04.18.11

Egregious falsehoods explained

Posted in Permanent Fail, Predator State at 8:23 am by George Smith

Continuing on yesterday’s riff on the ease with which corporate American mobilizes group lickspittling to astro-turf images at variance with reality, the blog points to an article by Don Barlett and Jim Steele writing in the Philadelphia Inquirer.

While at the Inky, Barlett and Steele won two Pulitzers. As a team, they’re the “gold standard” in US investigative journalism.

The jump-out synopsis, among other things:

“The United States has two tax systems: A flexible, preferential one for multinational corporations and the rich; a rigid, nonnegotiable one for working people. In other words, if you’re not lucky enough to be a global business or a wealthy individual, you must pay pretty much what Congress dictates. If, however, you are among the privileged, well, your company makes billions for you and essentially operates tax-free.”

Nonetheless, corporate America collectively has long whined about paying excessive taxes.

What kind of corporation escapes responsibility for any of these bills? Carnival Cruise Lines for one …

Like others in Congress and the media, Cantor, Bachmann, and Pawlenty insist that American businesses are paying too much in corporate income tax. They claim the onerous tax burden is killing jobs and forcing companies to move abroad. To reverse the nation’s fortunes, they say, all Washington need do is slash the corporate tax rate, thereby reducing the amount of taxes these businesses are forced to pay. What’s scary is a growing number of citizens believe them.

That means a forecast made years ago by William J. Casey, a wily Republican from another era who liked to dabble in the intelligence world’s black arts inside and outside the country, and who helped craft the election of Ronald Reagan, is coming true. After taking office, President Reagan installed Casey as head of the CIA in 1981. After his first staff meeting at the agency, Casey was quoted as saying:

“We’ll know our disinformation program is complete when everything the American public believes is false.”

One of the more egregious falsehoods being peddled by the corporate tax cutters is that companies doing business in the United States are taxed at an exorbitant rate. Not so.

Perhaps a more telling yardstick, corporate tax revenue in 2009 came to just 1 percent of gross domestic product – the lowest collection level since 1936, or three-quarters of a century ago. In 2010, it edged up to a puny 1.3 percent – the second-lowest since 1940. Even worse, the shriveled tax collections came at a time when corporations were registering an all-time high in profits. At the end of 2010, corporations posted an annualized profit of $1.65 trillion in the fourth quarter. In other words, the more they made, the less they paid.

In its most recent filing, Exxon Mobil Corp., the global energy giant, reported income of $34.8 billion before taxes on total revenue of $310.6 billion for 2009. Its U.S. income tax bill: Zero.

The entire piece is great.