Wednesday, May 22, 2013

Apple & Corporate Tax Avoidance

I find it somewhat comical that a Senate committee brought Apple's CEO in to talk about tax avoidance.  It's as if they wanted to make sure Apple found all of the tax loopholes they've made.

Government's job: establishing and enforcing rules for a functioning society

A companies job: make money

In other words, companies are the little pieces in the Monopoly set, government is the rules in the top of the box.

Apple is doing it's job, quite well in fact.  Figuring out how to make as much money as possible, while still following the rules.  And it's fine for the government to set up rules to allow corporations to avoid taxes - it helps companies fulfill their mission.  But, we do have this deficit issue, so they do need to figure out how to even out expenditures & income - Congress should really be asking Apple's CEO about how to do that!

In my opinion the real failing here is not Apple's tax avoidance, or even the tax law (though that should clearly be overhauled and simplified), but how the tax laws come to being.  Let's follow the trail...

Since '98 Apple has spent over $14 million on lobbying and over $2 million on campaign finance.  What were some of their lobbying efforts?  Surprise - bills that allow tax avoidance!  Has it paid off?  Definitely - WSJ reports that Apple has saved over $74 BILLION in taxes doing this Irish jig.  That's a fantastic return on investment.  Is this legal - yep.

So, it looks like Congress will begin talking about reforming tax law - maybe reforming lobbying & campaign finance laws would be a better beginning.

Tuesday, May 21, 2013


I'd been seeing some articles in our local paper about upcoming school board elections, held this morning.  There was a choice of two for our district, who drew pretty clears lines about philosophies ("I'm pro-education" & "I'm anti-tax").

So, after the school bus picked the kids up, I drove to our borough building to cast my vote.  I was greeted by two borough representatives who immediately started talking about the vote, write-in's etc.  I cut them off an asked "Is today just a primary, or is it the final vote?  I'm independent - can I vote today?"

The two men smiled, one of them replying "Today is for the flock only.  People who think for themselves can't enter."

I was somewhat taken aback by the borough representatives saying that, especially while they were assisting with primary elections!  A short discussion ensued on party politics, ending with me telling them "I'll be back when I'm allowed in."

Driving to work afterwards I thought of some of the odd aspects of voting in our country:

  • the ingrained party aspect of elections (that our founding fathers warned us against)
  • the cumbersome and antiquated method of voting (can't we just have an app for it? Electronic transactions are pretty well understood - we'd could have better voter turnout, less expense, no lines, etc.)
  • the ever-growing money influence (I'll write about campaign finance more sometime)
It seems a little broken.  That's a problem for a representative democracy, where voting is a primary characteristic.