Sunday, May 26, 2013

This Apple Falls Far From Its Tree

Trey Smith

If you've been following along at home, then you read Friday afternoon's post about the [sort of] legal shenanigans of the corporation -- Apple Computers -- that so-called progressives gush over. It was revealed in said post that Apple is hiding a great deal of their profits in Ireland because the Irish allow them to pay a very meager 2 percent tax on their profits. By hiding their wealth over there, they are depriving the US and many other nations of tax dollars they should be paying.

Well, the story gets even worse. As Richard Eskow writes,
Even though only four percent of its workforce is based in Ireland, and only a small percentage of its profits are earned in that country, Apple recorded 65 percent of its worldwide profits there. Many other "American" companies are also taking advantage of Ireland's lax tax laws, including Google, Facebook, Pfizer, Johnson and Johnson and Citigroup.

We now know that, as the Wall Street Journal reports, "Apple used technicalities in Irish and U.S. law to pay little or no corporate taxes on $74 billion over the past four years." Sen. Carl Levin described Apple's bookkeeping as the product of "alchemy" and "ghost companies," and that's true insofar as the United States is concerned.

A Senate panel concluded that Apple negotiated a deal with the Republic of Ireland whereby it would declare earnings there and pay an ultra-low rate of two percent. That arrangement sits atop a corporate tax filing in which, as the New York Times reports, Apple assigns more than $100 billion in profits to overseas subsidiaries.

As the Times also reports, Apple created an entity called Apple Operations International and incorporated it in Ireland. But despite the fact that this entity is purportedly based on the Emerald Isle, it "keeps its bank accounts and records in the United States and holds board meetings in California."

Apple Operations International gets all the benefit of being an American company, and collects the lion's share of profits for one of the most profitable countries in the world. And yet it pays a tax rate of only two percent.
I get so sick of hearing these corporate CEOs talk about "shared sacrifice," patriotism and how they are so victimized by the US tax system!! They aren't sacrificing. They are laughing all the way to the bank! How patriotic is it to shift their profits around like a shell game? And how can they say they are victims of the US tax system, when many of them pay little or no taxes?

But that's not the worst of it for me. The thing that drives me up the wall is that liberals hold up Apple as a model for what a "progressive" company can and should be. If this is the best American capitalism has to offer, then we're in far deeper shit than most people realize!

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