The "Young Turk" speaks out on the need for separation of business and state
Our country was founded upon the principle of the separation of church and state. This doctrine was essential to guarantee religious freedom in our nation. Now that business has assumed the stature of a religion in our country with our beliefs in the Almighty Dollar and "greed is good", shouldn't there also be a separation of business and state? In order for small businesses to exist and be free from the control of big business, isn't it time to separate the mega multinational corporations from our governmental officials? Can we have economic freedom in our country with only four huge banks controlling all of our financing, a few oil companies controlling all of our gas and heating oil, four (soon to be three) accounting firms controlling public accounting, and a host of other oligarchies and monopolies? How can the spirit of capitalism exist in accordance to the creed of Adam Smith as contained in his book, "The Wealth of Nations" without true competition, unshackled from the chains of monopolies, oligarchies, and the takeover of government by monolithic multinational corporations?
Cenk Uygur delivers his commentary on a recent request by Corporate America for a tax break on bringing over one trillion offshore dollars back into the country. Has the time come to build an official wall between business and state? What follows is my own paraphrasing of the young Turk's scathing commentary. Needless to say, I interjected here and there an irreverent remark in my own inimitable fashion. If you wish to know precisely what the young Turk said without any comments from the peanut gallery, just click on the video above. For the complete 10:51 minute video, you can go to the Barefoot Accountant's Theatre.
Corporate America has requested a tax break of over $1 trillion for money that these corporations have sitting offshore. In a meeting with President Obama, the heads of these so-called American corporations asked for a tax holiday in order that they can bring their profits back into the United States without paying taxes.
Apparently, when big business requests a "tax holiday", it is not tax evasion but tax avoidance. We would all like a tax holiday to avoid paying taxes. Unfortunately, you and I do not have the lobbying power of multinational corporations behind us. That is, we do not have a whole political party behind us devoted to making us richer. In case you have been living in a cave for the last thirty years, the political party to which I refer is the Republican party.
These multinational companies are playing a shell game aided and abetted by the GOP, which is supporting their efforts to take their profits in and out of our country through tax "tricks", making it appear that these corporations did not make any of these profits in the United States. One common trick is to declare all revenues in Bermuda, where there is virtually no corporate taxation, but then declare most, if not all, of their costs here in the United States. Don't believe it? Look at the facts.
In 2009 Exxonmobil made $373 billion in profits but paid no taxes. Bank of America made $4.4 billion and not only did not pay any taxes but received $1.9 billion back from the United States government. Similarly GE earned $10.3 billion in profits and received a tax credit of $1.1 billion. In other words, I paid more in taxes than all three of these multinational corporations.
The multinational corporations do not have nationalities or morals. They are not real people, nor are they Americans, nor are they patriotic, like you and me. They are amoral machines, Terminator robots, existing for one purpose: to make profits. Period. Even though Google has been touting for years its mantra, "don't be evil", it, too, has avoided $3.1 billion in taxes over the past three years by doing these tax tricks.
Need further proof? When the US had a ban on doing business with Iran, Haliburton set up an office in Tehran and continued to do business anyway. And who was its CEO at that time? None other than our beloved Dick Cheney, the former Vice President under George Bush. (How do you think that Cheney, a Yale flunky without inherited wealth, accumulated a personal portfolio of assets worth as much as $94.6 million by 2005?) Later Haliburton moved its corporate headquarters to Dubai to avoid paying US taxes while raking in huge US contracts as an American company rebuilding Iraq.
The problem behind all of these tax tricks stems from our politicians saying they are pro business, using this mantra as an excuse to give these multinational corporations huge tax breaks, which, in turn, are then partly funneled back to these very same political mouthpieces in the form of campaign donations: that is, a commission for services rendered.
No one is anti-business. We all want small and big businesses to succeed so that they will hire more Americans. But we don't want people using the excuse of being pro business to funnel our tax dollars to multinational corporations so that they can invest these monies overseas and create jobs over there with our tax dollars.
Last year "American" companies created 1.4 million jobs overseas; however, they created less than 1 million jobs here. If these multinational corporations are creating jobs overseas, then let them get their tax-break subsidies from Bermuda and Singapore and not here. Why should American taxpayers finance the operations of multinational corporations overseas?
There has to be a separation of business and state. This is not the United States of Corporate America. Our representatives were elected by us to look out for us, the voters, and not their corporate benefactors.
We also need to get much tougher on enforcing our tax laws. In 2004 President Bush allowed these so-called "American" companies to repatriate $312 billion back into the United States at a tax rate of 5.5%, far below the corporate tax rate of 35%. That's why corporations loved George Bush: all their corporate executives received huge bonuses that year.
Recall that during the Bush years we followed the Republican strategy of just trusting big business to create jobs by giving them all these tax breaks. And what happened? Since that 2004 huge tax break, we lost 7 million jobs. On top of losing these jobs, it then cost the American taxpayers a trillion dollars to bail out some of these huge corporations, whose corporate executives saw fit to helping themselves to over $6 billion in bonuses from our TARP monies.
The question is why do we trust our collective tax dollars to these amoral multinational corporate machines? Isn't it time to build a wall between business and state so that government looks out for our interests and not those of the multinationals?
Now once again these same corporations are requesting another tax holiday and additional tax breaks, arguing that they need them to create jobs in the United States. But most corporations have plenty of money. Corporate profits are higher than they have been in years. In fact, big corporations are sitting on $1 trillion of cash. And they have not been creating jobs in the United States but abroad.
But it is not only the Republicans who are supporting the tax holidays for the multinational corporations. Democrats are guilty of not telling the American people about this corporate malfeasance or nonfeasance. Why? Because many Democrats are drinking out of the same trough of corporate donations as their fellow Republicans.
Earlier this year the Supreme Court ruled that corporations are people and are thus entitled to provide as much money as they wish to campaigns and politicians. But corporations are not people. They are just machines with one simple purpose: to maximize profits for their shareholders. If we bestow first amendment rights on these machines and treat them as people, we will allow them to corrupt and undermine our politicians and our political process. They do not represent America. These multinationals know no national boundaries. These global corporations exist to maximize profits, not to create jobs in America. Since they exist to maximize profits and not create jobs in America, they have been and will continue to invest, sell, and create jobs in the most rapidly growing markets, which are in China, India, Brazil, etc.
Of course, it is OK for these multinationals to do this. No one is arguing that point. The question is should the American taxpayers be subsidizing their investments overseas with our tax dollars: i.e., the tax dollars that they are requesting not to pay and have not been paying. What can we do about it?
Republicans are a wholly owned subsidiary of these multinationals, while Democrats are, at least, a partially owned subsidiary of them. These politicians are essentially on the corporate payroll, bought and paid for. Consequently, we need campaign finance reform. Unless we stop the flow of corporate dollars into politics, any vestige of a democracy will be gone, replaced by a corporate totalitarian state.
The Barefoot Accountant—is a Certified Public Accountant, Certified QuickBooks ProAdvisor, operating an accounting, tax, and QuickBooks consulting firm in Berlin, Connecticut, Accountants CPA Hartford, Connecticut, LLC. Bill has instructed graduate and undergraduate courses in Accounting, Auditing, and other subjects at the University of Hartford, Central Connecticut State University, Hartford State Technical College, and Purdue University. He also taught GMAT and CPA Exam Review Classes at the Stanley H. Kaplan Educational Center and at Person-Wolinsky, and is certified to teach trade-related subjects at Connecticut Vocational Technical Schools. His articles on tax and accounting have been published in several professional journals as well as on several accounting websites. William was born and raised in New Britain, Connecticut, and served on the City's Board of Finance and Taxation as well as its City Plan Commission. Bill is a crazed animal lover, feeding birds, squirrels, chipmunks, skunks, possums, stray cats, and any two-legged or four-legged critter traversing through his yard. His backyard in Berlin, Connecticut has been certified as a habitat suitable for wildlife by the National Wildlife Federation.
Bill also writes an Accounting, QuickBooks, and Tax blog: Accounting, QuickBooks, and Taxes by the Barefoot Accountant. For entertaining articles, please see his listing at The Amazing Brighenti.