Next Big One: Repatriation Tax Holiday Giveaway To Corporations

Here comes the next big one. Now that the corporations have fast-track trade authority in the bag, they are trying to push a huge, huge tax giveaway through Congress. We have to get the word out so this doesn’t just sneak through. We can’t let them continue to rig the system against us like this.

Up To $770 Billion Is Owed On $2.2 Trillion In Corporate Profits Stashed In Tax Havens

You might have heard about all that money the giant corporations have been stashing in tax havens so they can dodge paying their taxes. You might not have heard how much they owe us. Corporations have somewhere around $2.2 billion of “offshore” profits stashed in tax havens. They owe up to 35 percent in taxes on that money. That’s right; they owe up to $770 billion that We the People could have right now for our roads, schools, health care, scientific research, space exploration, to forgive student debt … we could have free college tuition, expand Social Security, high-speed rail across the country…. Instead, we’re told we can’t have these things because there are “budget deficits.”

And on top of that, at least another $50 billion per year of tax money is kept from us because of this scam.

Congress could just tell these corporations to pay up, and We the People would have up to $770 billion to use to make our lives better, and another $50 billion or more each year.

See if you can guess what Congress is getting ready to do instead?

Tax Holiday

Right now the giant, multinational corporations owe up to $770 billion in taxes on the $2.2 trillion they are holding outside the country in tax-haven mailbox subsidiaries. Right now. They have the cash in the bank (in tax-haven countries) and could write checks tomorrow if Congress told them to. Again, this is taxes they already owe but haven’t paid. Think of the things our country could do with that money.

But instead …

Congress is proposing to give these companies a tax holiday and let them off from paying the taxes they already owe on that money. There is all kinds of complicated language being used to mask what is happening, but it’s really simple: Some members of Congress are proposing letting them off from the taxes they already owe on “offshore” profits, and then letting them off from paying taxes on future profits made “outside the country” from now on.

For example, the Charles Schumer-Rob Portman bill in the Senate will tax this money (on which 35 percent is already owed), “at a rate significantly lower than the statutory corporate rate.” And then it will cut tax rates on future “offshore” profits forever.

Quick question: For years these companies have been moving jobs, production and profit centers out of the country to take advantage of this tax dodge. If they are rewarded for this with this huge tax cut, how many more companies will move jobs, production and profit centers out of the country from now on? Bonus question: Will there be any jobs, production or profit centers left inside the U.S. if Congress lets companies off the hook from taxes on profits made from moving jobs, production and profits centers out of the country?

Don’t Let this Sneak Past Us

The corporations and billionaires count on these things sneaking through under cover of complicated language, so we never find out what is happening to us. Later they tell us “we’re broke” and there is no way to “pay for” things like roads, schools, and other needs. They tell us we have “deficits” that could “bankrupt” us, so college tuition has to go up, we have to pay to use toll roads, they have to cut funding for schools, we can’t have high-speed rail, they can’t afford to do scientific research or space exploration or fight global warming or fix up national parks, and so on.

But what is really going on is the game is being rigged. Corporations get huge tax breaks and subsidies, a few billionaires and plutocrats get the cash, and We the People, the 99 percent, have to make up the difference.

We need to get the word out about this. This is the next big one they are trying to slip through before we know what is happening to us.

We have to fight this. We have to make noise. Even if we don’t win this, at least we will know what happened this time. Then, later, when they come back and say there’s no money to do things that make our lives better, we will be able to see through the smokescreen. We will know where the money went, and eventually enough people will understand how the game is being rigged – and stop it.

Congress should tell the giant, multinational corporations that it is time to pay the taxes the already owe on “offshore” profits. They should not reward companies for moving jobs, production and profit centers out of our country.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Was Greece Lured Into “Strategic Deficits”?

The job of a lender is to evaluate risk and price a loan accordingly. If there is risk you charge a higher interest rate. That way you still make money on a broad portfolio of loans even when there are a few defaults.

That’s the job of a banker, supposedly. It’s what they are supposed to be good at. If they are bad at their job, give loans to deadbeats (or countries that can’t pay you back) you lose money, and probably shouldn’t in the business of being a lender.

The lender is supposed to evaluate the risk and say no if the borrower is irresponsible, not complain later about the borrower being irresponsible.

Unless their job is to get the borrower in over their head so you can get stuff. As in “Confessions of an Economic Hit Man.” In that case you try to get governments to borrow, you even bribe the leaders of governments to borrow like crazy so you can later control whoever is then in charge. From “Confessions of an Economic Hit Man“:

We are an elite group of men and women who utilize international financial organizations to foment conditions that make other nations subservient to the corporatocracy running our biggest corporations, our government, and our banks. Like our counterparts in the Mafia, EHMs provide favors. These take the form of loans to develop infrastructure – electric generating plants, highways, ports, airports, or industrial parks.

… Despite the fact that the money is returned almost immediately to corporations that are members of the corporatocracy (the creditor), the recipient country is required to pay it all back, principal plus interest. If an EHM is completely successful, the loans are so large that the debtor is forced to default on its payments after a few years. When this happens, then like the Mafia we demand our pound of flesh.

Former president Ronald Reagan, for example, said he was trying to run up the borrowing in order to force the government to cut back on things it does to make our lives better. He cut taxes, increased military spending, a strategy called “strategic deficits.” (Google that.)

Later we had budget surpluses under Clinton. Then Federal Reserve chairman Alan Greenspan complained that the government was paying off the debt too fast. Then “W” Bush cut taxes and doubled military spending and said it was “incredibly positive news” (Google that, too) that the government was going back into deficits because it would force spending cuts.

Strategic deficits. Done on purpose. Are Greece’s lenders bad at their job? Or are they good at a different job?

Atrios earlier:

“You lend money at a risk premium. Borrowers pay that risk premium for a reason. That reason is that they might stop being able to pay. Then you eat the loan.

… The banksters are supposed to be genius financial intermediaries, properly pricing risk and making loans accordingly. It seems that they aren’t very good at their jobs? I suppose it depends on whether that really is their job.”

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

In Tax Battles, “Competitiveness” Means Coercion

Watch out for this one. With fast track trade authority done, the big corporations are now pushing for massive tax giveaways. This is another exercise of raw corporate power by the few to take what they want from the many. The corporations use complexity to get people to tune out, and their schemes are masked by smooth words like “reform” and “competitiveness,” but it is all just another grab for (even more) money and power.

There are two areas where the corporations are coming at us. The first is a blatant grab to keep somewhere up to $700 billion in tax money they already owe on “offshore” profits. The second is a push to permanently cut corporate tax rates – even more.

Taxes Owed On Offshore Profits

Multinational corporations avoid paying U.S. taxes using a “deferral” loophole. This loophole lets them dodge taxes on profits made outside of the country until they bring the profits back into the country (called “repatriation”).

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Wall Street And Big Corporations Got What They Wanted – This Time

Fast track passes. Our Congress – the supposed representatives of We the People – voted to cut themselves and us out of the process of deciding what “the rules” for doing business “in the 21st Century” will be.

How do the plutocrats and oligarchs and their giant multinational corporations get what they want when a pesky democracy is in their way? They push that pesky democracy out of their way.

Because of fast track, when the secret Trans-Pacific Partnership (TPP) and any other secretly negotiated “trade” agreements are completed Congress must vote in a hurry with only limited debate, cannot make any amendments no matter what is in the agreement, and they can’t be filibustered. Nothing else coming before our Congress gets that kind of skid-greasing, only corporate-written “trade” agreements – and it doesn’t matter how far the contents go beyond actual “trade.”

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Will TPP Kill The Post Office?

Corporations are notorious for sneaking things into laws and regulations before the public can find out and rally to stop it. And we know from the conservative Supreme Court arguments against the Affordable Care Act that even what amounts to a typo can be used to change the obvious meaning and intent of a law.

These are reasons we need to see the text of the Trans-Pacific Partnership before Congress votes to preapprove it with fast track trade promotion authority (TPA). They are pushing what is literally a pig in a poke on us. We the People need to open that bag and have a good, long look inside before fast track buys the TPP pig in our name.

Negotiated in secret by corporate representatives, it is probable that the Trans-Pacific Partnership (TPP) is loaded with things the big corporations have snuck in. We already know from leaks that TPP contains provisions allowing companies to sue our government in “corporate courts” if they feel a law or regulation is cutting into their profits. What else is in there?

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Fast Track Hits House Next Week; Clinton Must Speak Up

The House is expected to vote on fast track trade promotion authority as soon as next week. If it passes, the corporate-negotiated Trans-Pacific Partnership (TPP) is a done deal — even though it is still secret. Why is presidential candidate Hillary Clinton still silent on this?

The Money Wants TPP — The People Do Not

TPP is the most important economic issue facing the Congress between now and the election — because it could happen, and because if it does the results will be terrible for working people. The game will be further rigged in favor of the 1 percent and against the rest of us. It will increase corporate power over governments — and us.

The Money wants TPP, because it will be very, very good for them. The people do not want fast track/TPP because it means increased corporate power, fewer jobs, more pressure, and lower pay.

A corporate/plutocrat-bought Congress is being told by The Money — Wall Street, the giant corporations and the plutocrats — to pass it, and for some incomprehensible reason President Obama will sign it. Street-level activists are fighting tooth and nail to get the word out and rally opposition. This is now. This is urgent. This is the focus.

This is an either/or. There is one side, and there is the other side. This is us vs. them. This is The Money vs. We the People. There is no in-between on this one, no waiting it out, no holding back, and no fence-sitting. It is one or the other. Not choosing a side on this is really just choosing the wrong side.

Clinton Still Silent On Fast Track

Here’s the thing: Fast track essentially pre-approves TPP. Fast track comes up for a vote as soon as next week. If fast track passes, TPP is a done deal. Where is Clinton on this?

Hillary Clinton is the leading Democratic candidate for president. A lot of activists are looking for reasons to enthusiastically support Clinton’s candidacy. She has taken great, progressive positions on immigration and other issues. But it is still early; opinions are not yet hardened. Things can change.

So far Clinton is trying to stay on the fence about fast track and TPP:

“There are questions being raised by the current agreement. I don’t know what the final provisions are yet,” she said. “I want to judge the final agreement. I have been for trade agreements, I have been against trade agreements.”

But fast track preapproves that “final agreement.” The vote on fast track in the House could be as soon as next week. After next week, TPP could be a done deal. Clinton owes it to the public to show up and lead on this. She especially owes it to the activists. They are fighting in the streets over this. They would appreciate some help. They will remember who was there with them — and who wasn’t.

Political Calculation vs. The Right Thing

Clinton’s advisors are calculating that this whole controversy will fade away after fast track’s passage makes TPP a done deal. They are trying to get her past this without taking a stand that risks putting off either side. They are betting that with time people will forget and get over it.

But to the activists on the street, this is the big one — just like the Iraq War vote was. People will remember, because people who know about it are fighting in the streets today, doing everything they can to stop this. And those people will say that taking no position is the same as being for it, because it is allowing it to happen, without laying down in front of the moving fast-track train.

Some people care about the issues, not the horse race. They care about substance, not image. Not everyone cares, to be sure, or is even paying attention yet. But in the long run the positions are what will matter, not the day’s calculated image. This is because the results of this will not fade away; they will matter to people’s lives.

For example, Nike wants TPP because it lowers the tariff on shoes imported from Vietnam and Malaysia. But when this forces New Balance to shut down their U.S. manufacturing, that will be in the news, people will feel it, and they will look back and say “Where was Clinton?”

The Iraq War vote looked like the pragmatic political position to take, but that political calculation came with a cost in the long run because the consequences of that vote mattered to people’s lives. Doing the right thing comes with a reward in the end.

Sitting back and hoping important issues just go away won’t cut it this time. You can’t make it just go away. Better yet, the way to make it just go away is to grab it by the horns and move it in the right direction.

Looking For A Champion Who Pushes For Transformative Change

People are impatient for a real champion. This is not a time to be safe, sit back, read polls, and wait out controversy. The economy simply is not working for most of us, and people know it. People see that the game is rigged and want proposals for transformative change.

There is no question that TPP is on the wrong side of this, and will result in even more hardship for the very people Clinton says she is campaigning to help. Fast Track preapproves TPP and the vote is coming up very, very soon.

Staying on the fence on this one is a mistake. By staying on the fence she risks being remembered as “No-Position Clinton” on the issue that matters most.

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This post originally appeared at Campaign for America’s Future (CAF) at their Blog for OurFuture. I am a Fellow with CAF. Sign up here for the CAF daily summary and/or for the Progress Breakfast.

Obama To Visit Nike To Promote TPP. Wait, NIKE? Really?

President Obama is scheduled to visit Nike’s Oregon headquarters on Friday to promote the Trans-Pacific Partnership (TPP). Yes, Nike – a company that grew to billions by outsourcing jobs to overseas sweatshops, a company that sets up P.O.-box subsidiaries in tax havens to avoid paying U.S. taxes, a company that uses threats to extort tax breaks from its “home” state.

Phil Knight, head of Nike, is now worth $23 billion because America’s trade policies encourage companies like Nike to create and move jobs outside of the U.S. The 23rd-richest American is one more symbol of the kind of inequality that results from outsourcing enabled and encouraged by these trade policies. Workers here lose (or never get) jobs; workers there are paid squat; a few people become vastly, unimaginably wealthy.

Meanwhile Massachusetts-based New Balance struggles to manufacture its athletic footwear in the U.S. TPP will remove tariffs on imported Vietnamese and Malaysian shoes, benefiting Nike and wiping out New Balance’s efforts to maintain its manufacturing here.

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Death To Pensions – Video

From AFSCME:

ENRON BILLIONAIRE ARNOLD HAS A PROBLEM WITH LIBRARIANS’ PENSIONS
Former Enron trader and hedge fund billionaire John Arnold is launching a multimillion dollar national PR campaign attacking the hard-earned pensions of public sector workers. Arnold has already quietly poured tens of millions of dollars into his efforts to persuade politicians to reduce middle class retirement security and now it looks like he may really just be getting started.

A Look At The Fast Track Bill Shows It’s The Wrong Thing To Do

The “fast track” trade promotion authority bill has been introduced in the Senate. Article 1, Section 8 of the Constitution says, “The Congress shall have power to … regulate commerce with foreign nations.” But under fast track, Congress relinquishes that power and agrees to pass trade bills brought to them by the executive branch in a very short time frame with little debate and without making any changes should any problems present themselves.

Though it was announced that this year’s fast track bill was the result of a “deal” between Sens. Ron Wyden (D-Ore.) and Orrin Hatch (R-Utah) the 2015 bill is nearly identical to the 2014 bill that died in Congress without support for a vote. See this side-by-side comparison from Rep. Sander Levin of the House Ways and Means Committee. It is unclear from this comparison why the “negotiations” between Hatch and Wyden took so long, and what Wyden got that enabled him to put his name on it, enabling the bill to be sold as “bipartisan.”

Fast Track Sets Aside Normal Procedure

Congress does not set aside normal procedure, debate, the ability to fix problems that turn up and agree to vote within 90 days except for trade agreements – even though trade agreements have now proven to have such a tremendous and often detrimental effect on our economy, jobs, wages and inequality. Where did the idea to do this come from? According to Public Citizen, this unusual procedure was “initially created by President Richard Nixon to get around public debate and congressional oversight.”

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Silicon Valley Rising Fights for Worker Justice

Silicon Valley is an area of contrasts. When you stop at a traffic light in Silicon Valley you will often find a Maserati or Tesla on one side of you and a beaten up, 15-year-old Accord on the other. It seems there are more high-end Mercedes, Jaguars, Bentleys or the occasional Maybach than in other areas.

Silicon Valley companies, many run by stock-billionaires, pay a lot at the top, and squat at the bottom. There are the lucky employees, and a huge number of “contractors” – employees who are not called employees. The employees that reach over a certain age are discarded.

There are not a lot of people in the space between Silicon Valley’s top and its bottom. One in three Silicon Valley workers cannot even afford to live anywhere within a one-hour drive. The regular three-bedroom house costs a million dollars and don’t even ask about the rents (starting at more than $2,000 a month for a one bedroom apartment), but on the streets in working-class neighborhoods there are so many cars parked that you can barely pass – because there are so many people and families crammed into the housing. And, of course, the traffic is terrible, but you have to use a car because public transportation is cut back due to tax-dodging by giant companies like those in Silicon Valley.

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