The New York Times published a disturbing article yesterday about how giant, multinational corporations are robbing the U.S. treasury (and people) by exploit tax loopholes and the political clout to obtain them. The marquee revelation in the article is that General Electric, who made $14 billion dollars worldwide last year ($5 billion domestically), paid ZERO dollars in taxes.
“Its extraordinary success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. […]
Although the top corporate tax rate in the United States is 35 percent, one of the highest in the world, companies have been increasingly using a maze of shelters, tax credits and subsidies to pay far less. […]
Such strategies, as well as changes in tax laws that encouraged some businesses and professionals to file as individuals, have pushed down the corporate share of the nation’s tax receipts – from 30 percent of all federal revenue in the mid-1950s to 6.6 percent in 2009.”
This really doesn’t qualify as a press-stopping scoop. The trend toward corporate domination of our nation’s economy and politics has been evident for decades. Their success in wrangling beneficial treatment from Congress and the courts (i.e. Citizens United) through adept distribution of cash and favors has been decried in liberal circles repeatedly. But the effect of that criticism was itself suppressed by more corporate cash raining down on Tea Partiers, who have been exploited by AstroTurf inventions like Americans for Prosperity and FreedomWorks, to demonstrate against their own interests. Thanks, Koch brothers.
Nevertheless, it is good to see a mainstream media source shining a light on this repugnant unfairness orchestrated by wealthy special interests and their benefactors. However, there is a surreal quality to the reaction in the press to this article. Right-wing politicians and pundits are suddenly praising the Times for outing GE. Ordinarily they regard the Times as irremediably biased and unreadable, but if they are attacking another of the right’s favorite foes they are considered sufficiently rehabilitated and trustworthy.
The most surreal response to this is the one emanating from Fox News. They have glommed unto this story like a shark on virgin surfer.
There were several reports on their daytime broadcasts. It was featured on their Fox Nation web site. And Bill O’Reilly devoted a segment to it complete with his trademark bluster and animosity toward his long-time nemesis GE and CEO Jeffrey Immelt, whom he has called “a despicable human being.”
O’Reilly: Last year General Electric made 14 billion in profit worldwide, including $5 billion in profit in the USA. Yet General Electric paid zero – nothing – in taxes to the feds. As you know GE boss Jeffrey Immelt – big supporter of President Obama, and vice versa. So the question is how could GE pay absolutely nothing to the government, and how could I get that deal?
Unsaid in all of this is that Fox News’ parent company, News Corp, did get that deal. As I reported earlier this week, there was another Times article a few years ago that revealed that…
“By taking advantage of a provision in the law that allows expanding companies like Mr. Murdoch’s to defer taxes to future years, the News Corporation paid no federal taxes in two of the last four years, and in the other two it paid only a fraction of what it otherwise would have owed. During that time, Securities and Exchange Commission records show, the News Corporation’s domestic pretax profits topped $9.4 billion.”
So the company that employs O’Reilly is banking almost twice the domestic profits of GE and paying nothing in taxes, yet they are the ones throwing tantrums and lobbing insults. This is the sort of behavior for which the word hypocrisy was coined.
I have no problem with Fox flogging GE over this issue, which is an important one that involves many more corporate scoundrels and deserves more attention. But it would have been nice if they could have at least acknowledged that they are engaging in the very same tax shenanigans as GE. However that would have required them to be an honest news provider, which is contrary to their mission.
[Update 3/28/11:] And finally there is some media attention on the fact that there are many U.S. corporations brazenly shortchanging the country. MSNBC via Daily Beast.
Are you following this, boys and girls? Apparently, Mark was expecting that Fox News would either ignore this story about GE paying no taxes, or they would be congratulating GE. And since neither of those things took place, Mark is still trying to spin this into a Fox-News-sucks screed. The logic here is non-existent.
I for one would like to know how you came to that conclusion, the way I see it the author is AGAINST companies exploiting tax loopholes and not having to pay taxes. In fact this is something that not just GE, but many other corporations including Fox news, are indulging in, which makes it hypocritical when Fox singles out GE and calls it to the carpet for just this.
The author points this out clearly in the last paragraph that he was not against the issue of companies avoiding paying taxes decried on mainstream media, but rather that they are being hypocritical in doing so because they too engage in the very same behaviour.
As the saying goes, “people living in glass houses shuldn’t throw stones” and yet that’s exactly what seems to be happening here. The author is right in saying this is hypocritical because it is!
I’m afraid I can’t quite follow what you are getting at, which part of this is spin exactly?
“I’m afraid I can’t quite follow what you are getting at.”
You’re not alone. Scott’s comment is incomprehensible. I was not expecting Fox to ignore the story. Nor was I expecting them to celebrate it. But that’s as far as Scott’s brain can venture. He is unable to consider the notion that Fox should have been honest and disclosed the fact that News Corp did the same thing as GE.
Exactly! It’s not that it is not a story that should be reported on by Fox, they actually did there job but we did not get full disclosure from them being guilty of the same. I am assumming what they both did was not illegal, though it is I believe immoral, it’s the fact Fox made such a big deal about something they themselves do! If they aren’t going to fully disclose maybe they shouldn’t report on it. They have to know they will get called out by someone, but they don’t care.
“…the author is against companies exploiting tax loopholes…”
Correct. And so is Bill O’Reilly, Lou Dobbs, John Stossel, etc.
You’re point?
Your….typo+autocorrect=shitty grammar.
If Bill O’Reilly et al are against it, then why do they only complain when GE does it? It’s dishonest to slam others for something you are doing yourself.
Kudos to them then, however that still doesn’t answer my question, where is the spin in this article? I can’t seem to find it so I’m hoping you’ll point it out to me.
The author was against THE HYPOCRISY that was mentioned in the article, and that I’ve highlighted in my first post. Have any of the people you listed above come on air and acknowledged that Fox hasn’t been paying taxes either (for that matter, have Rupert Murdoch and Roger Ailes admitted/commented to/on this?)? If none of them have, then they aren’t quite in the position to be calling GE over the coals without being factulally labeled as hypocrites themselves. Which will mean the author was correct in pointing the hypocrisy out.
So Scott, what you’re saying is that you didn’t read this story on which you are commenting? Mark’s post in one sentence: Fox News anchors are outraged that GE paid no income tax on at least five billion dollars in net income while their employer did the exact same thing.
What is so hard to understand?
I don’t think logic is what he thinks it means.
Fox “News” only complains about GE (and ONLY about GE) because GE still owns 49% of NBC and therefore 49% of MSNBC. Let’s see if this faux outrage extends to any corporations other than GE that skate on their taxes.
Based on facts presented here I’m trying to find the logic that Fox News/ News Corp is being hypocritical.
GE paid no taxes in 2010, nor will they ever pay these taxes. In the body of the article here it clearly states that an expanding company like News Corp can under the law “Defer” paying taxes to future years. Correct me if I’m wrong, but defer means that taxes will be paid on all News Corp profits, but are only deferred and paided in later years versus not at all. See the difference?? Maybe not since this point was not placed in bold print.
GE’s CEO Jeffrey Immelt is a regular in the Obama White House, and was appointed by Obama to sit on an energy advisory panel, so he doesn’t even need to bother sending lobbyist when he can do it himself. Anybody want to cry foul?? For their part, G.E. officials “say that these measures are necessary for G.E. to compete against global rivals.”
I correct myself on the advisory board that Immelt sits on. Obama appointed Immelt to the new head of his Economic Advisory Panel.
GE is a proponent taxing carbon via Cap & Trade legislation, and GE averages 2.3 federal energy grants per month for alternative energy subsidies. GE invested an average of $19.5 million each year from 2000-2010 not in creating affordable energy, but in lobbying the government for more subsidies, and received $300 million in grants from 2000-2010. Plus, Immelt “traveled with the President” to India in November 2010 when GE announced a $750 million order from India’s Reliance Power for GE steam turbines.