SHOULD AMERICA END WALL STREET'S CRIMINALITY? OR LET THE CRIMINALS HIDE BEHIND THEIR CORPORATE WALLS TO PLUNDER - "Republicans in Congress pushed through the tax law signed by Trump in 2017, and its policies favoring the richest Americans and most valuable U.S. companies took effect in 2018."

Could 'Move to Amend' Destroy Corporate Independence?

By Dave Rybarczyk

The New York Times is annoyed that FedEx paid no income taxes in 2018.  Leftists have always despised corporations:  Greedy, evil enterprises that exploit their workers, swindle their customers, pollute the environment, abuse their power, and much worse, all in the pursuit of unjust, obscene profits.

But put aside for a moment the distortions in the Times article, and the fact that the Times itself paid no income taxes in 2017.  The writers omit an important and critically relevant dimension of the story:  A longstanding progressive movement to strip corporations completely of all rights.

"Move to Amend" is a proposed constitutional amendment that would do just that.  Ultimately it would enable material government control of every U.S. corporation -- and establish the basis for constitutionally-protected socialism in this country.

The relevant provisions of the proposed amendment, documented at movetoamend.org, are these:

[Section 1]  [Artificial Entities Such as Corporations Do Not Have Constitutional Rights]  Artificial entities established by the laws of any State, the United States, or any foreign state shall have no rights under this Constitution and are subject to regulation by the People, through Federal, State, or local law.

[Section 2]  [Money is Not Free Speech] Federal, State, and local government shall regulate, limit, or prohibit contributions and expenditures, including a candidate's own contributions... to influence in any way the election of any candidate for public office or any ballot measure… The judiciary shall not construe the spending of money to influence elections to be speech under the First Amendment.

The movement stems from the left’s outrage over the Supreme Court’s Citizens United decision, in which the Court struck down key portions of the McCain-Feingold campaign finance law.  This decision was extremely unpopular with the left because it permitted new freedom for corporate election influence.  Barack Obama famously insulted the members of the Supreme Court as they sat before him during his 2010 State of the Union address over the decision.

The stated rationale for "Move to Amend" is that "corporations wield ever-increasing control" over a number of areas of human conduct.  But while analogous claims can be made for government, the left never seems to notice, or mind, the egregious abuses of power that arise in government.  Never mind that a consumer's relationship with a corporation is optional, while the citizen-government relationship is necessarily one of compulsion.  Unlike corporations, whose "power" ultimately is feeble and fleeting in the face of constant competition and consumer choice, only government can define crime and compel citizen behavior.  A corporation cannot put you in jail if you fail to buy its product.  A government can.  And governance throughout history exhibits a recurrent, inexorable tendency toward totalitarianism. 

On the politics of the matter, the Citizens United decision enabled groups nominally on the right to raise money and have election influence merely equal to that of labor unions habitually aligned with the left -- a former advantage reversed, constituting a major setback for the left.  An examination of the proposed amendment, however, shows that it does much to advance the cause of pure socialism in the U.S.

The amendment would eliminate a long-standing legal principle known as "corporate personhood" that gives corporations many of the same rights that individuals have under the Constitution.

At its simplest, "Move to Amend" puts leftist hypocrisy on stark display.  There is apparently no inconsistency in progressive thinking that a corporation should pay taxes, but have no voice in the matter, no opportunity for representation, and no rights.  If we have a constitutional amendment that extinguishes "corporate personhood," then intellectual honesty and a sense of justice and fairness demand the simultaneous elimination of all corporate taxes, at a minimum.  "No taxation without representation" is a fair claim even for "artificial entities."

But the reality here is considerably worse.  Thoughtful citizens ought to be alarmed by the sweeping nature of the proposed amendment -- "[Corporations] shall have no rights under this Constitution."  Equal protection of the law?  Due process?  Integrity of contracts?  Property rights?  Shareholder rights?  Sorry, no guarantees.

If the Times exhibits no cognitive dissonance on this point, maybe it is because of the last provision of the proposed amendment:

[Section 3]  Nothing in this amendment shall be construed to abridge freedom of the press.

Perhaps the tax-avoiding Times corporation believes it will escape the destruction.

Ultimately, the amendment raises the very question of "control of the means of production" -- a defining point of socialism.  "No rights" means no enforceable barrier to eventual de facto government control of the private sector.  "No rights" means that free-market capitalism continues to exist only at the whim of politicians and bureaucrats.

Perhaps it will not come to that.  But why should we suppose otherwise?  We see that the Times prefers to have it both ways.  The left is not known for intellectual honesty.

"At the same time, the tax cuts for big business are fueling the federal deficit, which will be used by both Democratic and Republican politicians to call for further cuts in social spending. The February monthly federal deficit hit an all-time high of $234 billion this year, as a result of a 20 percent drop in corporate tax revenue. The deficit for the first half of 2019 is projected at $961 billion, and the deficit for the fiscal year ending September 30 is expected to reach $1.1 trillion, as bad as the deficits posted in the immediate aftermath of the 2008 financial crash."

US Tax Day 2019: Sixty giant corporations pay zero income tax

Dozens of giant US corporations, including 60 of the Fortune 500, used deductions, credits and other tax loopholes to avoid paying any federal income tax for 2018, according to an analysis issued by the Institute on Taxation and Economic Policy (ITEP). The report was published April 11, just in time for the April 15 deadline for most American working people to file their tax returns.

The 60 companies in the Fortune 500 who paid no federal income tax had net incomes just from US operations of nearly $80 billion ($79,025,000,000, to be exact). They include such household names as Amazon, Chevron, Deere, Delta Air Lines, General Motors, Goodyear, Halliburton, Honeywell, IBM, Eli Lilly, Netflix, Occidental Petroleum, Prudential Financial and US Steel.

Meanwhile, millions of moderate-income families are finding that their income taxes have either increased or their expected tax refunds have evaporated because of restrictions on the itemization of tax deductions, the imposition of a $10,000 cap on state and local tax deductions and a cut in the mortgage interest deduction.

Nearly all of the 60 companies that paid no taxes qualified to receive a refund from the US Treasury, although most will not collect a check, instead using the credit to offset future taxes. But whatever the bookkeeping process, American taxpayers are effectively paying money to them, despite their vast profits. The biggest refunds include those going to Prudential, $346 million (added to its $1.44 billion in profits); Duke Energy, a whopping $647 million (added to $3.02 billion in profits); and Deere, $268 million (added to $2.15 billion in profits).

Among the report’s most outrageous findings:

Amazon more than zeroed-out its tax bill on $10.8 billion in profits, making use of accelerated depreciation deductions on equipment as well as favorable tax treatment of stock-based compensation for executives like CEO Jeff Bezos, the wealthiest man in the world. The stock compensation deduction alone was worth $1 billion. Amazon will actually show a credit of $129 million from the US Treasury, not paying one cent in federal income taxes.

IBM is another corporate giant that has gamed the tax system by shifting earnings to its foreign operations to escape US taxation. The company reported worldwide profits of $8.7 billion, but only $500 million in the United States. It will reap a $342 million credit from the Treasury.

Delta Airlines accumulated $17.1 billion in federal pre-tax net losses as of 2010, partly as a consequence of a protracted crisis of the airline industry, partly as a result of the 2008 Wall Street crash. It has used these losses as well as the accelerated depreciation credit for purchase of new planes to “dramatically reduce their tax rates,” according to the ITEP report, receiving a credit of $187 million in 2018 despite net profits of more than $5 billion. According to Delta’s chief financial officer, the actual tax rate the company expects to pay going forward is between 10 and 13 percent, far below what a typical Delta worker pays on his or her income.

EOG Resources, a renamed remnant of Enron, perpetrator of the biggest corporate fraud in American history, can collect $304 million from US taxpayers on top of $4.07 billion in profits.

For one company, the federal tax refund would actually exceed net profits. Gannett made a $7 million profit, while showing an additional $11 million credit from the Treasury, giving the newspaper publishing giant an effective tax rate of negative 164 percent.

IBM’s tax rate was a negative 68 percent, while software maker Activision Blizzard and construction company AECOM Technology both posted effective tax rates of negative 51 percent.

Sixteen of the 60 companies made more than a billion dollars in net income on their US operations, to say nothing of foreign subsidiaries. Oil and gas producers and utilities comprised more than one-third of the total, led by Chevron and Occidental among the oil companies, and DTE Energy, American Electric Power, Duke Energy and Dominion Resources among the utilities.

The 60 companies profited enormously because the Trump tax cut bill cut the basic rate for corporations from 35 percent to 21 percent, while not eliminating the loopholes they had previously used to keep their taxes low. They had the best of both worlds, paying lower rates while still enjoying loopholes.

Overall, according to the Joint Committee on Taxation, an arm of Congress, the cut in the corporate tax rate alone will pump $1.35 trillion into the pockets of the corporations over the next 10 years. For this year alone, corporate taxes have been cut by 31 percent.

For the 60 companies in the ITEP report, “Instead of paying $16.4 billion in taxes, as the new 21 percent corporate tax rate requires, these companies enjoyed a net corporate tax rebate of $4.3 billion, blowing a $20.7 billion hole in the federal budget last year.”

This figure by itself is an irrefutable answer to all the bogus claims—made to workers in every part of the United States—that there is “no money” to pay for needed social programs, for wage and benefit increases, or to hire additional workers to reduce overwork and understaffing. The $20.7 billion would pay for a $7,000 bonus to every public school teacher in America.

The bonanza that these 60 corporations are enjoying is three times the amount that Trump proposes to cut from the budget of the Department of Education. It is 10 times the total amount budgeted for the Bureau of Indian Affairs, which provides services for more than 2 million Native Americans. It is nearly 20 times the budget of the Occupational Safety and Health Administration, which conducts workplace safety inspections.

The ITEP report, issued by a group with close ties to the Center on Budget and Policy Priorities, a liberal Washington think tank, warns of the explosive political consequences of the corporate plundering of the Treasury. “The specter of big corporations avoiding all income taxes on billions in profits sends a strong and corrosive signal to Americans: that the tax system is stacked against them, in favor of corporations and the wealthiest Americans,” the report says.

At the same time, the tax cuts for big business are fueling the federal deficit, which will be used by both Democratic and Republican politicians to call for further cuts in social spending. The February monthly federal deficit hit an all-time high of $234 billion this year, as a result of a 20 percent drop in corporate tax revenue. The deficit for the first half of 2019 is projected at $961 billion, and the deficit for the fiscal year ending September 30 is expected to reach $1.1 trillion, as bad as the deficits posted in the immediate aftermath of the 2008 financial crash.

The number of U.S. companies paying zero federal taxes DOUBLED when Trump's tax plan took effect in 2018

·         60 large companies managed to escape 2018 taxes under Trump's new plan 

·         Many of those corporations actually received tax rebates totaling $4.3 billion

·         The businesses include: Amazon, Netflix, Chevron, Delta Airlines, JetBlue Airways, IBM, General Motors, Goodyear, Eli Lilly and United States Steel

·         The result is a $20.7 billion budget hole that is adding to America's federal debt

President Donald Trump's tax policy doubled the number of highly profitable companies that were able to avoid paying any federal taxes in 2018, according to a new report.

Amazon, Netflix, Chevron, Delta Airlines, IBM, General Motors and Eli Lilly were among those who managed to escape taxes for last year, according to the study by the Institute on Taxation and Economic Policy.

'Instead of paying $16.4 billion in taxes, as the new 21 percent corporate tax rate requires, these companies enjoyed a net corporate tax rebate of $4.3 billion, blowing a $20.7 billion hole in the federal budget last year,' the report says. 

The Washington, D.C. think tank analyzed America's 560 largest publicly held companies, finding that 60 of them paid nothing in taxes for last year – double the average of roughly 30 companies that got away scot-free each year from 2008-2015.

Republicans in Congress pushed through the tax law signed by Trump in 2017, and its policies favoring the richest Americans and most valuable U.S. companies took effect in 2018.

Scroll down for the full list of companies and rebates

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This graph illustrates the amount of money that 60 of America's largest companies were billed for taxes last year - along with the actual money they ended up getting back instead of having to pay. Source: Institute on Taxation and Economic Policy

The change cut the tax rate from 35 percent to 21 percent and allowed companies to take advantage of deductions, tax credits and rebates. That change alone is projected to save corporations $1.35 trillion over the next decade, according to the Joint Committee on Taxation.

'We know that there's this pretty glaring contrast between what the proponents of this tax law promised back in 2017 and what it's delivering now,' lead author Matthew Gardner told DailyMail.com.

'The whole argument was that the reason companies were avoiding taxes is because tax rates are so high,' he added. 'What we're seeing is that isn't coming to pass.' 

Collectively, the 60 companies that avoided all taxes last year managed 'to zero out their federal income taxes on $79 billion in U.S. pretax income,' according to the study, which was first reported on by the Center for Public Integrity and NBC News.

For example, the John Deer farm equipment company earned $2.15 billion before taxes, yet owed no U.S. taxes and used deductions and credits to extract $268 million from the federal government.

Nationally, corporate tax revenues decreased 31 percent in 2018 to $204 billion.

'This was a more precipitous decline than in any year of normal economic growth in U.S. history,' wrote Gardner, a senior fellow for the Institute on Taxation and Economic Policy, in the report.

 We know that there's this pretty glaring contrast between what the proponents of this tax law promised back in 2017 and what it's delivering now.        -Matthew Gardner, Institute on Taxation and Economic Policy

Trump had said that the corporate tax cut would pay for itself by sparking a business boom that would create more jobs, thus generating growing income tax revenues for the nation.

That reality hasn't emerged. Instead the nation's budget deficit is higher than it's ever been in this nation's history.

That's despite Trump's campaign promise to eliminate the $19.9 trillion national debt in eight years. So far it has ballooned 41.8 percent in the first four months of the 2019 fiscal year (which runs October 1 – September 30.

The Government Accountability Office announced in April that the 'federal government's current fiscal path … (is) unsustainable.'

Presidential economic adviser Larry Kudlow has said that 'economic growth' has 'paid for a good chunk' of the tax cuts, and that the budget's outlook is 'not as bad' as it's perceived.

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This table lists the amount of money that 60 of America's largest companies were billed for taxes last year - along with the actual money they ended up getting back instead of having to pay. Source: Institute on Taxation and Economic Policy

White House, congressional Republicans accelerate drive for corporate tax cut worth trillions

By Barry Grey
11 November 2017

The push is accelerating for an overhaul of the US tax system that will divert trillions of additional dollars to the corporate aristocracy, widen the gap between the rich and the working class and set the stage for the destruction of basic social programs.

On Thursday, the Republican-controlled House Ways and Means Committee passed a White House-backed tax bill on a party-line vote, after which House leaders said the measure would come to the House floor for a vote next week. On the same day, the Republican-controlled Senate released its version of the measure, with plans for a floor vote in the upper chamber before the Thanksgiving holiday later this month.

If passed, the two versions will be reconciled and a final bill will be moved through the two chambers and signed into law by President Trump.

The Trump administration and congressional Republicans are pushing for passage of the handout to the richest 5 percent by Christmas. The Democrats are putting on a show of opposition that is cynical to the core. They are denouncing the Republican bills for skewing the tax benefits to the wealthy, while fully supporting the centerpiece of the legislation, a huge tax cut for US corporations.

While there are differences between the House and Senate bills, both versions adhere to the same basic framework. The corporate tax rate is to be permanently reduced from the current level of 35 percent to 20 percent, saving US corporations $2 trillion in taxes and generating an additional $6.7 trillion in revenues over the next decade. The House bill enacts the corporate tax cut in 2018, while the Senate bill, in order to reduce the projected deficit from lost federal revenues, delays the corporate tax cut one year, until 2019.

The House bill keeps the top federal tax bracket at 39.6 percent (down from 70 percent in 1980), but applies it to households making more than $1 million a year, as compared to the current threshold of $500,000. The Senate version provides a bigger windfall for the very rich by reducing the top bracket to 38.5 percent.

Both bills eliminate the alternative minimum tax, which almost exclusively impacts the wealthy, and they both slash the tax rate on so-called “pass-through” income reported by business owners.

Each bill allows corporations that have stashed hundreds of billions of dollars overseas to avoid US taxes, such as Apple and Amazon, to repatriate their profits at a sharply discounted tax rate even lower than the new 20 percent corporate rate.

The bills either sharply restrict or eliminate outright the estate tax, which is currently paid by the wealthiest 0.2 percent of households. The House bill doubles the exemption for an individual to $11 million and eliminates the estate tax entirely in 2025. The Senate version doubles the exemption but does not repeal the tax.

Either way, the change underwrites the right of the richest households to pass on their wealth to succeeding generations, institutionalizing the transformation of the United States into an oligarchy, presided over by a semi-hereditary dynastic caste.

Other boons to business are included in both bills, including an immediate 100 percent tax write-off for capital investments. Neither bill eliminates or reduces the so-called “carried interest” loophole that allows hedge fund, private equity and real estate speculators (such as Donald Trump) to pay only 20 percent on their income instead of the normal tax rate, currently almost twice as high.

This is in line with the legislation as whole. While shifting the tax code to further redistribute the social wealth from the bottom to the top, it particularly favors the most parasitic sections of the ruling class, those engaged in financial manipulation.

In order to promote the fiction that the overhaul is geared to the “middle class,” the bills include certain tax breaks, such as a doubling of the standard deduction for taxpayers who do not itemize and an increase in the child tax credit. However, they also rein in or eliminate existing tax deductions that benefit working class and middle class households.

This is driven above all by the need to keep the total ten-year deficit resulting from the legislation to $1.5 trillion. That limit must be met in order to move the tax overhaul on an expedited basis through the Senate, where the Republicans have only a 52 to 48 majority, ruling out a filibuster and enabling passage by a simple majority.

The House bill eliminates the federal tax credit for state and local income and sales taxes, but continues the write-off for state and local property taxes, capping it at $10,000. It reduces the existing tax reduction on mortgage interest payments as well as a tax break on medical expenses. It also eliminates tax credits for student loan payments and imposes a tax on graduate student stipends. These measures amount to a tax surcharge on workers, young people and the elderly to help pay for the tax boondoggle for the rich.

The Senate version calls for a somewhat different package of added tax burdens for the working class and middle class. It eliminates all state and local tax deductions but retains the tax credits for mortgage interest, student loan payments and medical expenses.

The Republicans are resorting to brazen lying to present the legislation as a boon to “hard-working middle class Americans.” Typical is an op-ed column published Friday in the Washington Post by Orrin Hatch of Utah, the chairman of the Senate Finance Committee. “For too long, middle-class Americans have struggled with stagnant wages, sluggish labor markets and economic growth well below the historic average,” he writes. “It is time to pay attention to those Americans who have felt left behind in economic stagnation, by providing tax relief and economic opportunity.”

The line is that corporate America will use the trillions in tax savings to buy new equipment, build new factories, hire more workers and raise wages. This ignores the fact that US corporations already have access to cheap credit, are making bumper profits, and are sitting on trillions of dollars in cash. It also ignores the past record of tax cuts for big business, whether under Reagan or George W. Bush, which pushed up stocks and the wealth of the ruling elite while accelerating the destruction of jobs and working class living standards. The same lying pretext was used to justify Obama’s bailout of the banks.

In fact, the extra trillions will be used to buy more and bigger yachts, private planes, mansions, penthouses, private islands and gated communities and bribe more politicians to do the bidding of the oligarchs.

One indication of the two-faced character of the Democrats’ opposition is the fact that interest groups backed by Republican billionaires such as the Koch brothers and Sheldon Adelson have thus far spent almost $25 million on TV ads to promote the Republican tax plan, while Democratic groups have spent less than $5 million to oppose the plan.

An updated analysis of the House bill published Wednesday by the non-partisan tax center spells out in detail how the tax overhaul is designed to sharply increase the wealth of the richest 5 percent, and especially the richest 1 percent and 0.1 percent, and vastly increase over the next decade the concentration of wealth at the very top.

Under the so-called “Tax Cuts and Jobs Act,” in 2018, taxpayers in the top 1 percent (with income above $730,000) will receive nearly 21 percent of the total tax cut, an average of about $37,000, or 2.5 percent of after-tax income.

Those in the top 5 percent income bracket, and especially the top 1 percent and top 0.1 percent, will get by far the biggest percentage gains in after-tax income. In other words, if you are among the very rich, the rate of increase you receive will be far higher than for the lower 95 percent. That means the plan is designed to widen the gap between the very rich and everybody else.

In 2018, the top 20 percent of income earners will get 56.6 percent of the total federal tax cut. Within the top 10 percent, the 90-95 percent group will get 7.4 percent of the total, the 95-99 percent group will receive 14.8 percent, the top 1 percent will get 20.6 percent and the top 0.1 percent will receive 10 percent. In other words, within the richest 10 percent, the benefits are skewed dramatically to the richest of the rich.

One decade out, by 2027, the transfer of social wealth to the very rich will be even more pronounced. In 2027, taxpayers in the bottom two quintiles (those with income less than about $55,000) will see little change in their taxes, with a tax decrease of $10-$40. Taxpayers in the middle of the income distribution will see their after-tax incomes increase by only 0.4 percent. Taxpayers in the top 1 percent will receive nearly 50 percent of the total benefit.

Someone in the top 1 percent will get a break of $52,780. Someone in the top 0.1 percent will get a tax cut of $278,370.

In total, 12.8 million households will have a bigger tax bill in 2018 under the law, including more than three million earning between $48,600 and $86,100. By 2027, more than 11 million households in this income group will see their tax bills increase. Overall, by 2027, 47.5 million households, a quarter of the total, will have a tax increase.