“Only the little people pay taxes” -Leona Helmsley
In my last post, I wrote about the newest scam to screw hardworking people. It involves several Fortune 500 firms that have hired a company called Talx to wrestle workers’ unemployment benefits away from them.
This is how corporations “handle” the messy human contact aspects of running a business. They hire a third party to come in and do the dirty work of dealing with unsanitary stuff: emotions, workers’ livelihoods, mental breakdowns, etc.
For example, Wal-Mart hired Talx to steal the unemployment benefits of Gerald Grenier, a mentally handicapped night janitor because he allegedly stole some coins from a vending machine (Grenier says he forgot to turn in the change).
Corporations also import other jackals to “restructure” and “downsize” their beloved cogs to avoid any unnecessary unpleasantness like a workplace shooting. Everything — anything — can and should be outsourced, downsized, and restructured if it eventually results in expanding profits.
But it appears the corporation’s loyalty extends only to its own bottom line. According to the GAO, the vast majority (66%) of 1.3 million corporations, pay no federal income taxes. A quarter of the 1000 largest U.S. corporations (those with over $250 million in assets or $50 million in sales) fail to pay any taxes.
At a time when Americans are suffering the most, many corporations refuse to give back to the country.
On Monday, unemployment benefits expired for tens of thousands of unemployed Americans. Approximately 212,000 will lose their coverage this week alone. Fifteen million people are unemployed. The unemployment rate in Detroit is over 20 percent (some estimates put unemployment much higher at around 50 percent), while other estimates place the unemployment of black males in Detroit at 70 percent.
Comparatively, check out the behavior of ExxonMobil, a frequent target of vituperative screeds, but deservedly so. In 2009, Exxon paid zero dollars in US income taxes. Zilch. Nada.
They can do this via a process of sheltering their revenues in foreign tax havens (as I briefly mentioned in my last post). Forbes explains the whole dastardly process, including the wondrous Exxon update.
Exxon tries to limit the tax pain with the help of 20 wholly owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands that (legally) shelter the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi. No wonder that of $15 billion in income taxes last year, Exxon paid none of it to Uncle Sam, and has tens of billions in earnings permanently reinvested overseas.
This is a corporation that has hoarded some of the most obscene profits the world has ever seen. Exxon once paid a single idiot $400 million to stop working. The company poisons the environment (while simultaneously advancing global warming denialist myths,) and engages in human rights abuses and illegal trading. At the same time, Exxon successfully bought off both political parties to maintain the level of federal regulatory incompetence to which it’s become accustomed.
When corporations squirrel away profits in foreign havens, it deprives the United States Treasury of anywhere from $10 billion to $20 billion in lost tax revenue each year, according to a Tax Notes study. If Gerald got busted for stealing vending machine coins, surely Exxon should get busted for stealing $10 billion from the US Treasury.
Americans are constantly force fed the narrative of “tightening their belts” and “sharing the sacrifice”, but this is always a one-way road designed for the poor. The really sad part is watching poor people breathlessly defend the helpless Exxon corporation against the bad ol’ Socialists who want to tax them at a fair rate, while screeching — in all seriousness — global warming isn’t real because an “Exxon scientist” says so.
These kinds of corporate pawns will be helping Exxon execs load the money bags into the vans even as the flood waters emerge on the horizon.
After all, we can all be Leona if we just wish hard enough.
Update: Exxon is disputing the claims made in Forbes’s original article. A representative contacted the original author, Chris Helman, Mother Jones, myself, and I’m sure several others, with the following:
It is incorrect to say that ExxonMobil did not pay any U.S. income tax in 2009, In fact, we expect a significant U.S. federal income tax liability for 2009, although our tax return will not be filed until later this year.
Our tax installments overpaid our 2008 U.S. federal income taxes and we used that excess in part to pay our 2009 estimated taxes. The amount stated in our 10-K filing with the SEC, which Chris told me he based his story on, includes expenses or credits recorded during 2009, and can represent items from previous years or expectations for subsequent years. It is not our actual tax bill.
The bottom line is that it is not correct to say we did not pay any U.S. federal income tax in 2009. We have already paid against our estimated 2009 U.S. federal income taxes and will be filing our return later this year.
Alan Jeffers, Exxon Media Relations Manager
Here is Mojo with more:
Jeffers, however, declined to discuss what ExxonMobil’s actual US income tax liabilities might be—in 2009, or in any year—except to say that it wasn’t zero. “We don’t disclose our tax bill; we’re not required to,” he said. “Just like most corporations and individuals, we disclose what we’re required to.”
Which leaves the figures in ExxonMobil’s 10-K largely unexplained: Even if the firm overpaid taxes and earned a refund, it still wouldn’t show up as a zero or a positive revenue in cashflow—unless the paid tax liabilities are concealed elsewhere in the report. And it doesn’t explain why ExxonMobil’s figures are so out of wack with its peer corporations, like Wal-Mart, cited in the original story above, or Chevron, which listed $200 million in US income tax on the same line in its 10-K, Forbes reported.
In any case, the original story is wrong in this respect: According to the 10-K, a screenshot of which is provided below, ExxonMobil didn’t have a zero-tax liability in 2009; it was actually owed $46 million by the IRS, against $15.1 billion in foreign taxes owed. As Jeffers says, that may not be the case; but it’s what ExxonMobil told the SEC, its shareholders, and the world. And since the firm refuses to share its actual tax numbers with the public, it’s all we have to go by.]