I highly recommend that you spend what's remaining of your free page views reading this New York Times article detailing tax avoidance strategies at General Electric. Here is the key quote:
The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States. Its American tax bill? None. In fact, G.E. claimed a tax benefit of $3.2 billion.
Economist Martin Sullivan provides a nice summary of the actual tax rates that G.E. has faced over the last decade:
Add to this, that we have been hearing over and over again for the last several years that corporations are unable to create jobs because of profit-crushing regulations and uncertainty. Annie Lowrey notes that, in fact, profits are doing just fine:
According to the Bureau of Economic Analysis, real corporate profits neared an all-time high in the last three months of 2010, with companies raking in an annualized $1.68 trillion in pre-tax operating profits. ... The Federal Reserve estimates that companies are sitting on about $1.9 trillion. At the same time, unemployment remains at 8.9 percent, and job growth is still anemic.
And what about jobs? Again, Martin Sullivan in testimony before the U.S. House Committee on Ways and Means notes that U.S. multinational corporations have, in fact, been creating a lot of jobs, just not here.
Is General Electric at least sharing the bounty of its successful and innovative tax avoidance with its remaining U.S. workers? Mike Elk reports the answer is No:
This year, 14 unions representing more than 15,000 workers will negotiate a new master contract with General Electric. Among the major concessions GE has signaled that it will ask of union workers is the elimination of a defined-contribution benefit pension for new employees, a move the company has already implemented for its non-union salaried employees. Likewise, GE is signaling to the union that it will ask for the elimination of current health insurance plans in favor of lower quality health saving accounts, a move the company has already implemented for non-union salaried employees as well. In addition, General Electric may ask some workers for a wage freeze.
So there you have it: corporate tax burdens are falling, profits are nearing record highs, U.S. multinational corporations are not creating many U.S. jobs and they are using high unemployment as a club to extract wage and benefit concessions from their U.S. workers.
The next time you hear a member of the business lobby promise jobs in exchange for doing what they want on economic policy, remember to ask where are those jobs!