|Corporations get enormous benefits that regular “persons” do not. One of the biggest is limited liability. This means that the shareholders are not liable for the debts of the corporation. A corporation can get in a lot of trouble, financial and otherwise, and then just close up shop, divide its assets to its creditors, and the shareholders can just walk away losing only the money they originally put in. While it might be a “person” to certain members of the Supreme Court, there is no person to be made to work off the debt or to put in jail.
Corporations also enjoy lower tax rates than people do. (Except for the people who make a gain from the shares: they get a special, even lower tax rate called “capital gains.” Why is this? The capital gains tax rate is lower because the wealthiest make most of their income from capital gains, and the wealthiest make most of their income from capital gains because the capital gains tax rate is lower.)
And of course, corporate “persons” never have to die.
In return, we the people of the United States ask corporations to pitch in to help pay for the roads and courts and schools and scientific research and government contracts and the rest of the things that have helped make them the prosperous entities they are. But a number of American corporations are so fed up with the idea that should pay their taxes that they are actually renouncing their U.S. citizenship. These corporations are “leaving” the U.S. to dodge taxes—but their executives, employees, offices, stores, customers etc. are still here. The only thing that is really leaving the country is the requirement to pay U.S. taxes.
These corporations are able to “leave” the U.S. by engaging in something called inversion. Explaining an inversion is a bit complicated. A U.S. company buys or merges with a non-U.S. company, and the result is that the U.S. company can be considered to be a company from the other country. But at the same time the company keeps most of its operations, etc. inside the U.S. The result is that it might still owe taxes on income reported as made in the U.S., but it owes no taxes on income elsewhere.
Here are five companies—only a handful of the total—that have or are trying to renounce their U.S. citizenship to avoid paying taxes to help cover the benefits they receive.
1. Walgreens […] 2. Medtronic […] 3. Perrigo […] 4. Ingersoll-Rand […] 5. Eaton Corp […]
In early July the House passed an amendment by a vote of 221-200 denying federal contracts to American companies that have reincorporated in Bermuda or the Cayman Islands. This is not yet law, but is attached to the Energy/Water appropriations bill. It is a beginning, but only lists these two tax haven countries and won’t affect Walgreens, should it make itself appear to be a Swiss company.
The Stop Corporate Inversions Act of 2014 is a more comprehensive effort that “increases the needed percentage change in stock ownership from 20 percent to 50 percent and provides that the merged company will nevertheless continue to be treated as a domestic U.S. company for tax purposes if management and control of the merged company remains in the U.S. and either 25 percent of its employees or sales or assets are located in the U.S.”
Republicans will obstruct the bill. The Joint Committee on Taxation estimates that the legislation would save $19.5 billion over 10 years.
This would be a start toward fixing this problem. A small start, admittedly, but a start.
Activists to seek more attention for Nigerian girls on their 100th day of captivity.
Wednesday, July 23, marks the 100th day of captivity for the Nigerian girls abducted by the militant Islamist group Boko Haram. On the night of April 14-15, 276 girls were taken from the Government Secondary School in the town of Chibok. Since then, 57 have escaped, but 219 are still captives. Since they were taken, seven of their fathers have been killed in the siege of their town and four other parents have died from heart attacks and other stress-related ailments authorities are blaming on the kidnappings.
Nigerian President Goodluck Jonathan met with some parents and escaped girls Tuesday.
The Bring Back Our Girls Campaign has planned a number of Wednesday events in Nigeria and several other countries to focus renewed attention on the situation.
In the United States, a candlelight vigil will begin at the Nigerian Consulate in New York City at 4 PM ET. The purpose is to encourage the federal government of Nigeria to deploy more resources to bring the missing girls home. The consulate is located at 828 Second Avenue, New York, NY 10017.
You can learn more at the campaign's Facebook page.
Blast from the Past. At Daily Kos on this date in 2008—AK-AL: Palin scandal shakes up House race:
|Sarah Palin is the governor of Alaska, and a hugely popular one, with approval ratings hovering in the 90 percent range. She was even discussed as a potential VP pick for McCain.
Or, that used to be the case, as her administration is rocked by revelations that she and her family used the governor's office to carry out a vendetta against a policeman who was a former brother in-law, up to firing the public safety commissioner because he wouldn't fire the trooper. The top wingnut radio host in the state, a huge fan, has turned on the governor big-time, declaring her a one-term governor. The Republican-dominated state legislature is talking investigations. For a state party rocked by scandal, who had seen Palin as a savior—clean and new, this abuse of power scandal has to be crushing.
Palin doesn't face the voters for another two years, but this scandal has more immediate aftershocks.
We all want Rep. Don Young in the general, as his years of corruption have caught up to him. Polls are showing that Alaskans want change, and Democrats are poised to pick up the seat. Threatening those plans are a competitive Republican primary, as the GOP desperately tries to oust Young and replace him with a less tarnished name.
Lucky for us, two Republicans entered the fray, splitting the anti-Young vote. But one of those two was a top contender—Lt. Governor Sean Parnell. Can you see where this is going?
On today's Kagro in the Morning show, following historical precedent, Republicans who predicted doom in the passage of Social Security, Medicare and Medicaid, the Clinton budget & stimulus program, and the Obama stimulus plan, and were wrong on each count, are now also wrong on predictions of skyrocketing premium costs under the ACA. Greg Dworkin discusses this, GA-Sen., Schumer's op-ed backing "top-two" open primaries, and the still-imaginary Elizabeth Warren candidacy. Later, we respond to listener comments, critique the Schumer op-ed, announce the Halbig news, and clarify yesterday's information about Iceland's protest political party, the "Best Party."