“Technology giant Apple Inc. has in the past few days been the recipient of juvenile attacks from U.S. Senators on both sides of the political aisle. Its alleged misdeed was the legal shielding of overseas earnings from corporate taxation stateside,” John Tamny writes for Forbes.”Funny here is that back in 2001 Sarbanes-Oxley was foolishly passed to ensure that CEOs watch out for shareholders. Twelve years later Apple chief Tim Cook is under attack for doing just that.”
“Congress, ever eager to spend money not its own, is bothered that Apple would have the temerity to not expose all of its earnings to U.S. taxation,” Tamny writes. “Politicians exist to spend, and Apple is apparently not complying despite the billions in taxes it hands to the feds on an annual basis. The hubris of the political class is surely limitless.”
Tamny writes, “After that, the Apple story offers a real-world path to analyzing the effect of Keynesian stimulus programs. It says here that the Apple example reveals with great clarity just how anti-growth is the oxymoron that is ‘government stimulus.’ That’s the case because whether right or left, it would be hard to find anyone so deluded as to say the federal government can allocate capital in ways more stimulative than could Apple.”
“Assuming Cook chose to expose all of Apple’s earnings to U.S. taxation he would not only have been fired, but it’s also the case that the revolutionary creator of iPhones and iPads would have less in the way of funds to access in order to continue to innovate. To Keynesians of the Paul Krugman variety, the above would not be a problem. In their staggeringly obtuse view of the world, how capital is allocated is of no consequence; the important thing being that money is spent with abandon. To the Keynesians who worship at the altar of consumption, the economic ideal is to get the money spent as quickly as possible,” Tamny writes. “Of course ignored by the Keynesian elite is that how capital is allocated is of great importance. In the private sector failed companies and ideas are quickly starved of capital so that they can waste no more of it, after which new and better ideas move to the front of the line for investment. That’s surely not the case when it comes to government outlays with the money of others.”
Tamny writes, “Looked at in the most basic of lights, does anyone think a federal government known for ‘Bridges to Nowhere,’ squirrel robots and loans to the Solyndras of the world is a better steward of capital than is Apple? Does anyone think federal spending is more economically stimulative than Apple’s careful, market disciplined capital allocations? The nature of the question answers it, at which point even the mildly sentient would have to agree that Tim Cook did the U.S. economy a huge favor for protecting Apple’s earnings from prodigal hands of politicians.”
Read more in the full article here.
MacDailyNews Take: One simple thing would fix a boatload of messes in the U.S. (which is why it will likely never happen): Term limits*.
Eliminating career politicians would be like removing a cancer on the country. Think they’ll vote for their own extinction? The horror of them having to get real jobs (and become regular citizens to whom the laws they’ve just passed also apply) is seemingly far too powerful a deterrent. Oh, well, every system has at least one flaw somewhere.
“One thing our founding fathers could not foresee… was a nation governed by professional politicians who have a vested interest in getting reelected. They probably envisioned a fellow serving a couple of hitches and then looking forward to getting back to the farm.” – Ronald Reagan
*Term limits for all branches or term limits for none.
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Apple CEO Cook makes no apology for company’s tax strategy – May 22, 2013
Apple CEO Tim Cook charms Capitol Hill – May 22, 2013
Rush Limbaugh: ‘High-tech lynching: Senate attempts to crucify Apple’ – May 21, 2013
Nobody on U.S. Senate committee laid a glove on Apple CEO Tim Cook – May 21, 2013
Senator Rand Paul: Senate committee ‘should apologize to Apple for bullying one of America’s greatest success stories’ (with video) – May 21, 2013
Ireland: We have no special tax rate deal with Apple – May 21, 2013
Apple prepares for Washington onslaught: CEO Tim Cook isn’t taking any chances with senators looking to grandstand – May 21, 2013
Watch Apple CEO Tim Cook’s live testimony before U.S. Senate, starting at 9:30am EDT – May 21, 2013
U.S. Senate investigation found no evidence that Apple did anything illegal in avoiding taxes – May 20, 2013