Apple, corporate taxes, and The New York Slimes

“Why would a company with billions of dollars in the bank — and no plans for a large investment — decide to borrow billions more? A decade ago, that was a question some short-sellers were asking about Parmalat, the Italian food company that had seemed to be coining money,” Floyd Norris writes for The New York Times. “It turned out that the answer was not a happy one: The cash was not real. The auditors had been fooled. A huge fraud was being perpetrated.”

“Now it is a question that could be asked about Apple,” Norris claims. “Its March 30 balance sheet shows $145 billion in cash and marketable securities. But this week it borrowed $17 billion in the largest corporate bond offering ever.”

MacDailyNews Take: Bernie Madoff has grayish white hair. Madoff is an admitted operator of a Ponzi scheme that is considered to be the largest financial fraud in U.S. history. A huge fraud was being perpetrated, but why didn’t anybody notice for so long?

Now that’s a question that could be asked about Floyd Norris. After all, Norris has even whiter hair than Madoff.

Gee, Floyd, this baseless impugning stuff is FUN!

“The answer for Apple is a more comforting one for investors, if not for those of us who pay taxes,” Norris writes. “The cash is real.”

MacDailyNews Take: Fifth paragraph down, after the baseless impugning has been established, you transparent hack.

Norris writes, “But Apple has been a pioneer in tactics to avoid paying taxes to Uncle Sam.”

MacDailyNews Take: Good. Uncle Sam is a wasteful, bloated, ineffectual behemoth. It makes Microsoft R&D look cost-effective. Apple can do far better things, waaay more efficiently with their hard-earned money (as could most citizens).

Tax avoidance is not tax evasion. Tax avoidance, which Apple practices well, is perfectly legal.

Norris writes, “To distribute the cash to its owners would force it to pay taxes. So it borrows instead to buy back shares and increase its stock dividend… Could this become the incident that brings on public outrage over our inequitable corporate tax system?”

MacDailyNews Take: Even better would be if this becomes the incident that brings on public outrage over yet another The New York Times‘ anti-Apple smear campaign as perpetrated by yet another incompetent hack.

Norris writes, “Anger at such tax avoidance — we’re talking about presumably legal tax strategies, by the way — has been boiling in Europe, particularly in Britain… Starbucks could get away with paying no taxes in Britain, and Apple can get away with paying little in the United States…”

MacDailyNews Take: Apple paid $6 billion in U.S. federal income taxes, 1/40th of all corporate income taxes collected by U.S. government in 2012 – Charles Duhigg and David Kocieniewski, The New York Times, January 5, 2013

Next time, read your own rag, if you can read, you ineffectual halfwit.

BTW: As of last March, there were 514,000 U.S. jobs created thanks to Apple Inc. Presumably, these employees pay taxes – local, state, federal, sales, property, school, payroll, gasoline… shall we continue?

Guess what else? The United States is the only country in the world that taxes its nonresident citizens on worldwide income, in the same manner and rates as residents.

Norris continues, “There is something ridiculous about a tax system that encourages an American company to invest abroad rather than in the United States. But that is what we have.”

MacDailyNews Take: Well, lookie here, ol’ Floyd finally got something right!

“‘The fundamental problem we have in trying to tax corporations is that corporations are global,’ says Eric Toder, co-director of the Tax Policy Center in Washington. ‘It is very, very hard for national entities to tax entities that are global, particularly when it is hard to know where their income originates,'” Norris writes. “President Obama… has suggested immediate taxation of foreign profits earned in tax havens, defined as countries with very low tax rates. Some international companies hate that idea, of course. They warn that we would risk making American multinational corporations uncompetitive with other multinationals, and perhaps encourage some of them to change nationality.”

MacDailyNews Take: Define “very low tax rate.” Be careful now.

Norris writes, “Back in the 1980s, the American corporate tax rate of 34 percent was among the lowest in the world. Now the 35 percent United States tax rate on corporate income is among the highest. In this country, notwithstanding the high rate, the corporate income tax now brings in about 18 percent of all income tax revenue, with individuals paying the rest. That is half the share corporations paid when Dwight Eisenhower was president.”

MacDailyNews Take: Dwight Eisenhower was president from 1953 until 1961. The U.S. is a very different place in a very different world today.

Norris writes, “There seems to be something of a consensus developing around the idea that the United States rate should be lowered. Both President Obama and Representative Dave Camp, the chairman of the House Ways and Means Committee, say they want to do that without reducing government revenue, but they disagree on most details. Mr. Camp likes the territorial idea, but he concedes that we would have to do something about the ease with which companies move income from country to country.”

MacDailyNews Take: In other words, plenty of bloviating with no solution whatsoever.

Norris writes, “In Europe, where budget problems have grown drastically, there seems to be a growing understanding that governments must raise a certain amount of revenue and a belief that if one sector manages to avoid paying taxes, that means other sectors must pay more.”

MacDailyNews Take: Yes, governments must raise a “certain amount of revenue,” but how much and at what cost? Perhaps the amount of revenue government wishes to raise is excessive? Perhaps the size of government is actually the root cause of these drastically growing budget problems, not lack of taxes on anything and everything under the sun? We know, ’tis shocking in this day and age to actually suggest that the growth of government in the U.S., western Europe, and elsewhere might actually be something of a problem, but there you have it. Simple logic compels us to at least consider the oh-so-remote possibility, something vapid Mr. Norris never does.

Norris writes, “That led to the anti-Starbucks demonstrations in Britain. In this country, there is little sign of similar attitudes, let alone a belief that those who find ways to twist the laws to avoid paying taxes are being unpatriotic.”

MacDailyNews Take: “The real goal should be reduced government spending, rather than balanced budgets achieved by ever rising tax rates to cover ever rising spending.” – Thomas Sowell

Norris writes, “If that belief [that those who find ways to twist the laws to avoid paying taxes are being unpatriotic] were to become widespread, Apple and similar companies might find that their success in avoiding taxes was making them unpopular with other taxpayers — people whom Apple wants to be its customers.”

MacDailyNews Take: If you want to try ginning up the idea that that those who lawfully practice tax avoidance strategies are being unpatriotic, NYT, or finagle another now-meaningless Pulitzer, you need to hire a better yellow journalist than Floyd The Utterly Transparent to push your biased agenda.

It worked back when you were firmly in control, dummies, but now this sort of crap just makes you look manipulative, disingenuous, petty, and ham-handed. No wonder you long for the Eisenhower days.

Full article, Think Before You Click™, here.

MacDailyNews Take: One more time for good measure:

Apple, a single company among millions, paid 1/40th of all corporate income taxes collected by U.S. government in 2012.

As we said this morning, it’s not surprising that The New York Times‘ earnings are down 93% year over year.

On the bright side, they’ll be paying much less in taxes.

[Thanks to MacDailyNews Readers “Fred Mertz” and “Arline M.” for the heads up.]

Related articles:
The New York Times tries to blame Apple for smartphone thefts – May 2, 2013
The New York Times cashes in on its naked ploy to ride Apple Inc. all the way to a Pulitzer Prize – April 15, 2013
Can the New York Times cash in on its naked ploy to ride Apple Inc. all the way to a Pulitzer Prize? – December 28, 2012
The New York Times blows it again: Incorrectly reports Apple’s tax rate – April 30, 2012
Rush Limbaugh: New York Times targeting Apple; latest hit piece based on erroneous tax data – April 30, 2012
Apple to The New York Times: We are among the top payers of U.S. income tax – April 29, 2012
The New York Times: How Apple sidesteps billions in global taxes – April 28, 2012
The New York Times blows it, gets Apple CEO Tim Cook’s earnings spectacularly wrong – April 9, 2012
Why did The New York Times revise their ‘iPad modest changes’ article and neglect to inform their readers? – March 8, 2012
The New York Times continues idiotic vendetta, claims Apple’s new iPad only offers ‘modest changes’ – March 7, 2012
New York Times gets cold shoulder from Apple after negative reports – February 17, 2012
Rush Limbaugh: The New York Times has turned on Apple; they wouldn’t do this if Steve Jobs was alive – February 1, 2012
BSR: New York Times’ Apple-Foxconn article contains untruths, inaccuracies, and misleading info – January 29, 2012
Apple CEO Tim Cook calls New York Times supplier report ‘patently false and offensive’ – January 27, 2012

74 Comments

    1. Damn straight !

      The New York Times is pure scum. Their readers are deserting them by the thousands and they have no integrty or credibility whatsoever especially because of their ongoing, shameless, biased fabricated and downright dishonest smear efforts of Apple.

      The problem is that they actually get away with it. Well, karma catches up with everyone and every dog has it’s day.

      Tick tock tick tock

      1. They are staring at the same oblivion that claimed their fellow journals. The scourge will not pause to admire their plumage. To survive they must change their stripes, and we see the sorry result.

    2. Yes! It is good to feel strongly about this issue even though this is not the real issue.
      The real issue is that the particular group that owns the NYT has been found to be guilty of hacking into victims answer phones, people of a certain character i.e politicians, film/pop stars and even ordinary people who have by accident found themselves in a media storm.
      As if that was not enough, the same media group has been found to be guilty of bribing or paying off police chiefs to access information over ongoing investigations, threatening politicians careers and influencing government decisions particularly in general election years and trying to achieve monopolies particularly in TV.
      Tight regulation has been proposed in the UK, their reaction? Freedom of the press is being threatened because parliament would oversee compensation and restitution to those injured, their response? They want to carry on self regulating by making sure that one of their own sits on the panel of judges and if any decision is made, it is only valid and enforced if they unanimously agree to it!!!
      So deflect the rest of the world from what is going on in the UK lest they see the light and impose similar regulations.
      Let us not forget that the stock market, financial analysts, economists and so called sooth sayers of the money markets need the media in order to disseminate their disinformation so that the unenlightened masses can buy into their scams!
      This is what the above article is about! We should not be blinded or allow ourselves to be sidetracked in this way.

      Just A Thought! (quoting Mr. Norm)

      1. From what you’re saying, it seems that you’re talkling about the News Corp (the Murdock empire), which owns the Wall Street Journal, and NOT the New York Times.

    3. I wonder when Apple will realize that the left is their enemy. To the left, Apple is all things evil. They are a corporation. Worse, they are an unimaginably successful corporation and doing so just by following the rules of capitalism. Even worse, they create wealth for people who work with them, invest in them, and work for them. It’s no wonder the New York Times hates them and choses to pick on them at every opportunity.

      Meanwhile people firmly on the right cheer the company on. Hell Rush Limbaugh gives them more free advertising than The Constitution, and its not about politics. Limbaugh just likes their products.

      While the right is championing the company, Apple is attacked on every side by the scum of the left. The Government, half baked environmentalists, political identity groups, human rights groups, all for things that are neither their fault nor unique to Apple. The LWNJs just go after Apple.

      You’d think Apple would wake up and smell the coffee.

      You’d think Apple would at least realize that the New York Times seeks to promote themselves at the expense of Apple’s reputation. How much of this crap will they take?

      “Once is an accident. Twice is coincidence. Three times is an enemy action.”

      1. The problem is, TMac, that you classify a lot of people as LWNJs. There certainly are some extremist people and groups who might fit that label and deserve your derision. But there are also some RWNJs. Given the chance, I believe that most people would be willing to find some common middle ground. But that won’t happen as long as people keep applying simplistic labels to complex ideas rather than taking the time to research, debate, and understand the details.

        The fact that you classify this situation in militaristic terms and label a large group of people as Apple’s “enemy” is disturbing to me. You just took one step farther towards the RWNJ extreme.

  1. The NYT is a liberal rag.

    “In liberal logic, if life is unfair then the answer is to turn more tax money over to politicians, to spend in ways that will increase their chances of getting reelected.” – Thomas Sowell

    1. The world certainly has changed.

      Dems/Libs/Progs used to question authority. Nowadays they’ll do anything to finance it, no questions asked.

    2. A bunch of friggin’ whiners. You wax poetic about patriotism and the Constitution with one face, and call taxation ‘theft’ with the other face.

      I agree that the u.s. Gov’t should spend less. But it really irritates me when you act like everything would be perfect if the U.S. just bent over and let you ram your illogic up ur bungholes. Neither political party – repeat, *neither* party has been willing to make the hard decisions over the past five decades or more that we’re and are necessary to maintain solvency in the long term. The only thing worse than tax and spend is tax cut and spend. Tax cuts are just enablers to a society addicted to debt-financed services. Tax cuts are the buzz with a delayed hangover, particularly when the tax cuts are packaged with promises of growth-induced wealth in the future. Look! Free revenue!

      Raise the damn tax rates and make people feel the pain of actually trying to pay for the services that they consume. People used to know what it meant to sacrifice for this country. Now we import cheap foreign labor to do the hard jobs while hypocritically complaining about illegal aliens or ‘undocumented workers.’ That is the best way to gain enough support to force politicians to do what is necessary, or replace them with people that will.

      And now MDN is contributing to the political crap on this forum, strutting around on their bully pulpit. In my opinion, avoiding taxes is logical, especially for a corporation that is supposed to maximize value for its shareholders. It is not despicable. But neither is it a virtue. It is just business. If you don’t like it, then change the law. But every country is looking for an edge, and the multinational corporations are just playing them off of each other to get the best deal. That is the way it works.

      1. Just curious—how do you successfully deal with the conundrums of this species? I ask only because of my own difficulties in communicating basic ideas without exciting a sometimes rabid response. Is the disease somehow related to anonymity, due to insufficient kinship indentity mechanisms present in the Internet? Or is it due to an incorrigible, inbred hostility to all life forms? Or is it something in between these extremes?

        Your advice would be invaluable, as I prepare my preliminary report to Central Galactic Intelligence on self-destructive apex species in the Milky Way. I’ll forward a copy to you.

        1. The political polarization of American society began long before the internet became ubiquitous. However, it is reasonable to believe that the availability of a worldwide network of computers and mobile devices is being used as a powerful tool to manipulate public opinion and generate wide-scale reactions providing power and/or wealth to a few. Social media is also being used for sophisticated social engineering activities. And ‘news,’ with its increasing emphasis on first-to-publish over accuracy, opinion over fact, and rebroadcasting over self-generated content, is generally less dependable than in the past. Entire networks have been created or modified to service and manipulate specific demographics. Again, the primary objective is generally the concentration of power and/or wealth. If a particular demographic becomes marginalized, then the associated media will transform in an attempt to recapture mindshare.

          With respect to dealing with the ‘conundrums of the species,’ I cannot provide any guidance. Many people have solidified their opinions on various subjects (often based on erroneous data), making any attempt to enter into a serious debate a complete waste of time. You have to pick and choose your opportunities.

          With respect to your question about an “incorrigible, inbred hostility to all life forms,’ I believe that is a vast overstatement. For instance, many people like kittens or puppies. Other than sadly maligned and misunderstood species such as snakes, the hostility of which you speak is generally targeted towards other humans – those who do not share a belief system that is consistent in most or nearly all respects. Hostility can be present even when two people or groups share a belief system that differs only in one or a few key areas. This does not bode well for the future of the human race.

          I hope that this is helpful for your report to the CGI.

    3. “We contend that for a nation to tax itself into prosperity is like a man standing in a bucket and trying to lift himself up by the handle.”
      –Winston Churchill

    4. “In corporatist logic (in other words, both Democrats AND Republicans), if politicians want to increase their chances of getting reelected, then the answer is to turn more of ALL money over to the corporations and their rich owners.”
      — People who are paying attention and not blinded by whichever “side” they were supposed to pick in the big distraction game.

      Geez. The political commentary by both teams in this rigged game is really tiring. Makes me think we are doomed to be ruled by big corporations, which carefully feed money to both of your teams. Then I remember this site hopefully isn’t representative of all people. I keep trying to convince some of you to stop being cheerleaders for one player in the pro-wrestling game that is American politics. Here’s a hint: the game is rigged so the corporations extract money from you, no matter who wins in the “ring.”

  2. Uncle Sam is a wasteful, bloated, ineffectual behemoth.

    While I agree that the government is wasteful and bloated, I WISH that it was ineffectual. Its effects are vast, and horrific.

    -jcr

    1. (sigh) So Uncle Sam can’t do anything right according to you?

      Think about this while you listen to that CD or DVD – Sony & Philips had to license some of the key patents from Uncle Sam’s research in order to produce those CDs & DVDs, because the first working video disk was created in a US Govt R&D Lab.

  3. A tax policy that makes it financially advantageous to keep money OUT of the country is brain-dead. If there were anyone with two neurons to rub together involved, the tax policy would encourage anyone and everyone to bring their money INTO the country.

    -jcr

  4. Funny, MDN, I didn’t read the article quite the way you did. I thought it was relatively measured and reasonable. I don’t agree with all of their conclusions, but they made their point honestly. Your comments were definitely beneath you. If the US really wants to balance their budget, they could do something about the insane “Offence” Budget. They could get rid of corporate influence.

      1. Why in the world would you say that? Isn’t Obama a Democrat? Aren’t both Republicans AND Democrats hopelessly corrupted by corporate influence. If Swing Geezer is against corporate influence, then I certainly hope he isn’t dumb enough to support Obama OR Republicans. Obama’s administration has a two-way revolving door with Goldman Sachs, as did the Bush administration. Obama carefully does what large corporate donors want him to do, as do most other of both major parties.

        So, stop wasting everyone’s time with knee-jerk political sports attitudes, Julia – you’re just feeding into the plutocracy taking away our freedoms and our resources.

  5. Let’s have zero tax, let government collaps. Past national citizens can become members of corporations, but be fired at any time. Corporate leaders get anything they want, bread, kill anyone they want, start wars, burn oil and coal until the sky’s turn black, kill all animals. Companies should be able to feed their employees poison, just enough to work, bread more employees until useless, then they die when they can’t work anymore.

    We should forget about cancer and disease. Unless there is a profit motive.

    We will all be happy.

    Remember it’s about sustainability, to keep rich people rich, and everyone else can go to hell.

      1. #Sarcasm has many forms.

        My point, there is a happy medium.

        I am sick in the fact that our government doesn’t represent the people. Dirty money is everywhere and we can’t get anything done.

        #citizensunited

          1. Sorry, but “right” is subject to law, custom, and popular favour. I wish it were otherwise. Relativity seems more the rule than absolutism these days.

  6. There should be a separation between business and state. The state collects taxes, as much as it needs to protect its borders and people, rase and educate the next generation, and nothing else.

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