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From the live on-air transcript:
The way the European Union is looking at Apple — the European Union is nothing but a bunch of takers. The European Union wouldn’t know how to produce diddly-squat.
So Apple is the golden goose. And they’re taking as many eggs from the golden goose as they can, because they’re out of money. All these brilliant socialist Democrats in Western Europe, all these elites, these pointy-headed intellectuals, our so-called betters, can’t manage anything. And they have been out of money for years. They don’t know how to budget. They don’t know how to behave responsibly.
So here comes Apple, and it’s a big pile of money and they can go get it, and Apple’s just the first. And the interesting thing about this is who does Tim Cook sidle up to? The very people who want to do this to his company… Look, I don’t have a dog in this fight. I’m just telling you that Apple set themselves up according to Irish law. So they set themselves up according to Irish law. But, folks, you can have one or the other but you can’t have both. You can either have confiscatory taxation like this or you can have jobs. The problem with leftists is they think you can do both. They think they can tax the golden goose as often and as highly as they want, and that the golden goose is gonna keep producing. Because they’ve never been in that sector of life where the golden goose lives.
All they are is a bunch of takers, a bunch of people in government with power to take. But you put on them the responsibility for innovation, creation, productivity, invention, and you’ve got nothing, because they are clueless. So they come along and they start demanding all this. And then they start demanding jobs, and you have to choose one or the other. Confiscatory taxation or jobs. What do you want?
But there’s another aspect to this that isn’t being reported, and that is the anti-Americanism of this, the EU. All this globalism, Obama and his cronies trying to tell us that globalism is the future and that the US was gonna be once again loved and respected once Obama was there and George W. Bush was jettisoned, and now this? This woman [Margrethe Vestager] delighted in screwing the screws tighter to an American corporation, and the US and Obama did everything to try to stop her from doing it, and she relished it all the more. Ha.
You know what the Apple cash pile is right now? It’s $231 billion and climbing. I mean, it’s profit, yeah, but that’s how much they’ve made that they have not reinvested, and their R&D budget is huge. It’s just a phenomenal pile of money. You know how much of that $231 billion is being held overseas? About $210 billion of it. It is striking… But you know why $220 billion of it is overseas? It’s not strictly because Apple is a global corporation; it’s because of the US tax rate. The United States has the highest business tax rate in the world, 35%. So Apple received favorable tax proposals from European countries, including Holland and Ireland, because they wanted jobs, they wanted an economic boost, and they offered Apple attractive tax packages, which is common.
I mean, you can make the argument Apple has the duty to shareholders to maximize profits, so as to maximize stock price and dividends if they pay it. All that, of course, is true. But it just makes sense anyway: It’s Apple’s money. It isn’t the European Union’s money. It’s not Barack Obama’s money or John Kerry’s or Hillary Clinton’s; it’s Apple’s. But if you’re Elizabeth Warren, you come along and say, “You didn’t build that. You didn’t build that iPhone. We made that possible for you,” all that rotgut rigmarole.
So the European Union is like any other massively bloated, overweight bureaucracy: It’s out of money. They can’t manage their own finances. They have the ability to take money from anybody, anywhere, any time. It’s called taxes and fees and taxes and fees and user fees and who the hell knows what all mechanisms, and even at that they’re broke. And it’s typical; the people who do not work and who have nothing to do with the production of the money they have, have no appreciation for how it was acquired.
If you can get money by taking it from other people, you’re gonna think you can always get money by taking it from other people. And if you have a lot of money and you’ve never earned it, guaran-damn-teed you are never going to appreciate the value of that money. And that’s government for you. Government confiscates wealth. Government does not create wealth, pure and simple. “Wait a minute, Rush. What about defense contracts?” Well, the government’s not doing the work, and it’s taxpayer money to begin with. It isn’t government money. Government doesn’t produce jack. All government does is get in the way. Government could do much more than they do by getting out of the way.
…What goes into making that phone a reality is beyond most people’s comprehension. Apple’s supply chain is massive, it is intricate, and it is one of the most well-oiled machines in and of itself in all of American corporate life. They’ve got it down pat. When Apple is on a roll, you know how often they turn over their inventory? I’m talking about everything, iPhones, iPads, Macintosh computers, whatever. When Apple is humming, they turn over their inventory every eight days. Stop and think of that, worldwide. To have your manufacturing down so that you’re not saddled with a big bunch of inventory you’re holding onto, which just drags down everything, it slows manufacturing, it slows everything in the supply chain, it slows down the profitability of all your suppliers. To be able to have your manufacturing such that you’re able to turn total inventory five to eight days in a global circumstance is just phenomenal.
For these governments to come along and try to claim that Apple’s cheating here and cheating there, it’s typical. Anyway, what has to happen, Apple’s gonna appeal this, so they have to put the money — it’s about $13 billion euros, translation to $15 billion. They have to put the money in escrow. Some of that $15 billion is interest and penalties on the original base amount that the fine is.
So Apple will appeal, and it goes on. It’s gonna be years before this is solved. It’s not gonna have any immediate impact on the Apple stock price. It’s just government doing what government does, particularly these clowns in the European Union, who are just inept.
Well, anyway, I was reading my tech blogs about this today. And the tech blogs are young Millennial, and younger, journalists. And I want to read to you just one excerpt from one of them. I mean, I could probably find this thinking in all of them.
“Apple likes to present itself as a friendly, open company that is on the side of consumers. Yet here it is arguing that its complex financial arrangements, which serve to dramatically reduce its overseas tax bills, are justified. It does this at a time when the public mood is very much against such maneuvering.” – Ben Lovejoy, 9to5Mac
Oh, okay. So the public mood is against responsible fiscal behavior. So what should Apple do?
Given than Apple isn’t short of cash by any stretch of the imagination, why doesn’t it simply take the moral high road and voluntarily pay the taxes that it really believes should be due? – Ben Lovejoy, 9to5Mac
You see, this is what we’re up against dealing with Millennials. So now it’s a moral issue. Apple has lots of money. The way they arrange their finances is very complex. It’s bad PR to scrap and fight over every dollar. Apple should just pay up. It’d be a great PR move. Apple’s customers — and we of course in the tech media, we would love Apple. Not. Because, of course, giving government money, why, that is the supreme definition of morality, don’t you see? Apple should just figure out what it owes morally and pay that, whatever the real tax bill is.
Isn’t that instructive? Doesn’t that tell us a lot? So, Apple, as a PR move, should not argue this. They should not even dispute it. They should just pay up and maybe even pay a little more than they owe, and get great PR benefits as a result. Does anybody think that’s what would happen?
What do you think would happen, Mr. Snerdley, if Apple followed this advice and issued a press release today by Tim Cook, the CEO, “Hi, I’m Tim Cook, CEO of Apple. We have just been told by the European Union that we have underpaid our taxes by $15 billion. We dispute this, but because we want our customers to think we are moral people, we’re gonna actually give them $20 billion. By the way, our new iPhones come out the next week, and we really hope you snap ’em up.”
What would be the practical result of Apple publicly announcing they’re gonna pay either exactly what they owe with no dispute or adding to it for the — (interruption) Right. Well, that’s true. The next thing to happen would be every tinhorn government dictator and bloated bureaucracy in the world would be lining up demanding that Apple exercise its morality with them. And then what would they say Apple should do? “They should pay it! They should pay what these governments say. That’s the only way to have good PR and buzz. They should do it. They’ve got so much money, more than they need. Look at that cash wad Apple has. They don’t need all of that.”
I guess there’s really nothing new in that kind of thinking about wealth and so forth. What is missing, however, is the acknowledgment or the appreciation for what it took to create that wealth. And this is what, sadly, is often missing. People see the wealth. They don’t have any idea what went into creating it.
Full transcript here.
MacDailyNews Take: The Irish government on Friday should join Apple in the appeal against this obscene EU tax grab.
By policy recommendation, any clawbacks should go directly to pay off Ireland’s debt. Apple’s €13 billion would be a drop in the ocean of roughly €200 billion debt. The idea of pissing off one of your best and growing employers while conceding to be led around by the nose by a feckless Brussels kleptocracy in exchange for a meaningless drop in the ocean isn’t smart, it’s stupid.
Apple is currently Ireland’s 34th largest employer. How much tax revenue (income and health (USC), capital gains, sales, property, vehicle registration, plastic bag, etc., etc., etc.) and economic activity (sales of gas, housing, utilities, investment, food, BEER, etc.) do Apple’s upwards of 6,000 employees and their families generate for Ireland annually?
Irish residents opposed to EU’s tax demand of Apple – September 1, 2016
Apple Inc. pushes back against EU tax grab – September 1, 2016
Apple may repatriate billions of dollars next year after new U.S. President takes office – September 1, 2016
U.S. tax code allows for dramatic retaliation against EU overreach in Apple case – September 1, 2016
Apple CEO Tim Cook on EU tax demand: ‘No one did anything wrong here and Ireland is being picked on… It is total political crap’ – September 1, 2016
U.S. Treasury: The European Commission’s retroactive tax demands on Apple are unfair – August 30, 2016
EU demands Apple pay massive $14.5 billion in taxes plus interest – August 30, 2016
U.S. government warns EU: Do not hit Apple with a massive back tax bill – or else – August 25, 2016