My Fair Lady

For all the years I've lived, you'd think I be accustomed to it, but I still find human nature strange, if not bizarre.

I'm still flummoxed by it.

Sure, I'm aware that people can, and will, do certain things out of the ordinary--things for which I'm always scratching my head in total amazement, bewildered beyond words.

And when they do, I'm taken aback, sometimes pleasantly when they offer a kindness (such as holding a door open), and sometimes exceedingly perplexed, especially when people behave in ways that are foreign to my sensibilities, and my expectations.

One instance from my life will serve to illustrate this. I once worked for an organization that required that some of us meet at least once every other month to coordinate system-wide activities. We were a fairly good size group, perhaps as many as thirty or forty of us.

We would meet at various locations throughout the system and the meeting organizer from each location was responsible for providing morning refreshments, and arranging for a restaurant that would accommodate our number for lunch, as it was customary for us all to eat at the same time, and in the same place.

When the collective bill arrived, each would pay for what they had ordered, and, in a similar fashion, each would leave tips, in the middle of the table according to the generosity of each, or how each felt about the quality of the service.

On one occasion, the tip was left as usual, a fairly large amount, as there were many in our number, and the service had been excellent.

Most of us had filed out of the room where the lunch tables and chairs had been assembled, with me and another straggling behind, my companion straggler a well-respected, middle-aged woman, who had stopped suddenly to eye the pile of money that constituted our collective tip, left there by those who, after settling up, fully expected that the money that remained on the table would go to the restaurant staff that brought the food and drinks to our table.

With out hesitation, my coworker reached into the pile and withdrew a handful of the bills deposited there. "That's too much money for a tip," she said simply, and stuffed the money into her coat pocket and walked out.

I was stunned.

Not only did she take an unwarranted initiative, she had, in effect, stole money, stealing it twice--first, from those who waited on the table, and then from those who had left the money as a tip.

Not only did my coworker not pay her fair share, she took from those who had.

Some corporations are like my coworker: Not only do they not pay their fair share (using tax loopholes, and tax dodges), they also take from those of us who do pay our fair share. (Click to enlarge chart.)

Here's how the headline reads from this International Business Times article: 30 Major U.S. Corporations Paid More to Lobby Congress Than Income Taxes, 2008-2010. [1]

By employing a plethora of tax-dodging techniques, 30 multi-million dollar American corporations expended more money lobbying Congress than they paid in federal income taxes between 2008 and 2010, ultimately spending approximately $400,000 every day -- including weekends -- during that three-year period to lobby lawmakers and influence political elections, according to a new report from the non-partisan Public Campaign.

The Public Campaign, a non-partisan research and advocacy organization, reports 30 major U.S. corporations spent more money lobbying Congress than they did on federal income taxes between 2008 and 2010.

Despite a growing federal deficit and the widespread economic stability that has swept the U.S since 2008, the companies in question managed to accumulate profits of $164 billion between 2008 and 2010, while receiving combined tax rebates totaling almost $11 billion. Moreover, Public Campaign reports these companies spent about $476 million during the same period to lobby the U.S. Congress, as well as another $22 million on federal campaigns, while in some instances laying off employees and increasing executive compensation.

This revelation is enough to make one take to the streets and start a blood-less revolution--a new movement. Perhaps we'll call it the Occupy Wall Street movement. Wait a minute: Don't we have such a movement already?

Not only do we have such a movement, with each passing day, certain information comes to light to justify its existence, and to silence those critics who have done all that they could on behalf of these offending corporations to besmirch the movement.

And if you believed that it is only the federal government that's being stiffed by these corporations, think again:

"Our report shows these corporations raked in a combined $1.33 trillion in profits in the last three years, and far too many have managed to shelter half or more of their profits from state taxes," Matthew Gardner, Executive Director at the Institute on Taxation and Economic Policy and the report's co-author, said in a statement. "They're so busy avoiding taxes, it's no wonder they're not creating any new jobs."

According to the report, titled "Corporate Tax Dodging in the Fifty States, 2008-2010," state corporate tax revenues have been declining for 20 years, due to the passage of multiple state tax subsidies, as well federal tax breaks that further reduce state corporate income tax revenues since states usually accept corporations' federal tax. Moreover, Gardner said multi-state corporations are constantly "devoting their money and legal firepower to coming up with tax avoidance schemes."

Between 2008 and 2010, the 265 companies analyzed paid state income taxes equal to only 3 percent of their U.S. profits, half of the statutory 6.2 percent state corporate tax rate. As a result, these companies avoided a total of $42.7 billion in state corporate taxes over three years.

What is the Republican position on all this? They believe that these supposed corporate job creators shouldn't have to pay more taxes (their fair share)--and, if they had their way, no taxes at all. But are these tax-avoiding corporations actually creating jobs?

Even while dodging most of their state and federal taxes between 2008 and 2010, Verizon (VZ) laid off more than 21,000 U.S. employees, while Boeing, Wells Fargo, General Electric, American Electric Power, and FedEx also let go of thousands of workers. Because companies can be reluctant to make data changes in U.S. employment available, Public Campaign reports it was not able to find up-to-date employment statistics for many of the companies evaluated in the report.

Moreover, as it was laying off employees, General Electric gave their top executives a 27 percent pay raise between 2008 and 2010 -- executives received more than $75 million in compensation in 2010. Wells Fargo increased executive pay by a whopping 180 percent, upping executive compensation from $17.8 million in 2008 to almost $50 million in 2010, while Boeing, FedEx and American Electric Power also instituted lavish executive pay raises while laying off thousands of lower-level workers.

In fact, 2010 year was a record year for executive compensation. The CEO's of some of the largest U.S. corporations made, on average, $11.4 million in 2010, about 343 times more than workers' median pay, according to an analysis by the American Federation of Labor, the widest gap between executive and employee pay in the world. CEO pay has skyrocketed since 1980, when chief executives were only paid about 42 times more than the average blue collar worker.

Corporate compensation is symptomatic of the income disparity that's become a gaping hole in our economy, looking more like a chasm than a ditch. For better or for worse, corporations are now elevated to the status of gods, permitted to do pretty much as they choose with little or no interference from government regulators, and with politicians at all levels tripping over themselves to regale them with gifts of additional tax breaks, some of which come in the form of negative effective tax rates, tax cuts, and a potential tax reparation holiday:

A negative effective tax rate means that a company enjoyed a tax rebate, usually obtained by carrying back excess tax deductions and credits to an earlier year, thereby allowing the company to receive a tax rebate check, according to Citizens for Tax Justice.

U.S. House Deputy Whip Kevin Brady, R-Tex., is currently making a last-ditch effort to include a corporate tax repatriation holiday on legislation to extend a payroll tax cut....While those in favor of the corporate tax repatriation provision -- which would give U.S. businesses a temporary tax break on as much as $1 trillion in overseas income -- insist it would boost the nation's sluggish economy and make it easier for corporations to create jobs, the Congressional Budget Office reports tax repatriation holidays ranks dead last among 13 policy options for creating jobs. The CBO estimates that over the 2012-2013 period, a repatriation holiday would, at best, create the equivalent of one-full time job for every $1 million in federal costs.

My Fair Lady, my coworker of many years, not only was unfair, so, too, are many of the corporations that make this fair nation their home. Not only have these corporations transferred the tax burden of supporting this country to the average taxpayer, they have become, despite this, one of the chief recipients of government largess--the backing of the world's largest, and most powerful military, and the support of practically every politician in the country, many in the courts, and, at times, the executive branch.

Unfortunately, these corporations have money to burn, and it's burning the pockets of legislators and judges, who, increasingly, are more anxious to fill their campaign coffers, than fill state and national treasuries.


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