Donald Trump and the Republicans want a lower corporate tax rate. But many of the largest U.S. companies have paid ZERO federal income taxes in recent years, and overall the corporate world pays anywhere from 13 to 19 percent, about half the 35 percent statutory rate that they so often complain about.
In 2016, fifteen of the largest corporations in America, with combined revenue well over a trillion dollars, paid less than 6 percent in U.S. federal income taxes.
Meanwhile, profits have been growing at the fastest rate in six years, with a double-digit increase in the most recent quarter.
Investing in America? No, Stockholders Suck Up All the Profits
Until 1982 stock buybacks were deemed illegal, a type of stock market manipulation with a penchant for boosting share prices for investors and management. But since then they’ve become hugely popular on Wall Street. 119 companies in the S&P 500 spent MORE ON BUYBACKS THAN THEY GENERATED IN EARNINGS in 2016. Big Pharma spends more on buybacks than on “research and development” (R&D) for medicines and drugs.
Investing in Jobs? Yes, $100,000 Jobs and $15,000 Jobs
The Bureau of Labor Statistics and Pew Research are confirming what we already know: high-paying knowledge-based jobs and low-paying service jobs are proliferating, while mid-level jobs continue to disappear.
Median household income is about $2,000 less than it was ten years ago. Since 1970 the American middle class has shrunk, according to the New York Times, from 65% to 41% of the population, with an approximately even exodus to upper-income and lower-income households.
And that ‘growing’ job market? A Princeton study concluded that a shocking 94 percent of the nine million new jobs created in the past decade were temporary or contract-based, rather than traditional full-time positions.
Competition? No, a Few Big Firms Squeeze Out the Smaller Businesses
America has become a kleptocracy in part because it’s an oligopoly. About 40 years ago, 109 firms earned half of the profits of U.S. public companies. Today it’s just 30 firms.
Google has 88 percent of all search advertising; Facebook (including Instagram and WhatsApp and other acquisitions) has 77 percent of all social media traffic; Amazon processes nearly half of online retail sales. Dean Baker notes that we pay higher prices for computer software because of the patent and copyright monopolies claimed by Microsoft and other tech companies. Baker also discusses the monopolistic effects of patents in the pharmaceutical industry: “The breakthrough drugs for cancer, hepatitis C, and other diseases, which now sell for tens or hundreds of thousands of dollars annually, would instead sell for a few hundred dollars.”
The Mainstream Media is Afraid to Speak Up
American corporations benefit the most from our nation’s security, public infrastructure, legal system and tax laws. Yet rather than support public education and job creation, they use much of their money for buybacks and foreign hoarding. As a result, our schools and infrastructure are crumbling, and the tax avoiders use this to justify their “government doesn’t work” mantra while clamoring for even more tax breaks to ‘stimulate’ the economy.
Mainstream media opinion editors don’t appear to have the courage to risk the disapproval of their bosses by printing the facts about corporate tax avoidance. As the public remains uninformed, business-happy governors continue with the corporate tax breaks, and state governments are forced to rely on regressive taxes for education and infrastructure funding. It’s all part of the pillaging.