[Hi, friends: a little late this week due to work crush…to punish me, if everyone signs up ONE more person you know to this newsletter, just think of how many extra people could give me grief when I slack]
The answer is, Mr. President: these 55 profitable corporations paid ZERO taxes or less (“less”=you and me gave them a honking big refund). Nice legal robbery if you can do it, huh? This we know thanks to the usual outstanding work of my friends at the Institute for Taxation and Economic Policy (ITEP), who everyone should follow. Here are the facts in a nice table:
Here are a few points from ITEP:
And some context:
Number 1: this isn’t new per se. There is a very, very long history of corporate legal thievery. It’s robbery that David Cay Johnston called “Perfectly Legal”—and it’s robbery engineered by our truly screwed up campaign finance system because these corporate mostly white dudes just buy off politicians of both parties to write tax laws that let them pull off this annual heist.
Number 2: The CARES Act, ironically, made this heist worse. Again, ITEP (“TJCA” refers to the 2017 GOP Robbery Tax bill also known as the “Tax Cuts and Jobs Act”):
Number 3: somewhat related and just because it gives me another opportunity to slam Jeff Bezos—Amazon has been one of the worst legal tax cheats (I used the word “cheats” intentionally because Amazon, and others, are effectively cheating you and every other regular person by forcing more tax burden on to average wage earners). So, when Jeff Bezos declares he supports raising the corporate tax rate, remember that (a) he doesn’t ever say to what LEVEL and (b) he’s already pocketed so much money from dodging taxes for years, and holding local and state governments hostage for more tax breaks in return for Amazon setting shop in town, that the level the federal corporate tax rate will likely to rise to will never claw back what Bezos already made off of every taxpayer.
Which leads me to: in my humble opinion, Joe Biden is making a big mistake by seeking to raise the corporate tax rate to 28 percent, up from the Trump tax plan rate cut to 21 percent—which is still way below the 35 percent rate pre-Trump.
When I ranted about this the day it was announced, Matt Gardner of ITEP wrote me: “Dude’s taking no prisoners with the international stuff though. 21% on all offshore profits is a lot bigger than what we’re doing now. And while it depends on the details, 28 percent with a good minimum tax backstop could be a hell of a lot better than 28 percent with no minimum tax.”
First, big props to Matt for referring to POTUS as “dude”. Second, Matt has a point, explained further by his ITEP colleague Steve Wamhoff:
And I also am aware that even the 28 percent rate is getting a lot of heat from Fifth Columnist Joe Manchin, who never met a corporate donor he wouldn’t get down on his Senatorial knees to pleasure. And Biden needs, as you’all know, every Democratic vote to stay with him.
BUT: the job of a president—at least a president who is pretending to be transformative—is to set the highest bar possible and use the bully pulpit to show people reality, though setting the rate at 28 percent does illuminate the contours of Biden’s (narrow) economic philosophy which has always been quite clear, separate and aside from the need to respond in a large fiscal way to the pandemic.
And the reality, as this graph shows, is that corporate tax revenues as a share of the gross domestic profit has been a pretty steady overall decline over several decades.
Raise that rate. And raise it high!