AD
- Rosalind Freeman, 67th AD
- Gila Jones, 38th Senate District
- I will update with any others who notify me.
Gubernatorial candidates who would sign AB 656 are limited to Jerry Brown, and the Green candidate Laura Wells. Let’s do this thing in November, and bring our state back to fiscal health by making the oil companies pay their fair share! And if you want to argue that this will cost us at the pump, I’ll argue with you, but short answer it won’t.
UPDATE: Exxon is disputing the Forbes and Mother Jones articles I linked to, claiming that they will eventually end up owing some Federal taxes for 2009, but they refuse to say how much. And this claim is contradicted by the following “10K report” they released to their shareholders which those stories were based on. Can you say “obfuscation?”
We do know that they:
- Limit their US tax liability “with the help of 20 wholly-owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands that (legally) shelter the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi;”
- Bragged to their shareholders of no US tax liability until this story hit the press and caused an uproar, and still refuse to answer in any detail;
- Stand in sharp contrast to other Fortune 100 companies, such as Walmart, the only company bigger than them, who actually made less profits last year, but paid 5.9 billion in income taxes to Uncle Sam;
- Paid out plenty in taxes to other foreign governments – 15$ billion globally.
Until Exxon is more forthcoming, this story stands.
Ah… Vern the corporatist. Well, since nobody has posted any comments to this shakedown for more taxation, I might as well.
See, corporations don’t pay taxes. They collect them. If corporations don’t pay taxes to the federal government that is a very good thing.
Every time you buy a gallon of gas from Exxon, you pay over 18 cents a gallon to the federal government. State, local and federal taxes are a much bigger windfall to government than the profit oil companies make on that gallon of gasoline (about a half a cent). You are already paying gasoline taxes to the federal government, believe me. If you buy this, you are simply arguing you want to pay MORE.
And every dollar that goes to the government is actually a dollar taken OUT of the GDP. And it is a dollar, 25 cents of which is spent by the government in its very collecting, that is mostly spent on things which people who ACTUALLY PAY FEDERAL INCOME TAXES don’t even receive. Redistributed income, that is.
So who is this article aimed at? Not the bottom 50% of wage earners in this country. They receive tax BACK from the government. They think their taxes are “just right”. So Vern is trying to tell the upper 50% of California wage earners that they should “feel envious” that Exxon didnt pay any taxes.
Why? So their gasoline can be more expensive?
Or he’s trying to tell the bottom 50% they don’t pay enough for gasoline.
Go ahead Vern, try that argument out for size.
See, what should be known is: rather than trying to sell you that you are part of the government class, you really are part of the corporation.
You, the citizen.
The government class works and arranges laws to exclude itself that the rest of have to live by. They arrange benefits the rest of us cannot buy. All at a cost to us. And procured by FORCE.
The corporation, on the other hand, really is you and me. Its your 401K, and the dividends that supplement your grandparents social security. And the corporation can’t MAKE YOU do ANYTHING. You spend money for something you get and something you decide you want, not something you are told you need.
And Vern thinks the government deserves a piece of that after all your hard work. After the government takes an average of 27% of your money in federal, state and local taxes, and fees for everything they can possibly assess, you actually have someone arguing putting MORE money into government.
I mean, he’s not arguing for cutting YOUR taxes if corporations pay more of YOUR money in taxes, is he???
Not only that, but Vern – who TALKS like he opposes corporations and their actions, is actually looking to enlist corporations into being in the business of collecting taxes from you, for the government class.
That is a corporatist, ladies and gentlemen. Plain and simple.
At #1: Terry you state,
“every dollar that goes to the government is actually a dollar taken OUT of the GDP”
My RESPONSE:
Every dollar that goes FROM the government to corporations as a tax CREDIT is a dollar taken out from the American Taxpayer.
1) There is a difference between a tax DEDUCTION and a tax CREDIT.
In other other words, if you have Tax CUTS (deductions) that is LESS money taken in by the government, but a Tax CREDIT is in effect money that has to come from the TAXPAYER.
Generally, a Tax CREDIT results in a dollar for dollar benefit for the recipient. So since corporations RECEIVE tax Credits, every Tax Credit Dollar that goes FROM the government to Corporations, can be interpreted as a dollar taken out FROM THE TAXPAYER.
2) Also, so while this tax CREDIT dollar may be paid by American Taxpayers, to benefit a corporation, in effect we may be subsidizing foreign investors because corporations may have foreign shareholders/ownership and because this TAX CREDIT benefit would flow from the Corporation to its foreign shareholders/owners in a form of a DIVIDEND.
YOU ALSO STATE:
“The corporation, on the other hand, really is you and me. Its your 401K, and the dividends that supplement your grandparents social security.”
MY RESPONSE:
The corporation is NOT really you and me, especially in the case of TAX Shelters, or with corporations avoiding taxes with off-shore shell companies; or with Transfer Pricing differences; or with dividends that go to foreign shareholders.
The corporation has NO legal obligation to share/distribute dividends, except with its shareholders. So, if your grandparents, parents, neighbors are NOT shareholders then they get ZERO to supplement their social security, and which is opposite of what you suggest.
And the corporation is NOT you and me, because you can’t just go to a corporation and take from the corporation’s “piggy” bank as you do with your own “piggy” bank.
YOU ALSO STATE:
“And the corporation can’t MAKE YOU do ANYTHING. You spend money for something you get and something you decide you want, not something you are told you need.”
MY RESPONSE:
That is only partially correct.
Think of Negative Spill-Over effects or Negative Externalities such as pollution.
A company may pollute but it may not be necessarily paying FULLY for the cleaning up or for the ADVERSE effects from pollution. For example, you and I may get sick from the pollution but you can’t necessarily take your Doctor’s/Hospital’s bill to a polluter and have them pay the bills.
So indirectly, Joe or Jane Citizen may be spending money for something they didn’t benefit from, or for something they didn’t decide they wanted.
Same issue with cancers caused by or from tobacco. The cancer sufferer may or may not recover from the manufacturer, and in the case when they recover insufficient amounts or zero amounts, again Joe or Jane Citizen is left paying for the ADVERSE effects of a company’s products. (So indirectly citizens would be FORCED to pay for the adverse effects from a corporation’s operations.)
A balance must be stuck between corporations or individuals having the opportunity to maximize the use of their resources or talents which may result in greater incentives and profits, and between paying through taxes for investments that are necessary for a civil and stable society.
But to indirectly suggest that only TAX CUTS will stimulate growth is not accurate, because some growth requires Investments by not just individual corporations but also by stimulative investment/spending, or tax credits by the government which come from some taxes.
Francisco “Paco” Barragan (My opinions only and not those of any group)
Well, Francisco employs the “moving target” argument of so many on the Left. If you are not on the Left, Francisco, you employ their argument tactics.
The discussion was on taxes paid through the corporations. Taxes YOU pay. Francisco starts out by talking about tax deductions and tax credits. Now, that’s fine. I’m all for eliminating fat cat giveaways. That is not the same thing as “paying taxes”. But if Francisco really believes this about Exxon, he should be prepared to back it up. Because I know, coming from Chevron, that there are many ways in which the oil companies would not be motivated to sell their product at the marginal profit rate in areas of the United States, without a tax credit. And the US Government, at 18cents a gallon, gets a lot more per gallon than any oil company. So that may not be the best example for him to argue about corporate tax credits.
If one thinks tho, that eliminating those tax shelters, and the mortgage deduction, and other items the Left keep insisting COST money, as if the money was with the government in the first place, won’t change behavior – you have another think coming. I am comfortable with that unimpeded marketplace. Will you be?
Now, the same applies for the “money to foreign investors” line. Confusing to follow, but basically he’s saying if we give a tax break to an international company to do business here, that equals money to foreigners. The xenophobia in that statement is just rampant, one. Two, that’s the interconnected world today. Just seal the borders up tight and never let anything in or out. Because no matter what you buy today, its going its the hands of foreigners as a dividend, somewhere. Three, it really makes no difference. Its about the money collected by YOU the taxpayer. If you are really worried about what that company is doing with its money, then tell the corporations to set up shop in the rest of the world, and leave us alone. Yeah, lets see how you like that world.
Finally, and most exasperating of all, is this “a balance must be struck” business the Left always talks about. A corporation may pollute. There are laws for that. A corporation may raze an entire virgin forest without caring whether or not they plant anything behind them. But the same moralism that Francisco insists needs to be in place is in jeopardy once its enforced by the government. If that corporation couldnt sell its goods after it did that, not another company would try it. And the corporation doesnt care about left or right. It will kiss up to any government, looking for the handouts, looking for the treats. The wall of separation needs to be between government and corporations, not religion. We wouldn’t be half as screwed in this country as we are if government hadn’t been given the power to decide between winners and losers in the first place.
The balance Francisco is talking about is a few powerful Senators and Congressmen lobbying for their states about what that balance ought to be. And the only ones who lose, every time, are the people.
Dont use corporations to gather taxes. Don’t use corporations to “balance” what one person thinks is wrong one year, and balance someone elses needs the next. Favoritism, favoritism, favoritism, corruption, corruption, corruption.
#3 NLE: Grab a bucket of popcorn and watch Frontline’s “Tax Me if you Can!”
but before you do think about this quote:
“Anything that’s not being paid that should be paid, that’s basically what the honest taxpayer is making up,” asserts Charles Rossotti, a [REPUBLICAN BUSINESSMAN] who became [COMMISSIONER] of Internal Revenue in 1997 and spent five years battling bogus shelters. Rossotti estimates that because the government is not collecting all that is owed — the biggest piece of which is illegitimate tax shelters — everyone else is paying 15 percent more than they should.”
Let’s see…Mr. Rossotti…a REPUBLICAN, a BUSINESSMAN, and IRS COMMISSIONER.
Will you also label him as using the “moving targets”, tactics and arguments of the Left?
READ the “INTRODUCTION” and then select “WATCHONLINE”
http://www.pbs.org/wgbh/pages/frontline/shows/tax/etc/synopsis.html
Francisco “Paco” Barragan
One final time. You can’t collect taxes on corporations. You can collect taxes on the dividends of shareholders. You can collect taxes on salaries paid. You can collect taxes on what the corporation sells or does. But collecting taxes on the corporation itself is simply shifting the burden of collecting those taxes from individuals via the government to the corporation in the form of higher prices. In that way, you empower both the business and the government to make deals, offer handouts, “create balance” where someone decides it needs it, and offer all the power to corrupt, absolutely.
Paco in case you don’t know, Crowley and #3 NLE are the same person. Thanks for helping me deal with his sophistry today.
Maybe it’s true that if the US taxed oil companies at the rate that foreign governments evidently do, our prices would go up noticeably at the pump. But that’s not true about my main point in the second half of the article, AB 656, the California bill to institute an oil extraction tax to help fund our education.
An extraction tax here in California – in the only oil-producing state that doesn’t have one – won’t add more than a fraction of a penny to costs at the pump, given what a small fraction California’s oil is on the global market. But it WILL provide Californians with $2 billion annually to help with our desperately underfunded higher education. And as Crowley doesn’t live in California, I’m not interested in his opinion on whether that’s a good trade-off for us. It is.
Again, let me praise former half-term governor Sarah Palin for the one thing I know she did well: make sure the oil companies paid their share to Alaskan citizens. And I’ve never heard anyone blame high gas prices on Sarah Palin.
The mantra seems to be…don’t tax me…but do GIVE ME tax subsidies and tax credits (these are outflows from the govt/American Taxpayer to select and strong industries)…which in our “interconnected world” often times have been deemed to be an illegal action by the WTO.
This is an example of Royalty “relief” below…opposed by some Republicans in the past…but as with most subsidies or credits to certain industries…once a “FREEBY” has been handed out, it is very hard to end it.
“I don’t think there is a single member of Congress who thinks you should get royalty relief at $70 a barrel” for oil, said Representative Richard W. Pombo, [REPUBLICAN] of California and [CHAIRMAN OF THE HOUSE RESOURCES COMMITTEE]…It was Congress’s intent,” Mr. Pombo said in an interview on Friday, “that if oil was at $10 a barrel, there should be royalty relief so companies could have some kind of incentive to invest capital. But at $70 a barrel, don’t expect royalty relief.”
President Bush himself said it best when he stated, “With oil at more than $50 a barrel, by the way, energy companies do not need taxpayers’- funded incentives to explore for oil and gas.”
By the way, Oil closed has been hovering around $80 lately but has substantially exceeded the threshold set by Chairman Pombo ($70) or former President Bush ($50).
http://www.commondreams.org/headlines06/0214-01.htm
I guess Mr. Pombo and Bush 43 are LEFTIST Republicans if they state views contrary to National Libertarian Examiner, or if they proposed removing FREEBIES/SUBSIDIES to very profitable industries such as the oil industry.
Francisco “Paco” Barragan
Vern Nelson you say
“Maybe it’s true that if the US taxed oil companies at the rate that foreign governments evidently do, our prices would go up noticeably at the pump.”
My response:
This would be true if this was the ONLY factor that affected the final price at the pump…Oil prices are affected greatly by a fine interplay between SUPPLY and DEMAND.
1) Think about this…assume that taxes were the same for all countries.
2) And also ask yourself this…Which is currently the largest market? The US.
So domestic and foreign producers would be COMPETING to sell to the largest market or one of the largest markets…and unless they are engaged in PRICE-FIXING they would compete not only on quality, reliable deliveries, lower transportation costs, extraction innovation (to be competitive), lower internal costs from consolidation of in-house shared services (i.e. Accounting; HR; IT; etc) but also on PRICE, otherwise, they would be “PRICED OUT of the market”.
I think that one major thing that could happen is that the INCENTIVE TO CREATE TAX PLANNING Strategies that have no Economic, but only an accounting impact, would be basically eliminated or greatly reduced…Currently, all companies use the different tax rates in different countries and plan to maximize from the differences.
For example, the objective is to SHIFT INCOME to LOW tax countries (to have the highest amount of income taxed at a lower tax rate); and while SHIFTING EXPENSES to HIGH tax countries (to receive the highest amount of TAX DEDUCTION or TAX CREDIT benefits).
Francisco “Paco” Barragan
#3 NLE you state,
“And the US Government, at 18cents a gallon, gets a lot more per gallon than any oil company.”
MY RESPONSE:
Your statement APPEARS FALSE for several reasons
FIRST REASON:
Because at .18 cents the govt collected an expected $24.8 Billion BUT
the top 5 producers had $145 BILLION in PROFITS from about total REVENUES of about $450 Billion:
http://www.calcars.org/calcars-news/928.html (total profits)
http://tonto.eia.doe.gov/ask/gasoline_faqs.asp (total gallons consume)
137,800,000,000 gallons consumed in US in 20008
0.18 tax per gallons
$24,804,000,000 fed tax expected to be paid
.
SECOND REASON:
Additionally, there are Oil Extraction Credits plus other credits that would offset any amounts of taxes paid by the companies. NLE, since you come from CHEVRON do you know what the LEVEL of TOTAL CREDITS to the US Oil industry is?
I have not pinned down that number yet (I was hoping you would know).
#3 you NLE you also state,
“Confusing to follow, but basically he’s saying if we give a tax break to an international company to do business here, that equals money to foreigners. The xenophobia in that statement is just rampant, one. Two, that’s the interconnected world today.”
.
MY RESPONSE:
This is not about Xenophobia but about reality.
The Tax Credit given as a FREEBY to a Corporation comes FROM the AMERICAN Taxpayer…but if corporations are paying ZERO or LOW taxes (and these taxes would be greatly affected or offset by the tax credits), and corporations are foreign owned or with majority foreign shareholders, then the benefit is going to a foreign citizen and not staying here in the US. For example, I worked for a sizable company that had about 85% of its business in the US, but about 90-95% of its shareholders were foreign shareholders.
This is a greater reason for ensuring taxes are paid by the Corporation, and ensuring that after all the Credits, offsets etc that the level of taxes on profits is fair and reasonable.
Francisco “Paco” Barragan
Federal tax burden about 30 years ago = about 75% shouldered by businesses, 25% shouldered by individuals. Federal tax burden now = 75% shouldered by individuals, 25% shouldered by business.
That pretty much tells you all you need to know about the overall taxation trends. Is it any surprise that, concurrent with this trend, that corporation are wielding greater and greater power in our govt.
The price of oil is going up due to supply and demand.
One of the ways to curb usage and encourage the move to alternate energy is to increase the taxes on oil.
This will have several long term results.
1) Theoverall demand for oil will fall resulting in a lower cost for the remaining oil. So taxing now will lower the cost of oil later.
2) It will make alternative energy more competitive.
3) It will reduce our trade imbalance
4) The additional revenue can be used to reduce the deficit of the state and the country. The additionla revenue should be directed to help lower income persons that will be most impacted by the tax and to develope alternative green energy.
This is a win win situation.
Exxon should pay thier fair share.
Wait! I thought corporations were people too!
Which is it? Are they legal persons or not? If they demand (and apparently get) the same rights as individuals, why do they then not have the same obligations?
Oh, I see. Because they are corporations.
Welcome to the rabbit hole.
ww that only works if they are giving money to campaigns, otherwise they are different.
I agree with you however, since they are now individuals then they should pay the same upper tax bracket rate as an individual.
So since the top 5 producers had $145 BILLION in PROFITS they owe the taxpayers about 35% of that or about 50 billion per year.
Someone should file a court case based on the recent supreme court ruling on this individual issue. If it applied to free speech it should apply to taxes.