Exxon, one of the largest corporations in the world, showed profits of $19 billion in 2009. But they paid less tax than the poorest person in America paid. They paid $0 federal income tax in 2009. They can thank their millionaire Congressmen, who have written and passed new laws into the 73,608 pages of IRS rules and regulations (tax code) to force the poor, the middle class, and small businesses to pay income taxes; but not Corporate America. The only conclusion a reasonable person could reach is that Corporate America and the United States Congress are in bed together. Make no mistake, the people who have the money to buy Congress, run America. But everyone already knew this and it should not be continually repeated. The Republicans in Congress want huge budget cuts so all this talk about forcing the rich and Corporate America to pay their fair share of income taxes will go away. President Obama said in one of his speeches that we are going to block the loopholes that allow Corporate America to operate in America without paying one cent to help run America. However, talk is cheap and there has been no action as of yet, and probably never will be. Without tax dollars from the major corporations in America, the federal government will continue to run up a national debt that can never be repaid. In the final analysis, the U.S. dollar will probably be near worthless and the poor will suffer the most.
Since 1961, the federal income taxes collected from corporations have decreased by half, instead of increasing as their profits increased. $70 billion a year is lost to the U.S. Treasury as a result of offshore tactics used by corporations to legally dodge paying income taxes. A method called Transfer Pricing is used by nearly every corporation and drug manufacturer in America to transfer money earned in America into and through small countries. This transferred money is not declared as earnings on American corporation’s income tax, but rather as earnings on a foreign country’s tax records where the tax rate is very low. While America suffered high unemployment in 2010, corporate profits rose by 37 percent. Corporate profits reached $1.68 trillion during the fourth quarter of 2010 while the American economy struggled. Federal revenue of $2.4 trillion has been lost to the U.S. Treasury due to tax cuts during the Bush Administration.
$38 billion in spending cuts were passed by the U.S. Congress in 2011. This bill was secured by Republicans who fought for it. It was the largest spending cut in United States history. Low income energy assistance was cut by $390 million. Local and state law enforcement assistance was cut by $415 million. Community Health Care Centers were cut by $600 million. Defense Department Environmental Cleanup was cut by $638 million. The Federal Emergency Management Agency (FEMA) was cut by $954 million. Clean and Drinking Water Funds was cut by $997 million.
Most state treasury incomes are down due to the recession and meager retail sales, which have lowered sales tax revenues. Many state governments are near bankruptcy and are in desperate need of federal funds. States giving corporations tax breaks is an unnecessary loss of revenue in the opinion of some experts.
Multi-national corporations buy influence in Congress through campaign donations. The cost to run a campaign for a Congressional seat is in the millions. Only the PAC organizations, mostly owned by large corporations, have enough money to make huge donations to Congressional candidates. These large donations are the lifeblood that keeps a Congressman in office, and they know that there is no such thing as something for nothing. I guess you could say that the only candidates Americans will be allowed to vote on are the ones picked by Corporate America and other entities with unlimited capital and a need for Congressional influence. A U.S. News report states that the average campaign cost to win a U.S. Senate seat is $5.6 million. Max Baucus, (Democrat-Montana) spent $13,647,218 on campaigns 2005-2010. His top donations came from Schering Plough Corp.-$86,000, New York Life Insurance-$70,850, Amgen Inc.-$70,250, JP Morgan Chase & Co., and Merck & Co. This is an illustration of how U.S. Senators come to owe favors to corporations.
The Supreme Court recently ruled that corporations had the same rights to donate money to campaigns as do individuals. This opened the flood gates for corporations to use their vast funds for, or against, a candidate for federal office. President Obama’s 2008 campaign committee raised more than $650 million by itself. Other donations came from the Democratic National Committee. The majority of individual donations came from PACs (Political Action Committees) and individuals affiliated with companies.
In 2010, Citigroup had earnings of $4 billion, and paid $0 in federal income taxes. Honeywell profits for 2010 were $1.25 billion. They paid $0 income tax for 2010. They received a $282 million tax refund at the expense of American taxpayers. Jeff Immelt, CEO General Electric, was selected by President Obama to lead America’s council on competitiveness. Just two months later, the New York Times broke the story that General Electric had earned $5.1 billion in U.S. profits in 2010, and had paid $0 federal income tax. When questioned at a later conference, Immelt stated that GE had done nothing illegal and that it was GE policy to keep taxes as low as possible. Lou Dobbs, on the O’Reilly Factor show, stated that GE spent millions of dollars creating loopholes and using aggressive representation to legally avoid owing or paying U.S. income taxes. Dobb’s stated that Corporate America buys with $4 billion a year, the representation in Congress that citizens of the United States can’t buy. GE spent $39 million lobbying Congress in 2010; more than any other corporation. Most corporations love selling their products to American consumers. Most corporations enjoy the freedom and privilege that America offers. They just don’t like hiring American workers or paying federal income taxes as a part of those privileges. Their stockholders are their main concern, not the American economy or the wellbeing of the American people. The sad part is they are in control.
There are two grassroots organizations fighting to correct this unfairness. U.S. Uncut is an organization dedicated to forcing Corporate America to comply with their moral obligation to pay their part of federal income taxes necessary to keep America solvent. The US Uncut mission is to take the fight back to corporate tax dodgers. They are targeting corporations that paid their lobbyists more than they paid in federal income taxes. They have a target list of 29 corporations, courtesy of a list from Citizens for Tax Justice. Some of the worst offenders at the top of their list are GE, Verizon, and Fed-Ex.
The Occupy Wall Street Movement has been helped by the US Uncut group members joining in their activities and protests. Occupy Wall Street activists protest against financial greed and corruption. Occupy Wall Street is a resistance movement made up of many races, genders and political persuasions. They are the 99 percent that will no longer tolerate the greed and corruption of the 1 percent. They state that they use the revolutionary Arab Spring tactic to achieve their goals. They encourage the use of non-violence to ensure the safety of all participants.
An in-depth documentary video on this subject, “We’re Not Broke,” can be viewed on Netflix or Amazon.