Fortune 500 firms may have avoided $620B in recent taxes

A new Citizens for Tax Justice / US PIRG study of IRS/SEC filings indicates that 358 of the 500 largest companies in the United States are stashing $2.1 trillion in legal tax havens.

The lost U.S. tax revenue from just 57 of them who admitted the difference in what they would have paid on those profits without havens versus what they actually paid (legally!) was $184.4 billion in total. The report then extrapolates that the lost U.S. tax revenue from the full Fortune 500 due to offshore tax avoidance may be around $620 billion total, or $90 billion yearly over the period in which the untaxed offshore stash was earned.

The tax haven countries themselves often have yearly GDPs smaller than the profits supposedly being “earned” in those countries by the “subsidiaries” of US megacorporations “based” in those countries.

Also:

Between 2008 and 2014, the study added, the amount of offshore cash holdings for American multinationals doubled.

 
Ah, I guess big U.S. firms can’t hire more people or pay better wages (duly earned through higher productivity!) because they “only” have over $2 Trillion in offshore savings. You see, it’s very tough as American megacorporations to pay living wages when you’re collectively only avoiding $90 billion a year in taxes.

Meanwhile, a major Democratic Party candidate for president wants to give tax breaks to big firms to pay workers more fairly, even though they already legally skip $90 billion annually in taxes now.

This is ludicrous. You don’t pay companies to do things they need to do anyway. You really don’t do it when they’re effectively stealing tax revenue now. As the head of the World Bank just said, legal tax avoidance schemes are a form of corruption. This needs to end. It just does.

Revisiting the Mayflower Compact, 395 years later

Cape Cod and Plymouth (NASA Satellite image, April 1997)

Cape Cod and Plymouth (NASA Satellite image, April 1997)

In November 1620, the Mayflower was bound for Virginia but found itself diverted by storms to what is now Massachusetts. The leadership on board made a decision to establish a colony there instead of attempting to continue to the Mid-Atlantic. They also made a hasty decision to draw up their own emergency charter for a new, separate colony. While this may have been a bid to retain control over a ship full of passengers who weren’t all part of the religious mission or colonial vision of the elites leading the mission, the result was the Mayflower Compact. The lost original document likely occupied a single page in large handwriting. Yet in that limited space, it explained the premise and goal for any future governmental structures or laws in the colony: a just and equal self-governance dedicated to the common good.

We also know approximately what it said. Here is an excerpt from the core of The Mayflower Compact:

“Having undertaken, for the glory of God, and advancement of the Christian faith, and honor of our King and Country, a voyage to plant the first colony in the northern parts of Virginia, do by these presents solemnly and mutually, in the presence of God, and one another, covenant and combine our selves together into a civil body politic, for our better ordering and preservation and furtherance of the ends aforesaid; and by virtue hereof to enact, constitute, and frame such just and equal laws, ordinances, acts, constitutions and offices, from time to time, as shall be thought most meet and convenient for the general good of the Colony, unto which we promise all due submission and obedience.”

 

While that’s pretty easy to read for an early 17th century charter, it also certainly is still a bit confusingly written and “old-timey.” Here is my attempt at a somewhat cleaned up and streamlined paraphrasing of the key objectives that could also be applied in a more general context:

Those present — solemnly and mutually, in the presence of one another — covenant and combine ourselves together into a civil body politic, for our better ordering and preservation. [For this purpose, we pledge to] enact, constitute, and frame such just and equal laws, ordinances, acts, constitutions, and offices as shall be thought most convenient for the general good, unto which we promise all due submission and obedience.

 
This, in essence, means that government is a mutual compact between a collective of people. They promise each other that this government will be dedicated to establishing order in and ensuring the survival of society. To achieve this, the government must be based on laws, ordinances, acts, and structures which apply equally and justly to everyone in the society and which promote the “general good.” And to make it all work, everyone promises to submit to this rule of law and follow the order established by this collective government, as far as was reasonable to expect. (The words “all due” before “submission and obedience” — in my opinion — qualify that it is not requiring unlimited obedience without challenge to unjust authority.)

At the time, of course, they meant this self-government really to apply to wealthy and free men aboard the ship. But as you can see, they never actually specified that in the text. Thus, these become universalizable principles for participatory collective self-governance in a free, fair, and just society for the promotion of the common good and common self-preservation.

The Compact is so simple, brief, and non-specific that its core elements — with very few points removed — can apply to any society that wishes to adopt its principles.

It is a bold and noble compact with one another that we the people would do well to renew, as we approach its 400th anniversary in 2020.

AFD Micron #37

If you think acknowledging America’s awful history of slavery, genocide, and discrimination necessitates that you don’t love America, then guess what? You don’t love America! Because those things did, in fact, actually happen. So to call someone out for discussing them is less a sign that they don’t love America than a sign that you only love some vague, nonexistent fantasy version of America, and find the real thing detestable.

arsenal-micron-logo

Immigration & Nationality Act of 1965 turns 50

statue-of-liberty-Daniel-Schwen

Although it didn’t take effect until 1968, the Immigration and Nationality Act of 1965 was signed into law on October 3, 1965 — 50 years ago today — by President Lyndon Johnson. It was instrumental in transforming the racist eurocentric immigration quota policies that preceded it into a truly global immigration system focused on worker skills and family reunification.

However, as The Atlantic explained this week, the latter point was almost accidental — and its effect was unanticipated. The White supremacist faction in Congress at the time, disappointed in the abandonment of explicit national quotas, introduced family reunification in the hopes that it would encourage recent European immigrants to bring their extended families over and thus keep the balance of immigration overwhelmingly White and European. Instead, it created a beachhead for so many other countries’ migrants to make a new home in America.

In the subsequent half century, the pattern of U.S. immigration changed dramatically. The share of the U.S. population born outside the country tripled and became far more diverse. Seven out of every eight immigrants in 1960 were from Europe; by 2010, nine out of ten were coming from other parts of the world.
[…]
The heightened emphasis on family unification, rather than replicating the existing ethnic structure of the American population, led to the phenomenon of chain migration. The naturalization of a single immigrant from an Asian or African or Hispanic background opened the door to his or her brothers and sisters and their spouses, who in turn could sponsor their own brothers and sisters. Within a few decades, family unification had become the driving force in U.S. immigration, and it favored exactly those nationalities the critics of the 1965 Act had hoped to keep out, because those were the people most determined to move.

 
The large numbers of African, Middle Eastern, and South Asian immigrants and naturalized citizens in the United States today are here thanks in large part to the family reunification provisions passed in 1965.

Half a billion dollars of US spending evaporated in Syria

There’s one important fact to know in light of recent headlines about Russia’s Air Force bombing US-trained fighters in Syria, which I have pulled from the news from about two weeks ago…

AFP:

Only four or five U.S-trained Syrian fighters remain on the battlefield against ISIS militants, the top U.S. commander in the Middle East acknowledged Wednesday in the face of withering criticism from senators who dismissed the training program as a “total failure” and demanded a change of strategy.

Gen. Lloyd Austin told the Senate Armed Services Committee that the U.S. is looking at better ways to deploy the Syrian forces, but he agreed that the U.S. will not reach its goal of training 5,000 in the near term.

Wall Street Journal:

If the Pentagon shifts course to focus on training small numbers of fighters, it would represent a reversal. The military has criticized the Central Intelligence Agency’s lackluster covert effort to train Syrian rebels as ineffective because it produced too few fighters.

When the Obama administration shifted the main training program to the Pentagon, the military sought to train 5,000 Syrian rebels by year’s end. But the program has been slow to get off the ground and the first group of 54 fighters to enter Syria this summer was quickly routed by rival fighters.

 
There’s a second important fact. Here’s the Wall Street Journal on the cost of the failed program:

Under one proposal being crafted at the Pentagon, the $500 million train-and-equip program—a core component of the U.S. Syria strategy—would be supplanted by a more modest effort focused on creating specially trained militants empowered to call in U.S. airstrikes, defense officials said.

 
But at least we had wasted it *before* the Russians bombed the last few guys. Al Qaeda’s Nusra Front took care of that.

The foreign policy community, united for a common error

A brief reflection on 14 years of continuous US misadventures in the Middle East North Africa region and the mainstream foreign policy community’s exclusion of alternative perspectives.

In its cross-partisan drive for a new style of foreign policy after the Cold War, the DC crowd seems to have converged upon the worst-of-all-possible-worlds solution to the world’s problems.

From the left, the military-internationalists without a balancing dose of any hardheaded, restraining realism. From the right, the neocons and literal “crusaders,” whose force-based adventurism is sure to end about as dismally as their medieval forerunners.

Both believe unlimited force applied everywhere can remake the world in their vision, yet the vision is as clouded by legacy alliances and enmities as any prior world power’s vision has been. They cannot even plausibly claim to have transcended the obvious immorality of the frequent pacts-with-devils made by Cold War realpolitik advocates.

Witness the negligible self-reflection on ill-conceived partnerships with Saudi Arabia’s regional wrecking-ball (or other similarly damaging alliances). Witness the beliefs in “good guys” and “bad guys” and meaningful change through isolation, bombardment, and speeches.

It is a foreign policy worldview as averse to compromises for the sake of reality as the members of Congress. Yet it already so pre-compromised and impure as to render the ideals behind it a hollow joke.