“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:
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.]
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