Second in an occasional series
WASHINGTON — Lobbying for special tax treatment produced a spectacular return for Whirlpool Corp., courtesy of Congress and those who pay the bills, the American taxpayers.
March 17
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March 17
Second in an occasional series
WASHINGTON — Lobbying for special tax treatment produced a spectacular return for Whirlpool Corp., courtesy of Congress and those who pay the bills, the American taxpayers.
Comments
What this article shows is that high tax rates on corporate and personal income invite lobbying to get exclusions, exemptions and deductions for special interests. Paul Ryan understands this whereas Barack Obama does not. Wait a second. Perhaps our president does understand: He wants high tax rates and generous tax breaks for his political allies and contributors.
Ridiculous. Even if the corporate income tax rate was lowered from 35% to 25% corporations would continue to lobby for additional rate cuts and special exemptions, credits, etc. Why would they stop pushing for what's in their best interests? The issue here isn't whether corporations will stop trying to influence policy in their favor. It's whether "we the people" have enough awareness and collective power to push back against them.
Our tax sysetm is irreparably broken and needs to be replaced. Unfourtunately, our elected officials are a bunch, of (largely geriatirc) bozos that, at best, are part time legislators who spend most of there time raising money and blowing smoke up our petutis. So there really is no one to do the job. Nice job electorate.
Them that's got shall get, them that's not shall loose, so the bible says, and it still is news. god bless the child.....
The actual purpose of this article, like any Globe article is its everybody's duty to keep paying more and more taxes so the government can spend more and more. You are not supposed to question this philosophy.
"While Congress fights over ways to cut spending and the deficit, generous breaks for corporations pass with little notice"..Also the Globe doesn't report that the Senate budget has ZERO budget cuts, restores any cuts from the sequester, and then adds another $Trillion in tax increases...And the the Globe says nothing about the president's view, which is "We don't have any spending problem, we need more taxes (OOPS, I meant to say more Revenue).
And I agree with the President, and so does every credible economist. Look what austerity has done to Europe.
Cordgrass: Look what austerity has done to Europe? Nah, look what huge sweeping Nanny state programs have done to Europe. The austerity came as a result of the "tax em until they bleed out" so we can buy votes philosophy of politicians.
THAT is what this article is really about.
Interesting though how you decide the only credible economists are the ones who agree with Oblamer.
The headline got me all excited that the Globe was doing real journalism, but then I see the focus on these "evil" corporate tax breaks--saving energy. Those are the kind of tax breaks I WANT corporations to receive. These tax incentives benefit all of us. The more people who have energy-saving Whirlpool appliances and electric motorcycles, the cheaper energy becomes for the rest of us. The more we shift from burning fossil fuels to sparingly using electricity generated by renewable sources, the stronger the fight against climate crisis. Get rid of tax breaks given to oil companies. Get rid of tax breaks given to corporations that offshore workers. Give tax breaks to corporations that keep jobs in America. Give tax breaks to corporations that pay a living wage.
Corporate AMT. simple. If corporations are people they can pay taxes like people. Let's apply Alternative Minimum Tax to corporations.
The President has consistently asked for a balanced package of cuts and revenue. After the GOP marched through Washington with unfunded tax cuts, two wars and a House that votes with the wealthy, revenues are down significantly. "The federal income tax accounted for 41.5 percent of federal receipts in 2010 (down from 49.6 percent prior to the Bush tax cuts of 2001 – 2003). Corporate taxes brought in only 8.9 percent, also down sharply since the recent recession. Payroll taxes and other "social insurance" payments accounted for 40 percent of total receipts in 2010." This is a complicated issue as we all know. Here is a good primer on the subject. I will add that there are some good arguements that the recession was not at fault. All are available from Heritage Foundation (Republican view) and Forbes (republican view.) This excerpt was from:
http://www.factcheck.org/2011/07/fiscal-factcheck/
For me, the most disturbing fact is that "payroll taxes and other "social insurance" payments accounted for 40% or total receipts in 2010." That's you and me, and the gap between us and the wealthiest 2% got larger under this Republican House. The GOP may be constantly talking about money in the short term (for the very wealthy) but the immediate consequence is in children not having an educational opportunity for college.
"And the gap between rich and poor in college completion — one of the single most important predictors of economic success — has grown by more than 50 percent since the 1990s, said Martha J. Bailey, an economist at the University of Michigan. More than half of children from high-income families finish college, up from about a third 20 years ago. Fewer than 10 percent of low-income children finish, up from 5 percent. "
http://www.nytimes.com/2011/11/16/us/middle-class-areas-shrink-as-income-gap-grows-report-finds.html?_r=0
Sawmill just had to play the "children" card, could not resist. Exactly which colleges are federally funded? Yes, yes, I know, they get federal funds. But "federal funds" is really local money that has been laundered with the usual resulting shrinkage as it passes through DC (so they can afford to live in one of the five wealthiest counties in the nation).
Sawmill is pretty funny though, in the second paragraph he writes about the University of Michigan, not the University of the United States. The people of Michigan pay for the University of Michigan, not the federal gov.
@sawmill12
I posted this yesterday but I'll say it again, but it's worth saying here, too.
*** Businesses don't pay taxes; they collect them. ***
The taxes you would seek to raise on businesses will almost surely find their way into the prices you and I pay for everyday goods and services. We ought not let ourselves fall for the divide-and-conquer strategy of those whose mission in life is to get even more or the nation's wealth flowing through Washington.
Congress can't get togeather on revenue or expenses but they are best buddies when it comes to spending. In addition to these goodies, there was $55 billion in pork in the hurricane Sandy bill. I didn't vote for Senator Warren, but she is absolutely correct when she says the system is rigged. Where are our congressional reps? One of them is going to be a senator and they have stood by and done whatever Nancy Pellosi told them to do. We are so screwed.
This is an excellent article if one can wade through it and get to the major theme.
No matter which party these clowns belong to, they are going to pander to the corporations to get campaign funding. They do it quietly, like thieves in the night.
Any of their talk about being a public servant for their state is a bunch of hooey. They are there because they want to be part of the political ruling class. They crave power.
The days of people like Abe Lincoln are long gone.
Abe Lincoln, though arguably much more guided by higher principles as president than most of today's politicians, also craved power. Check out The Fiery Trial: Abraham Lincoln and American Slavery, by Eric Foner. I'm finishing it up now -- gives great insight into the president's evolution on slavery and his fierce politicking on the issue leading up to his election and during the Civil War. Lincoln certainly helped usher in the end of slavery, but he wasn't born with the Emancipation Proclamation in hand. Much more radical members of his party -- people we'd call screaming liberals these days -- held his feet to the fire on the moral dimensions of slavery.
Aaaah,,,, HISTORY has another failing besides his previous posts: he doesn't read all the replies, at least not on this short thread. Anyway, I hope HISTORY reads RICHARDDUSTIN above...and saw "Lincoln" besides. He picked the wrong guy to make his point: he should have used Norman Solomon, the Democrat defeated in California's District 2 election; he accepted no PAC money at all and abided by progressive, anti-war, FAIR transparency toward a Greater Good.
I have no problem with paying taxes and corporations shouldn't either. It is part of our civic responsibility. It is time to give tax breaks to companies who benefit the public good here in the US. I have reached the point where I will not deal with a company that sends jobs offshore or that does not pay their employees a living wage here in the US. Tax breaks for corporations, not contributing to the common good in the US, needs to stop, lobbying for them needs to stop. We only walk the earth so many hours, if I were a legislator, I don’t think I would use this time to meet with a lobbyist.
I would like to see IRS 990 502c reform next. Non-profit does not necessarily mean charity. Riding under the banner of “non-profit” these institutions pay little or nothing for the services they use in the communities they reside in. Right here in Boston, 50% of the land mass is owned by non-profit institutions and non-profit businesses. Who picks up their share of municipal services? The people who can least afford it urban families! The proliferation of large "non-profit" institutions and non-profit foundations mirror the business practices of profit corporations. They are rolling in the bucks and these non-profits even have lobbyists! Why?
I find that the Museum of Art (MFA) particularly egregious and arrogant in their refusal to pay their fair share for municipal services. According to the 2011, MFA IRS 990’s, the MFA has NET assets of $941,781,237! I am not talking about art hanging on the walls, that is not even considered part of the formula! I am talking about CASH! The MFA has INVESTMENT FUNDS in Central America and the Caribbean totaling $76,796,906! The City of Boston PILOT program asked the MFA to contribute $518,887. Moreover, $259,443. (50%) was a "community service credit!" The MFA only contributed $56,319, $9,904. LESS than they contributed in 2010! Malcolm A Rogers, MFA Director, was paid $827.930.00! He received a “housing allowance” of $62,500.00! The Boston Emergency Shelter Commission, a Boston municipal service, reported that there were 6,647 homeless in 2011. Does anyone beside me see a problem of “non-profit” corporate greed here! $518,887 is chump change to the MFA! I wonder how much they are paying their lobbyist!
It is time to "reform" and remove the non-profit 501(c)(4) status of many of these non-profit institutions, they have moved on, and are now big money making corporations!
http://www.cityofboston.gov/Images_Documents/FY13%20First%20Half%20PILOT%20Status%20Report%20for%20Web_tcm3-35784.pdf
http://www.cityofboston.gov/Images_Documents/FY12%20Second%20Half%20PILOT%20Status%20Report%20for%20Web_tcm3-33007.pdf
http://www.charities.ago.state.ma.us/charities/index.asp?charities_app_ctx=details&charities_sub_ctx=entry∨igin=search&did=30322734&bod=1358094074
@jshore,
<< It is time to give tax breaks to companies who benefit the public good …>
jshore, this is the slippery slope we've come down. The desire to do this is easily understood: use the vast power of the federal government and its tax code to shape society in ways that seem good. Unfortunately it's ultimately a crock, and here's why.
To do what you advocate we must discern which companies "benefit" the public good and which do not. And that means giving those in Washington the power to pick winners and losers based on entirely subjective criteria. This is essentially the system we have today and it's why lobbying is such a lucrative business. That is also why huge sums of corporate money flow into political campaigns in a great exchange of favors with tax breaks as the payoff. We would be much better served with a set of flat tax rates with no deductions for anyone or anything. Let everyone contribute based on what they earn and close the doors to Washington's favor factory.
In short, if you'd like to take the money of out politics, give the politicians less to sell.
Shhhh....you're not supposed to question the non-profit scam!
Sorry about the formatting, don't know what happened. I wish the Globe would get a preview button.
Ralph Nader spoke about corperate welfare many years ago. He pointed out that we give more welfare dollars to corperations then we give to people. I would subsitute the word corruption for dysfunction where ever it appears in this article.
I’m in the market for new appliances. I won’t be buying Whirlpool. I wished the article included those companies who are picking up their fair share of corporate responsibility. Anyone know where I can begin my search?
"..Former senator John F. Kerry, another member of the committee, said certain industry sectors need temporary tax subsidies. Oil and gas companies, Kerry explained, benefit from permanent tax breaks in the law, while the wind, solar, and other alternative energy interests are forced to come to Congress “hat in hand’’ every two years..." And in all the time he spent there why didn't HE do something about it. He was and will continue to be part of the problem only now he's giving away our tax dollars to the people who despise us and want us dead.
As for alternative energy,he supported the "loans" (giveaways) to the industryb that thus far have been total failures.
Great point on the charities Jshore. It is remarkable what they get away with.
What the excellent article did not point out directly is that the "temporary", two-year tax breaks work for both the politicians and the lobbying firms by having the corporations need to continually contribute to the politicians coffers and pay the lobbyists. If they had permanent tax breaks, there would be less work for the lobbyists and fewer campaign contribution handouts for the politicians. Thanks for exposing the sleazy underbelly of the political payoff machinery in Washington.
NOTHING_will ever change, be it taxes, health care costs, gun or environmental laws, etc. as long as the people continues to elect politicians who campaign as wolves in sheep clothing. Most people will not take the time to question the details and fewer still give one iota about the outcomes. Case in point are the Nov.2012 elections of Obama, and our very own Massachusetts candidates.
Hmmm...any patriots on the right feel like dragging out the "Obama is a socialist" whine?
Any sanctimonious progressives feel like weeping about how the republican party is only exists to help the evil rich?
Don't you both look like kids on a playground after an an article like this...written by the commie globe no doubt.
But not to worry, keep reminding yourself that picking a side and fighting to the death over god, gays and guns is definitely NOT a waste of time. At least you fit in, right?
Please America...vote any third party every time you vote.
@sawmil2
Your last post was very thoughtful, thank you. We're bumping into the limits of this medium, so I'll just list a few quick comments to your last reply.
We fundamentally disagree on whether we're taxing too much; that's ok, we need not agree, but I think if you look at the per capital taxation over the last 40 years it's gone steadily up even after you account for inflation. The scary thing is that spending has still far out paced this to the point we borrow $0.40 every dollar we spend. There is only one credible solution: freeze spending and grow the economy (I would favor a real cut in spending, but I realize that's simply not going to happen as even Paul Ryan's budget proposed a 3% increase in the budget over the next 10 years).
I suspect we also disagree on what a fair profit it is, too. Again, with the premise of it being an competitive market, what customers are willing to pay for your service is a fair price. If that's an amount is 50% over what it cost you to make and sell that product, goodie for you. Enjoy those profits while you can; you've earned them by being that much better at what you do than everyone else. As I said, such profit margins are unsustainable. IMO, it's a mistake to give a third party (like Congressional committee or political appointee) the authority to decide how much is too much. That is far too much power, IMO, as it's more likely to be exercised for political gain and not to achieve "fairness." I'd much rather have customers deciding what something is worth as their interests are far simpler to discern.
IMO, GM should have been allowed to go under. The bailout just delayed the inevitable. They did not address their labor costs (they couldn't as team Obama couldn't afford to alienate the auto workers union). GM will be back in the soup within five to ten years as they cannot compete long term with their cost base. A complete restructuring (and possible sell off) is still needed.
Lastly, you mentioned a few industries as examples of "corporate greed." You might be surprised at the average profit margin of some you mentioned. You were right flag pharmaceuticals as one that does well; they average about 19%. Banks, on the other hand, only work with margins of about 5%. Health care providers and health insurance companies clock in at 3% or less.
Bye for now.
Will everyone please stop blaming Ralph Nader for his 2000 Presidential run. He raised these issues and predicted these outcomes.
Most of this would have happened even if Gore had been elected.