Americans for Tax Fairness does a pretty devastating take-down of the group of CEOs who were at the New York Stock Exchange Thursday ringing the opening bell under the banner “Fix the Debt.” Their picture makes the point:
According to their researchers, here is what you need to know about the people who are pointing the fingers at us to “fix the debt”:
♦ Thirteen out of about 80 CEOs and companies that signed a letter urging Congress to Fix the Debt have milked the federal tax system out of tens of billions of dollars, according to an analysis by Americans for Tax Fairness. Another six companies that signed the letter are leading proponents of a tax amnesty for corporate profits shifted out of the United States, especially profits shifted to offshore tax havens.
♦ Five of the corporations whose CEOs signed the Fix the Debt letter paid ZERO federal income taxes on $62 billion in total profits and received $27 billion in tax subsidies over the last four years according to Citizens for Tax Justice.
♦ Eight of the CEOs who signed the Fix the Debt letter reaped a total of $11.8 million in tax breaks last year from the Bush tax cuts (see table below). They are among 57 CEOs who each received more than $1 million in such tax breaks, collectively securing more than $100 million in tax cuts according to the Institute for Policy Studies.
♦ Six of the corporations whose CEOs signed the Fix the Debt letter were members of the WIN America Coalition, which lobbied Congress to pass legislation (S.1671) that would allow U.S. companies to dramatically reduce their tax rate on $1 trillion in foreign profits brought back (“repatriated”) to the United States. The measure would reduce the 35 percent corporate tax rate to an 8.75 percent effective tax rate on the repatriated profits. The six corporations are: CA Technologies, Cisco, Loews Corporation, Microsoft, NASDAQ OMX Group, Inc., and Qualcomm Inc. Many of the corporations pushing for repatriation also want to permanently exempt offshore profits from U.S. taxation, by adopting a so-called “territorial” tax system, which would only increase the incentives to shift jobs and profits offshore.
These are just some of the reasons why these corporate leaders have no credibility when they blather on about “fixing the debt.” They bankrolled the politicians that created the debt through a tax system that gave them myriad ways to avoid paying their fair share to support the country. Then they shipped good-paying jobs overseas and depressed the wages of the jobs left behind so that workers had less that they could afford to pay in taxes as well. All in the name of shareholder value.
There is a way to fix the debt, but it is not their way. If CEOs are willing to push for policies that will actually create good jobs in America, expand the middle class and distribute the tax burden more fairly—so that CEOs aren’t paying a lower percentage of their income in taxes than hourly wage-earners—then they stand a better chance of gaining some credibility with the rest of us. But not so long as they are the major part of the problem.
This post has been updated to correct the name of the organization doing the study, Americans for Tax Fairness.