Ballmer Threatens To Pull Out of the US 1142
theodp writes "Microsoft CEO Steve Ballmer is threatening to move Microsoft employees offshore if Congress enacts President Obama's plans to curb tax avoidance by US corporations. 'It makes US jobs more expensive,' complained billionaire Ballmer. 'We're better off taking lots of people and moving them out of the US as opposed to keeping them inside the US.' According to 2006 reports, Microsoft transferred $16 billion in assets to secretive Dublin subsidiaries to shave billions off its US tax bill. 'Corporate tax is part of the overall advantage of doing business in Ireland,' acknowledged Ballmer in 2005. 'It would be disingenuous to say otherwise.'"
Sure, move out. (Score:4, Insightful)
EU is much more user oriented then US.
WTF?!? (Score:2, Insightful)
He admits they transferred resources to Ireland to avoid taxes and then whines that if they go after that, he'll leave...WTF?!?!?
All I can say is 'so long Monkey Boy'
Re:Sure, move out. (Score:5, Insightful)
Exactly what I was going to say. Move your main operation to Ireland and the EU has much much more control over windows. Microsoft is having huge problems with the EU because, well they are actually interested in the public good.
But corporations don't pay tax (Score:1, Insightful)
Corporations don't pay tax. Not really. They pass on that tax to their customers. Ultimately, it is the consumer that pays the tax.
Then boycott MS (Score:2, Insightful)
If anything had us doubting they maintain their position with criminal means, this should remove the uncertainty.
Not very bright... (Score:5, Insightful)
First off, it just isn't a very good idea to start going tit-for-tat with the US government. That's especially true for a convicted monopolist, not to mention the fact that the previous administration essentially cancelled anything so severe as even a wrist-slap.
That judgement could be re-examined.
Second, that's just a really patriotic, really American thing to do. Or does it mean that patriotism is defined one way for corporations and their heads, and another way for "merely working Americans"? For one of the most profitable corporations in US history to in all essence say, "I don't want to pay my fair share, I'm taking the rest of the American jobs overseas," is a real slap in the face. It's also not as if this is meant to be a tax increase, it's meant to be eliminating a tax shelter. For you and me, using such a tax shelter would be cheating, avoiding doing our fair share.
Third, I'm sure "Vista for the US Army" isn't a done deal. Also don't forget, Linus Torvalds is a US resident, and I'm sure *he* pays his income taxes, as do the various US-residing RedHat, Novell, etc, employees.
Move Microsoft Employees Offshore? (Score:3, Insightful)
That sounds great. I suggest moving them about 100 miles offshore, and then dropping them. It should make a satisfying splash sound. Then comes the thrashing, and the drowning, and the bubbles.
On a more serious note, just how many employees do they think are going to pick up and leave Washington for Ireland? Was this their plan all along? I guess the climates are compatible...
No Surprise (Score:3, Insightful)
Greed.....just as old as prostitution, war and slavery.
Personally, I'm surprised MS hasn't moved out already. Not to mention plenty of other greedy corporations like the one that I work for. More and more, I'm beginning to think that it's time to get out of IT. The "bottom line" is all these fuckers truly care about. All I know is that karma will eventually catch up to them.
Re:Sure, move out. (Score:5, Insightful)
And Dublin, what an excellent idea... just because they used to have good tax breaks for large relocating corporations doesn't mean that will continue. Not when the IMF steps in and tells them how to run their economy after their debts destroy it; even Dell has pulled out of Ireland and is moving from Limerick to Poland.
Perhaps if MS was under the jurisdiction of the EU, they'll do what the DoJ should have done and will break it up into several MiniSofts.
Re:Then boycott MS (Score:4, Insightful)
Moving operations to the lowest cost location is not illegal. Also, it is inevitable. Even if MS doesn't do it, someone will form a software company offshore that costs less to operate. Over the long term, this new company will take business from MS, making the end result the exact same.
Try as you and Lou Dobbs might, you can't stop the free market. Wealth and employment will eventually move to the most business friendly locations.
On pulling out (Score:5, Insightful)
Microsoft: exploits loopholes in law to avoid paying corporate taxes.
People: exploit loopholes in Windows activation to avoid paying for a license.
Re:Sure, move out. (Score:4, Insightful)
One better. If MSFT pulls out of the USA they lose the influence they have with US patent law isn't the same as the EU, and the EU will kick MSFT to the curb several times over.
While they retain those patents in the USA, they are worthless in the EU.
So I say go MSFT and let the door hit you on the way out.
Pure FUD. (Score:5, Insightful)
The sad thing is that this is all Microsoft has become. Microsoft won't leave the US. For one thing there's a lot more to running a business than a freaking tax shelter. This is just another instance of Balmer blowing smoke. It's really a large portion of how he tries to exert influence.
I think Balmer is going to soon learn this is simply NOT the time to start drawing lines in the sand between greedy corporations and everyone else. Public opinion of Microsoft DOES matter, and painting your corporation as a bunch of dickweeds that'll just up and leave over some legislation is just idiotic.
Re:But corporations don't pay tax (Score:5, Insightful)
Bite the hand that feeds... (Score:1, Insightful)
The U.S. is becoming increasingly hostile toward business. I certainly wouldn't blame Microsoft, Google, Intel or any big company for leaving the U.S. if they can find a country that does not view them as a cash cow, does not attack them with anti-trust, and does not punish their energy-use with cap and trade.
A smart country could displace the U.S. as the economic leader in the world by recognizing and protecting the liberties required for individuals and companies to survive and prosper. If there were a country with minimal tax, strong protection from the government, freedom to think and act - I know I would move there.
In makes you wonder (Score:2, Insightful)
Re:Not very bright... (Score:2, Insightful)
Since when is going along with excessive taxation being patriotic? This country was founded on the principals of capitalism and *limited* government. Adhering to those principles seems more patriotic than foolishly helping our government get larger and more out of control.
Re:I'm okay with this (Score:2, Insightful)
Yeah, and then it goes right back out to the government to make up for the lost taxes from MS. Good thinking, son.
Please please please please please! (Score:4, Insightful)
Steve, please do it. And better still, please keep telling everyone you're going to do it. You know what, how about starting a blog and telling everyone exactly how you think the American public and the world at large should make life better for the M$ shareholders.
Please, we want to know.
Re:Sure, move out. (Score:5, Insightful)
If they go out of US, to who M$ will complain to prevent unlicensed use of Windows?
It's SO unfair that people pirate our products! We made those products and we deserve our cut damn it!
It's SO unfair that we have to like obey our nations tax laws!
Yeah lets go after those that break the laws we like and lets use all our lawyers and accountants to avoid the laws we don't like.
Re:But corporations don't pay tax (Score:5, Insightful)
Not true.
Companies are constrained from passing on the full value of their tax to their customers by the price elasticity of demand for their product. Which in turn depends on the how much their customers need their product (can they put off buying them or do without, do they yearn for it?) and the availability of substitute products and the degree to which those substitute products are suitable (Linux and Mac OS X are pretty good, as is OpenOffice).
If he could pass on the full cost to his customers Ballmer wouldn't care about a tax increase.
Re:But corporations don't pay tax (Score:5, Insightful)
Right; most taxes are based on transfers of capital. There's no fundamental difference between a tax on a corporation / income tax or sales tax. The money has moved from control of one (legal) person to another. Also the grandparent is assuming that companies charge for their products according to their costs which is garbage. They charge according to what they can charge. If MS starts paying fair taxes and increases product costs to cover it, that would give linux distribution builders who have to pay full income tax a more fair chance in the market.
Re:Then boycott MS (Score:2, Insightful)
Ya know, just because some corporation skips out of town to save a buck doesn't mean it's a good thing or even the proper thing to do. It just means that they're making more money at the expense of the country that allowed them to get so big in the first place. Capitalism has flaws and that is one of them. I don't really understand your sentiment. Looks good on paper, smells like crap in practice. People should trust their noses.
Re:And as a reward... (Score:5, Insightful)
While I agree with the rest of this statement, the crap like "it is a requirement of a corporation to maximize the shareholders...." blah blah blah need to be RETIRED. Repeating this corporate dogma garbage just strengthens the hand of blowhards like Ballmer.
It is NOT HAPPENING in the U.S... it's all about doing what's best for the corporate elite at the very top. Even if you accept the "corporations work for the betterment of the shareholders" argument for a second you then need to take into account that the biggest shareholders by far are the Board members and CEOs at the top anyway and they are STILL just working in their own best interest.
Re:But corporations don't pay tax (Score:3, Insightful)
Companies don't pay for routers. Not really. They just pass those costs to their customers. Ultimately, it is the consumer that pays for routers.
Statements like this are true, but irrelevant.
Good luck! It's an idle threat by a hothead (Score:4, Insightful)
To begin with, none of the executive team wants to live in any of those countries with super low labor availability. Sure, Western Europe, the UK -- you'll get lots of takers among management and plenty of good managers over there already. Try moving all those lifestyle employees living in the Seattle suburbs to India, Pakistan, Indonesia, or China, and you'll see a very different result.
So, now we're talking about really threatening to move the teams of "developers, developers, developers, developers" off shore. Companies that have tried this before have found that much to their shock, "developers, developers, developers, developers" are not bought and sold as commodities by the pound, but in fact are individuals who have creative ways to solve problems and work best when they can interact with the decision makers to improve the product.
The truth is, only the lowest tier of developer "meat" can be moved easily off-shore and away from the management and executive teams where decisions and management happen. If you ignore that, you get crappy product. You get crappy product because the offshore teams give you EXACTLY what you ask them for, instead of working with you to understand the goal and produce a result that makes more sense.
In summation: "FSCK-OFF" Balmer.
US == Software Patents (Score:5, Insightful)
Seeing that the US is one of the few countries that have Software Patents, Ballmer might want to reconsider. Currently the EU does not have Software Patents, and hopefully never will. Seeing that Microsoft's strategy lately is to patent everything and spread FUD about Linux infringing on it's patent portfolio, threating to move the company outside of the US would mean there would be less of an incentive for the US to maintain it's position on Software Patents.
Re:Capitalist flight (Score:4, Insightful)
While making it VERY difficult on companies to hide tax money offshore, at the same time, why don't we cut corportate taxes severely. That way, you attract more businesses back to the US, and there is less reason to try to 'hide' the monies.
Besides, IMHO...corporate tax is useless, it is just a hidden tax on the consumer, since a corporation just passes this off onto the consumer as part of their cost of a product.
Re:Evil, evil Microsoft... (Score:4, Insightful)
If you have held MSFT over the last 10 years you would have been better off with your money in a savings account.
June 11, 1999 @ $39 to
June 4, 2009 @ $22.14
Other than a little bump in early 2000 at the end of the tech bubble, there is not a year in the last 10 where you would have been better off holding your MSFT rather than selling.
Maybe they (and most corporations) should spend less time trying to game the tax system or the H1A system or screwing around with politics and spend a little more time trying to make a decent product. That is the ONLY thing that can increase shareholder value in the long term. And those greedy, greedy shareholders should demand it...
Re:Ballmer threatens to pull out? (Score:1, Insightful)
Comment removed (Score:3, Insightful)
Re:Get rid of our horrible tax system (Score:2, Insightful)
Re:Capitalist flight (Score:4, Insightful)
Sveral comments:
- Ballmer sounds like an unpatriotic ass. Perhaps /I'm wrong and he's a really nice guy, but not in this article. He's turning his back on the country that gave Ballmer opportunity to be where he is today. Industrialist Carnegie came from Scotland and loved the U.S., and maintained loyalty until his death. He would have never entertained the idea of moving factories to China for cheap labor.
- Raising corporat taxes doesn't affect the consumer as badly as you believe. Yes some prices get raised, but increased taxation also leads to more cuts internally like plastic desks instead of mahogany, fewer free trips to Vegas, snd so on.
- If California's standard of living drops, then wages will drop, and eventually the factories will move back here because WE will be the cheaper labor than the Chinese.
Re:Bite the hand that feeds... (Score:5, Insightful)
The U.S. is becoming increasingly hostile toward business. I certainly wouldn't blame Microsoft, Google, Intel or any big company for leaving the U.S. if they can find a country that does not view them as a cash cow, does not attack them with anti-trust, and does not punish their energy-use with cap and trade.
A smart country could displace the U.S. as the economic leader in the world by recognizing and protecting the liberties required for individuals and companies to survive and prosper. If there were a country with minimal tax, strong protection from the government, freedom to think and act - I know I would move there.
Thank you! Why is it that corporations who want to keep the money they earned by selling products and services are evil and greedy, but the government wanting to take more and more of that money is perfectly fine? What makes government more entitled to that money than the person or entity that earned it? You can hate and bash MS or any company for thinking of offshoring jobs to save money, but what about rethinking our punitive tax policy?
Re:Capitalist flight (Score:4, Insightful)
He has an obligation to the shareholders to not be "patriotic", but instead to maximise the value of the company. He could be sued in to the ground if he didn't.
Re:Capitalist flight (Score:1, Insightful)
Because they have all the money in this country. In case you hadn't noticed, the middle class has been going away since the 70's. Cheap Chinese imports have disguised the fact, but it's still going on.
Re:Capitalist flight (Score:4, Insightful)
If MS feels that the taxes associated with doing business in the US are a hindrance, they have failed to consider that the US government might actually "value" those taxes.
That is to say, if MS becomes a foreign company whose retail products are being imported, expect the US government to set up tariffs on software imports. Expect those tariffs to draw substantially more revenue for the government than the present corporate income tax draws. Consequently, expect the net impact on the MS bottom line to go down, and go down further as the cost advantage they now enjoy over their principal competitor (Apple) evaporates, and as the security-minded DOD switches all of their computers to a US-made operating system such as Snow Leopard or a custom system from Sun, costing them an enormous contract.
I don't see how this would be a good move for Microsoft, but honestly, it would be exemplary of a larger trend: that short sighted "I only want to good parts" thinking is motivating US corporations to move most of their operations abroad to save money by avoiding US laws- such as, minimum wage and human rights standards, environmental standards, and taxation. For a few months or years, the profits of these companies SKYROCKET as their costs evaporate, but, keeping retail prices constant, they continue to sustain revenues. Until, that is, enough companies follow suit. When the US marketplace collapses due to the decimation of its labor (and thus, spending) base, there will be nobody left to sell products to- and the government begins to bleed out, as expenditures escalate on human services to mitigate unemployment, while revenues tank due to dropping taxes on all fronts.
In this move, Ballmer has stated his values. Specifically, he does not feel adequately patriotic to even want to pay his taxes, and he cares more for his stock value than for the value of the economy his products "serve".
If Microsoft leaves, let them. I will contentedly go on not buying their products, and smugly advise anyone (in the US) who cares about their country to buy an Apple product instead, which is at least designed in (and pays taxes to) America, or for that matter a product from an originally European or Asian company which at least has chosen to support its homeland.
By the way, if they were talking about "Moving to India so that we can save money on labor and taxes while simultaneously bettering the lives of our future employees there", which they are not, I would ironically be less opposed. But this is just about shouting a big "screw you" to the country that bred them.
Re:And I'm threatening.. (Score:5, Insightful)
Re:Capitalist flight (Score:5, Insightful)
"Besides, IMHO...corporate tax is useless, it is just a hidden tax on the consumer, since a corporation just passes this off onto the consumer as part
of their cost of a product."
Why does this ridiculous soundbite keep getting regurgitated *every single time* this topic comes up?
If corporations don't pay tax as so many Internet corporate lick-spittles shriek, then they wouldn't need ridiculously twisted foreign tax accounts and be prancing around like sooks when someone comes along and tells them to meet their obligations in their home countries would they? They would just happily pass this tax burden it along.
That's right logic doesn't come into a discussion where fanatical ideologists are hopping up and down does it?
Second the same argument could be made for *anyone* who runs a business. "Small business owners don't pay personal income or sales tax, they just pass it along in the price of the goods & services their business sells, so they shouldn't be taxed".
The whole "argument" completely ignores competition, elasticity and old fashioned out of date sneered at "patriotism".
Good god.
The worst thing about it all, is you all point to Ireland as some sort of bastion of economic freedom and some sort of idol, completely ignoring the fact that Ireland has been hit harder than *any* other country since the depression due to it's low tax rates and lax corporate regulations and now has a debt of 800% of GDP and all the multinationals that used and abused her are now running back to their safe secure and regulated home countries post haste!
But yeah, the US should definitely aspire to be more like Ireland or Poland or fucking "Mumbai" as some tool below puts it. What a great idea.
"Light travels faster than sound. This is why some people appear bright until you hear them speak........."
I'll say...
Re:Capitalist flight (Score:5, Insightful)
Re:Capitalist flight (Score:3, Insightful)
Microsoft are everywhere, but you are right, Redmond, Washington, at least last time I checked.
And the important thing here is to try to ignore the people that comes with such threats because they are short-lived and it costs a lot of money to move an operation.
Another issue is that to find a place with a low tax pressure he will have to look into some really strange places - where people not really want to live anyway. Almost every country have taxes, they are just applied in different ways.
So I would just check in on Ballmer and say STFU.
Re:Sure, move out. (Score:3, Insightful)
If you are in the EU, it would be very unlikely for a man to jump out at you with a weapon (unless you were watching England playing soccer).
Most violent crimes are in the family (and you don't want a gun in the house if your teenage son decides to go postal), or caused by poor people. Poor people can't afford guns (especially illegally imported ones), but they can steal them from glove-boxes and suburban houses.
Guess which place is safer?
OK, the US has a lot of street gangs dealing drugs (which is why Canada has guns, but less crime). The gangs only form because they are scary, and they are scary because they have guns. Canada doesn't have street gangs because it is too damn cold to stand in a street corner selling crack, but generally speaking, guns create street gangs, who cause violent crimes.
Seriously, car analogies are better. Nobody goes on off topic rants if you use a car analogy, unless you mention hummers.
Back on topic, how exactly does Ballmer plan on moving Microsoft's employees? Moving a large IT business has got to be in the play book of "stupid things that will bankrupt your company". Most of the staff will go to Google, the rest will go to Apple. I'm sure that Ireland has a few good software engineers, but not as many as Microsoft, and they won't be familiar with the code base.
Re:Capitalist flight (Score:4, Insightful)
And, perhaps more serious, if those companies were to be protected and forced to do things by government production would become increasingly inefficient, since the incentive for efficiency would have been taken away. Inefficiency means that less money is available for the state/country/world as a whole.
The problem with that is what it leads to. Keeping a human alive is not free. Less efficiency means less money available as a whole, and as every developing country illustrates, politicians still steal enough money for 5 mercedesses and a private jet (you see sacrifices and policies only apply to others, don't they Nancy "less co2 ! everyone save ! where's my jet ?" Pelosi ?)
The end result of not letting companies move, not allowing for free trade, and "protecting" those poor (but eating) unemployed, is a whole lot more people starving to death.
Re:But corporations don't pay tax (Score:5, Insightful)
The reasons are sad, but ultimately, my experience working with all manners of the mythical "poor people in America" (they actually do exist) shows them.
First, you can't just expect people to go from "physical workforce" to "idea producers" because you tell them to. Unfortunately, not everyone is creative. Not everyone is intelligent. Similarly, not everyone is strong or has manual dexterity. Some people are very well suited to chopping down trees, digging holes, and assembling circuit boards. Other people are very well suited to inventing things, drafting documents, making things pretty, and directing/managing. Some people are good at both categories, and choose the one that they prefer, in places where they have the choice. But it is not true that MOST people are well suited to idea work. Many, but not most.
Second, you can't assume that Americans naturally make for better "idea producers" than Chinese etc- if you try to set up America as a country of designers and managers, while having other portions of the world simply be the labor force, you (ie, corporate America) are attempting to set up a global caste system. Very dangerous. Yet, even then, there would remain jobs which must be performed physically and locally. Janitor. Pavement repairer. McDonalds cook. Chef. Doctor. If you set up an economy where "most people" are "supposed to be" concept workers, then you are conveying the social message that other work is inferior, and thus, other workers are inferior. Not a good message for a government, of all groups, to promulgate.
Additionally, consider that, even if they are capable of it, many people would despise office-type work. Myself, I am bound to it by ability (err, by lack of physical ability otherwise) but, especially working with the physically disabled, I meet people all the time who would rather starve to death than work in an office- they would rather build things or chop down trees. Many people feel that they haven't worked if their muscles don't feel it at the end of the day, and in fact, my father, being one of those people, actually looked down on people who worked with paper and computers.
Re:Sure, move out. (Score:3, Insightful)
I'm in the US and a man suddenly jumps-out and demands all my money, or he'll shoot me. Am I allowed to carry a bomb belt set to detonate if my heart stops and kill the murderer?
If the answer is "no" then you are not truly free. Ownership of your own body is the first right. Self-defense of that body is the second. To be secure in your papers, home, and car from random unwarranted searches is the third.
Re:Sure, move out. (Score:2, Insightful)
Do we really want to compare US crime rates to EU's?
Re:Like Delaware (Score:3, Insightful)
Cost of doing business is only really one third of it. The other two thirds is what you get for the cost and regulatory constraints.
Which is why China still lags the US in terms of manufacturing out put. Sure they charge less to do business, but the regulations are a mess and the quality tends to be shit. On top of that the costs are going to go way up when the Chinese government allows employees to keep more of their wages.
Re:Then boycott MS (Score:3, Insightful)
When I googled ' "corporate tax rates", usa, graph ' I, too, got the Wikipedia that makes it look like the USA has very high corporate tax rates:
http://en.wikipedia.org/wiki/Tax_rates_around_the_world [wikipedia.org]
But I also got this link, a discussion of statutory tax rates, vs effective tax rates (after all the deductions and other tax reliefs had been subtracted): http://seekingalpha.com/article/92485-statutory-vs-effective-tax-rates [seekingalpha.com] ...which concludes that "the US is a corporate tax haven". That may be going a little overboard the other way, because what I found telling was this comparison of how much of the total tax income of various countries came from corporate tax (the rest from personal incomes taxes, basically):
http://www.oecdobserver.org/news/fullstory.php/aid/2229/Corporate_tax_warning.html [oecdobserver.org] ...which shows the US to be about median for developed countries. (Looks like Germany is the real tax haven.)
By the way, terrific comedy about how if Microsoft won't move, somebody else will start up a company with maybe over 10 percent monetary advantage due to lower taxes elsewhere, and thereby out-compete MS from the market. "...you can't stop the free market". Dude, the entire anti-trust action was about how Microsoft is no longer subject to the free market. Hell, you can produce superior products and give them away for FREE and not out-compete Microsoft. So some little tax break isn't going to make a tiny bit of difference to their market share.
Microsoft probably wouldn't be where it is today if it had started in another country. They got access to a large, young, very educated workforce and were able to sell to the world's largest government and corporations as a local, patriotic choice. Try, just try, selling the US military in particular, any foreign-based product. Alas, it takes a lot of tax money to support that that large government, that huge, well-funded military, provide the schools and superhighways that train and transport that smart workforce. People who imagine taxes as a national drain rather than a national investment (generally by cherry-picking the least-defensible 1% of budget items as pork while ignoring the 99% that goes to very defensible schools, roads, etc) always imagine that the circumstances of their success are some kind of natural resource that was "just there". No, those circumstances were expensively built and expensively maintained, and recently, that's been done with borrowed money, and it's time to pay up.
People like Ballmer, of course, know all this. Ballmer is bluffing. Call him on it.
Re:Capitalist flight (Score:5, Insightful)
The purpose of business is to make money. Not to be a patriotic cash funnel that supports governmental pet programs. Keep viewing corporations as ATM machines and they *will* relocate to more desirable locations because there are a lot of countries out there that see the benefits of all the jobs that large companies bring. We seem to have lost sight of that fact. Now watch as companies relocate and the country loses ALL of that tax revenue and ALL of those jobs.
Those in charge in government like to think they "create jobs". No, a government job is not a "good" job, it is a drain on the tax base because it generates no wealth. It only helps the individual at the expense of the rest of us. But when the government makes the business climate desirable, businesses come and create good jobs that help both the individual and the nation by generating wealth that feeds back in the economy. Then the government benefits from that added taxation. Everyone wins.
Re:Capitalist flight (Score:5, Insightful)
- Raising corporat taxes doesn't affect the consumer as badly as you believe. Yes some prices get raised, but increased taxation also leads to more cuts internally like plastic desks instead of mahogany, fewer free trips to Vegas, snd so on.
Which in turn depresses the mahogany desk business and Vegas travel business, which causes them to close factories and lay off staff. There is no free lunch, there is no free tax. Right now Vegas is really hurting because people like you think it's really neat to punish businesses that have conventions in Vegas. In the same vein, people who buy heavily-taxed or -regulated goods are choosing not to buy these goods, instead opting to buy something without such hidden added costs -- or opting not to buy at all. If you want to see the results of this, just look at Detroit and how artificially inflated labor rates and benefits (thanks, unions) have made domestic cars expensive, inferior, and unprofitable.
He's turning his back on the country that gave Ballmer opportunity to be where he is today. Industrialist Carnegie came from Scotland and loved the U.S., and maintained loyalty until his death. He would have never entertained the idea of moving factories to China for cheap labor.
And what do you suppose will happen if MS doesn't move? Foreign competition that isn't subject to a crushing corporate tax will then have an advantage over MS. You don't move your labor base because you want to, you do it because if you don't, your competition will. It has nothing to do with greed (a favorite word of the class warfare monger) and everything to do with how the world works in a global labor market.
If California's standard of living drops, then wages will drop, and eventually the factories will move back here because WE will be the cheaper labor than the Chinese.
California's standard of living would have to drop below that of a peasant Chinese factory worker living in a hut with 20 other people before that would happen because that's what labor is like in China. Somehow I don't see that happening.
What could happen -- but won't because people like you refuse to understand basic economics -- is the U.S. government could drastically reduce corporate taxes. If you want see what kind of effects that can have on attracting and keeping new businesses to your country, try here [wordpress.com]. Corporate taxes were lowered. Businesses flocked to it. Tax reveneues increased because of a larger tax base despite a lower marginal rate. The general standard of living for everyone went up. And you're against this idea?
Re:Capitalist flight (Score:3, Insightful)
Re:Like Delaware (Score:4, Insightful)
Take a look at what they've already done. They have already set up development centers in low labor cost countries like India and China. Moving more of those jobs out of the U.S. would just be a natural progression in the quest for lower costs. The worst part of this is that as time goes by the developers in those up and coming countries are getting just as good as their American counterparts. At some point we're looking at a hiring crisis here in America.
But that was under Bush's administration. Bush decided that no technology worker would be paid a fair salary (now competing with outsourced labor prices and illegal H1Bs) or receive overtime. Obama has said he will incur fees for outsourcing and tax breaks for those how don't. Should MS continue to do this, and Obama does anything he said he would (thus far he's mostly followed McCain's plan, or very closely so), MS will pay one way or another.
As a side note, has Obama actually done anything he said he would do? Has Obama done anything that McCain didn't say he would do? Has Obama given any speeches where he didn't steal from Bush?
Re:WTF?!? (Score:3, Insightful)
Re:Capitalist flight (Score:5, Insightful)
"If corporations don't pay tax as so many Internet corporate lick-spittles shriek, then they wouldn't need ridiculously twisted foreign tax accounts and be prancing around like sooks when someone comes along and tells them to meet their obligations in their home countries would they? They would just happily pass this tax burden it along."
Ok, smartass, WHY DO THEY AVOID TAXES?
And the answer is...
Because it increases profits. There, I said it.
Should we allow tax policy to encourage moving profits offshore to avoid taxes and increase profits? Does Microsoft have ANY responsibility to pay their fair (or legal) taxes in the U.S., the country that does, largely, make their success possible? Should we not perhaps have a tax policy that discourages moving jobs offshore merely to avoid taxation? Can we in fact craft a tax policy that does any of this?
Corporations are now pretty much driven by self-interest, in a shortsighted way. Quarterly results, dividends, thwarting competition instead of out-competing, I suppose it was inevitable, but Ballmer's threat to move offshore exposes the culture of 'profit first last and always' at Microsoft.
This culture has resulted in so many industries in the U.S. being moved offshore, most notably to China. Can you buy a single piece of PC hardware that isn't made in China? What does it take to avoid Chinese-manufactured products? Is it ok to send U.S. jobs overseas only to maximize profit?
Ballmer's threat should spur this debate.
Oh, and for what it's worth, if we DID reduce or eliminate corporate taxes, prices probably wouldn't go down - you're right. Greed dictates that corporations take that opportunity to increase profits. Unless one says there is enough price pressure to lower theirs. Then the market starts working again.
Re:Capitalist flight (Score:3, Insightful)
Re:Capitalist flight (Score:3, Insightful)
If corporations don't pay tax as so many Internet corporate lick-spittles shriek, then they wouldn't need ridiculously twisted foreign tax accounts and be prancing around like sooks when someone comes along and tells them to meet their obligations in their home countries would they? They would just happily pass this tax burden it along.
Why does this ridiculous soundbite keep getting regurgitated *every single time* this topic comes up? Because you fail to understand basic economics, that's why.
If the company didn't try to minimize its tax burden, it would have higher operating costs due to higher taxes. That would result in either (a) a lower profit margin or (b) a higher price for the end product or service.
You probably think (a) is a great idea. Hey, let's sock it to those fat, lazy, rich bastards, right? Cut their profits! Only it doesn't work that way. Businesses that make lower profits have less money not only for compensation but also for re-investment and expansion. So the business grows slower if it grows at all. It has less money in the bank to weather a recession. In general, it's always going to be in a worse position than another company with a higher margin, assuming the costs of the end product or service are relatively equal. So your brilliant idea is a recipe for hurting a company and potentially causing layoffs or the wholesale shutdown where tens of thousands of people could lose their jobs. Nice job!
But if we don't reduce profit margin, then the cost must be passed along to the consumer. Thus we get higher prices. If everyone were on the same tax playing field then this wouldn't be quite so detrimental (to the company, not the consumer, mind you), but international companies do not play on a level field. If the U.S. taxes MS more than India would tax an Indian company then the Indian company has a competitive advantage over MS. It could sell its products or services for less and still enjoy the same margin. Or it could sell it for the same price and have a higher margin. Either way, in the long run the Indian company can cause significant harm to the U.S. company, thus losing jobs, stock value, and so forth.
So I'm really, really sorry to have burst your Socialist Worker's Paradise Reality Distortion Field. Higher corporate taxes are an added hidden cost to consumers. Higher taxes are a detriment to domestic job creation due to depressed investment and re-investment. And if you know anything at all about how an economy works you'd know this already.
Re:Bite the hand that feeds... (Score:1, Insightful)
Neither of you actually understand the situation, do you? How is it punitive to try to close holes in our tax system that mean that we are bleeding money? If I work nights as a waiter and don't report my tips to the federal government, I am in violation of the tax laws. Yet Microsoft can make revenues from their products and move the money to a foreign country to avoid being liable for paying taxes on it.
I want to save money too! Does that mean that I can ship all of my tips off to my relatives in Ireland for safe keeping and tell the IRS to go screw? Good luck trying to pass that one off on them. How is telling these fatcats that they have to pay taxes on what they make just like everyone else stifling the "freedom to think and act"? We can argue that there shouldn't be federal taxes or that the tax system should change, but that's not the argument you're making here. Instead you're saying that asking corporations to be held accountable for paying their taxes is somehow stifling. Well, that's the cost of doing business in America... pay up or ship out.
I'd be interested to know what country you think would be oh so wonderful for a company to move to that wouldn't be so "stifling"...
Re:frsot psis (Score:2, Insightful)
Ballmer Threatens To Pull Out of the US
Does this mean Ballmer admits hes been screwing the US for years?
Re:Capitalist flight (Score:5, Insightful)
With that said, who would Microsoft threaten to move? More support operations (which are mostly in India now)? Other teams that are not too far in the hierarchy?
I doubt that this is a big deal.
yep, no more MS in government (Score:3, Insightful)
Absolutely.
If Microsoft moves their jobs out of the US, the US government and military should decide that there's no longer a good reason not to announce a new long-term strategy of migrating all new systems and system upgrades to open-source by default, whenever there's not a good reason to do otherwise. Microsoft will cease to be a strategic US company with the governmental&CIA support that goes with that status. Pres. Obama can announce the strategic move to open source as part of his cuts programme for eliminating wasteful government spending, and declare that part of the new US healthcare initiative is the condition that the main software that runs the system be open-source.
It sounds like a sensible populist move - an accountant can probably calculate how many copies of Windows there are in use in the US governement and military and estimate how much the US taxpayer spends per year on buying proprietary operating systems and office software ... and that big number (or a proportion of it) can be announced as an immediate saving for next year onwards, without the White House having to do a thing except issue a couple of federal directives and notifying state governments that they're expected to follow suit.
The only reason not to do that //now//, is that Microsoft would cry foul and complain that the decision would hurt a flagship US company and cost US jobs. But if the jobs have already been moved out of the US, and the company is currently so successful partly becuase they channel so much paperwork to a foreign tax haven to avoid paying US taxes, then really, who's really being protected other than the company's owners?
If MS move those jobs out of the US, then fuck them. Seriously. Fuck them. Default patriotic behaviour then switches from supporting them to making sure that they're penalised for trying to screw the society that made them successful. Eliminate all US government money that's going their way, as soon as possible, and divert it to people who actually need it, or who are actually trying to make a positive difference to the US economy.
Re:And I'm threatening.. (Score:3, Insightful)
No, like most on /. that post anti-MS crappola and claim they have been using Linux, most are still using XP, some can't unchain themselves from Vista, and some installed Windows 7 RC1 the second it came out. The closest they come to Linux is typing it and occasionally putting in the Ubuntu LiveCD so they can play LinCity or Same and be able to say they use Linux.
Re:Capitalist flight (Score:5, Insightful)
Whenever I buy something in a store, there is very, very, very, little that the government did for me.
Other than provide the safety regulations to minimize the risk the product harms you, the advertising regulations to minimize the chance you are scammed, etc, etc. Your commercial transaction occurs in a complicated environment, much of which is government funded, much of which serves to protect you (nominally, obviously you can debate the efficacy).
In general, I don't think there are many government services that you can fund on a pay-per-use basis. Fire department? Are you kidding? Many places in the country, they have to put your fire out to keep it from spreading to your neighbors. Having a patchwork of private providers mixed in would be a nightmare. For police, similarly -- take all the issues we have with police brutality, privacy violation, etc, and now throw in groups who are not directly run by a group (nominally, at least) constrained by Constitutional limits? No thanks.
Throw in the fact that you're going to have to construct an enormous infrastructure to monitor who's paying for what, whether you get access to x y or z service, etc, and I think a lot of the purported benefit is going to go out the window. Also, for many of these (e.g., libraries), there is more benefit than simply "what do I get today?" Sure, you could allow for private libraries, but they would be driven solely by profit motive. Public libraries serve as important record-keepers and generally provide a service to society in a more general sense than just a pay-for-service sense. Look at the book selection in your typical bookstore and compare it to that in the library. In my experience, the library is a much better place for obscure or old books-- the purpose of the library is to preserve information. The purpose of the bookstore is to sell books. They're both valuable, but sometimes very different.
Re:Capitalist flight (Score:4, Insightful)
Or... You know we could actually have sane tax reform where you simply pay for what you use and you don't have to pay if you don't want to use it.
How is that even remotely viable?
Re:No Surprise (Score:3, Insightful)
Greed.....just as old as prostitution, war and slavery.
There is nothing wrong with wanting more than the bare minimum. The vast majority of wealth around you, including most of the comforts in your own life, were created by people who wanted to make a lot of money by providing people values that raise our standard of living.
Greed coupled with a way of achieving it (i.e. an idea for 'the next big thing') is a great thing.
Re:Capitalist flight (Score:5, Insightful)
Internet "libertarians" seem to forget one imperative thing: Corporations are a 100% Government created *legal* entity. There is NO natural right to form a corporation, "God" or whoever must have forgotten to include that in the package and I'm sure he's very sorry Randians.
So without government power there's NO SUCH THING as a limited liability Corporation. All that exists are sole traders.
So if the government creates it, the government can tax it, destroy it or rule it as it sees fit. If the corp doesn't like it, it may disband at any time and the owners can become sole traders and not be liable under these regulations.
Pretty bloody simple isn't it?
Sometimes I think that many people here long for an aristocracy to rule them.
Re:Capitalist flight (Score:3, Insightful)
That's one way of looking at it.
- ...He's turning his back on the country that gave Ballmer opportunity to be where he is today.
If the country changes, then it is not the country that gave him any opportunity.
Industrialist Carnegie... would have never entertained the idea of moving factories to China for cheap labor.
If he was a smart businessman, he would have taken his business to the place that made the most sense. At the time, it was America.
Raising corporat taxes doesn't affect the consumer as badly as you believe. Yes some prices get raised, but increased taxation also leads to more cuts internally like plastic desks instead of mahogany, fewer free trips to Vegas, snd so on.
And you know this from... running a large corporation? I've never seen the internal operations of a large corporation first hand, so I'll have to take your word. I would think that office supplies are actually on the bottom of the list for cuts. When this economic crisis hit, I didn't hear a lot about companies selling their desks. I heard about job losses. Why would it be any different for a tax increase?
- If California's standard of living drops, then wages will drop, and eventually the factories will move back here because WE will be the cheaper labor than the Chinese.
Eventually they will come back? Why wait? Just cut to the chase and make it more enticing for businesses to operate in California from the get go?
Re:Capitalist flight (Score:5, Insightful)
He's alienating the business and personal user buyers ("Everyone's working together in these difficult economic times .... except Microsoft"), he's damaging future military sales ("If we continue committing stategically to this company's products, there's no guarantee that the support for these systems won't be under the jurisdiction of a foreign power in five years' time"), and he's also damaging Microsoft's influence over governmental sales and government legislation ("Now we're finally free to pass laws and directives that might hurt Microsoft sales (such as deciding to move to open-source), because if anyone complains that we're risking US jobs, we can now reply that Microsoft's CEO has suggested that those US jobs are liable to disappear anyway, at short notice").
Comment removed (Score:5, Insightful)
Re:Capitalist flight (Score:4, Insightful)
There is absolutely nothing unpatriotic about speaking out against tyranny.
Additionally, if consumers don't pay the corporate tax, then who does? Even if it doesn't affect prices and only affects the profit margin, that is still bad because the company is not profiting as much as they would have been, thus an industry cannot satisfy demand as effectively, and consumers end up getting ripped off second hand. Cutting into profits is a very bad thing to do.
Re:Capitalist flight (Score:5, Insightful)
The costs end up on the consumer either way. If you tax the corporations, then they raise the price of their goods, consumers pay more. If you don't tax the corporations, then the government will directly tax the people even more to make up for the income that they aren't getting from corporate taxes.
We pay either way. The government requires money to meet its many obligations, and it's going to collect that money through taxes of one sort or the other.
The corporation that I'm buying from is reliant on the highways and bridges that it has to truck its products across, and those highways and bridges need to get paid for. Either I pay the company which than pays the government, or I pay the government directly. If the company is paying, it factors that cost into its prices, and then as a consumer, I can see those extra costs and make a more informed purchasing decision. And a well designed corporate tax system would have the added benefit of compelling companies to use those public resources more efficiently, which would lower their tax burden, and then lower their prices.
Re:Capitalist flight (Score:4, Insightful)
The problem with "pay only for what you use" is that there are many things that have substantial fixed costs (like roads, sewers, etc.). These goods give only a limited amount of direct benefit to each consumer, but, the positive externalities they justify the cost.
As a more concrete example, if we paid only for what we used, there would be no interstate highway systems.
Re:No (Score:4, Insightful)
Providing a product or services used by billions is not seen as a benefit?
Your pitiful reasoning would lead "instantly" to the USA being a 3rd world country. This country is only as powerful and advanced as it is *because* of the innovation, services and products created by these "evil" corporations.
The majority of the US income (taxes) *comes* from these "evil" corporations. How d you plan to support the welfare needs that are already over0burdening our tax system if these corporations no longer operate in the US?
Lastly, corporations are run by individuals. These individuals *do* have rights. One of those rights is to determine *where* and *how* they do business so long as their decisions do not present a clear an present danger to the rights of others. *You* do not have the right to tell them how to do business. You *do* have the right to start your own and run it how *you* see fit.
MS CEO Steve Ballmer is a Liar (Score:3, Insightful)
MS CEO Steve Ballmer lied about a false programmer shortage for decades. Republicans need for once to grow a pair and call his bluff. Quit coddling cronies.
Microsoft stifles innovation. Don't let the door hit you on the way out. He lied then. He is lying now.
Re:Capitalist flight (Score:3, Insightful)
Now, that figure has risen to around, or over 73%. This "obligation to the shareholders" baloney is a nifty neocon mindless chant, but since so many of the American laws have been written - in a concentrated fashion over the previous 20 years - giving special privileges to corporations - and making almost everything illegal now for the citizens - such crapola doesn't cut it. Legalizing fraud don't make it right, doodette.....
Re:Bite the hand that feeds... (Score:5, Insightful)
Yeah, cause clearly the government has done nothing to help the companies within its borders. It certainly doesn't provide education for their workforce, roads for their commuters, patent/copyright/trademark protection, investment in pure research that forms the basis of private R&D, emergency personnel to save them from natural disasters, military protection, retirement and insurance benefits for their employees, regulation of the markets so their stock can't be manipulated, and so forth.
Yup, those greedy government bastards! Demanding we provide the money for the services they provide!
Re:Capitalist flight (Score:5, Insightful)
"Because you fail to understand basic economics, that's why."
No no I don't. And you've set up one big fat straw man to knock down there in your long ideologically driven fairy tale.
I get it - you found religion in Randian free market economic theory. Very nice, the *real* world has what we call leeching bastards. People who will *live* in a country, use said countries resources as paid for by *everyone else* to make themselves billions of dollars and then work as hard as they can to pay NOTHING into the system that everyone else has worked towards setting up and maintaining that protects said leeching bastard to allow them to make that sort of money in the first place.
I suppose you think the old aristocracies deserved their position as well. Well I guess they had plenty of lick-spittles too!
"Socialist Worker's Paradise Reality" Lol ok what? That was a joke if you read my last post. I'm a contractor - self employed or in other words a small business. You know the real engine of every economy on earth. I'm about as far from "Socialist" as is *realistically* possible without becoming...well, like you.
I'm also allergic to religious fanatics.
Re:Capitalist flight (Score:5, Insightful)
"avoiding extremely high US taxes."
This I don't understand.
The US doesn't have "extremely high taxes." Compared to the third world it does I suppose but if that's the comparison that has to be made then that's pretty sad.
Compared to the first world it's in the lower end.
Re:Capitalist flight (Score:2, Insightful)
Internet "libertarians" seem to forget one imperative thing:
What's an "Internet libertarian" and how is that different to a libertarian in the flesh? Do you get "Internet socialists" too? How about "telephone socialists" for people who advocate socialism in phone conversations? Does using "Internet" as an adjective in front of an ideology mean anything at all?
Corporations are a 100% Government created *legal* entity. There is NO natural right to form a corporation
So? There are no "natural" property rights either, nor is there a "natural" right not to be murdered by your neighbour. What's your point?
Libertarians, btw, don't profess that there should not be a government, nor did Rand - that's an anarchist, a completely different thing. If you want to criticize something, at least make sure you have a clue of the very basics of what that thing is.
"God" or whoever must have forgotten to include that in the package and I'm sure he's very sorry Randians.
So if the government creates it, the government can tax it, destroy it or rule it as it sees fit.
Wrong, wrong, wrong. Governments are servants to the people, created by and for the people - not all-powerful authoritarian entities that lord over us as subservient sheep. They can "tax it, destroy it or rule it" only as far as people want that. And most people actually don't want to get taxed to death, funnily enough - in fact the majority of people only pay taxes because they have to, and would rather pay fewer taxes than more. The majority of people also want the right to form corporations. And the majority of people also want the taxes for the corporations they have a right to form to not be excessive . So what's your point anyway?
If the corp doesn't like it, it may disband at any time and the owners can become sole traders and not be liable under these regulations.
Pretty bloody simple isn't it?
No, actually, it's one of the most idiotic things I've ever heard in a very long time - can you imagine trying to run a company like Microsoft as a couple hundred thousand "sole traders"? Don't be ridiculous. I can't see how you managed to be modded up, because nothing in your post makes any sense at all.
Re:Capitalist flight (Score:5, Insightful)
Heh.
I always enjoy watching somebody who has their head screwed on right destroying the phony arguments of right wing lunatics.
You couldn't have described the tax evasion crowd any better.
Leeches - they consume government services - military protection, social safety nets that keep the country stable, educated workforce, and everything else that comes with living in a modern country.
Then when the time comes to pay the bill for all these services, they can't stop making excuses.
And now what - threatening to move jobs oversees?
Microsoft has been moving jobs overseas as fast as they can for as long as I can remember. Luckily there are some things that Americans still do better than lower cost foreign workers. And now that asshat Ballmer wants to threaten to continue doing what he has been doing for years if Microsoft has to pay its taxes?
Screw Steve Ballmer, and all the other leeches that run and hide when it's time to pay the bill.
Re:Capitalist flight (Score:5, Insightful)
Correct. It's unlikely that Microsoft could be sued successfully in a US court for failing to evade US taxes. Corporate leadership has certain responsibilities, including remaining in compliance with the law. No judge is going to sanction a CEO for taking actions that keep the company in better compliance, even if it is possible to evade the laws legally.
Re:Capitalist flight (Score:1, Insightful)
Yet you seem to conveniently forget the corporations benefit from all the things taxes pay for like roads, education (ideally providing a skilled, innovative and creative workforce), policing, healthcare (again to provide a healthy, productive and long-lived workforce that can better contribute), defence and laws that (again, ideally) provide a set of fair-play rules that let everybody compete to provide customers options they might otherwise be denied (and to those who say all regulation is bad - just try playing *any* competitive sport while suspending all the rules and see how far you get...). It is only fair that corporations acknowledge that and pay back something in return and stop trying to (quite frankly) rip the rest of us off (and I say this as both a (former) business owner and a shareholder in a Fortune 500 company).
Before trotting out ideological insults like "Socialist Worker's Paradise" it might be worthwhile noting that the Social Democracies of the Nordic region are considered to excel in most areas of living while also having some very impressively wealthy corporations. The two are not mutually exclusive despite the drivel that is propounded by both ideological extremes (because of course ideology never really works in reality).
Please remove head from ass.
drunkmods (Score:5, Insightful)
a government job is not a "good" job, it is a drain on the tax base because it generates no wealth. It only helps the individual at the expense of the rest of us.
yeah, man. the military, police, firefighters, national park/forest system, local parks, judiciary, cia, roads, and schools are a real fuckin' drain. never did me any good; but goddamn, those bourgeois grunts and jarheads sure are living the high life (at the expense of the rest of us) in baghdad and kabul.
generating wealth isn't the only measure of usefulness. i agree with a lot of the other stuff you said, but the part i quoted is downright asinine.
Re:And I'm threatening.. (Score:3, Insightful)
Extremely high US taxes? (Score:2, Insightful)
Like the taxes that paid for this bridge [nwsource.com]?
These days large corporations expect the government to pay for the land their buildings sit on, the buildings themselves, and an annual stipend to cover part of their operating costs. It's like the reverse of taxation.
Re:Did no one read the article? (Score:3, Insightful)
Because in far too many cases these are profits that exist overseas purely on paper.
Re:No (Score:5, Insightful)
Horseshit.
The US is what it is because of the hard work, dedication, and innovation of its people, not some legal structure such as a corporation.
It was people who struggled to open the frontiers. It was people who invested/risked their hearts, souls, and fortunes to bring this country into existence. It was people who worked hard, sacrificed all they had to make this country strong. It's people who have innovated. It's people who have created and invented.
A corporation, in and of itself, can do absolutely nothing. It's the people that run the corporation who are responsible for its success or failure. Furthermore, this country was wildly successful long before multinational corporations began to get get laws passed that coddle them and punish individuals who are guilty of the same types of actions.
This country can survive without corrupt corporations. They do nothing but concentrate wealth in as few as hands as possible and make the citizens of this country into nothing more than nameless, faceless cogs in a machine whom the corporations consider to be nothing more than pawns.
That is the antithesis of what brought the US out of nothing more than wilderness to the point of being the most powerful nation on earth.
Re:MS CEO Steve Ballmer is a Liar (Score:5, Insightful)
Republicans need for once to grow a pair and call his bluff.
I think you got the wrong party there. It's the Democrats (as a party) that are trying to close tax loopholes and are worried about American jobs. The Republicans (as a party) spend their time and power eliminating barriers to corporations' avarice, which includes lowering taxes (even if via loopholes), instating self-regulation (like the coal industry is best suited to regulate air quality! WTF?), and moving jobs overseas.
The Republicans are not going to call Ballmer's bluff. On the contrary, they find such rhetoric useful to promote their agenda.
Re:Capitalist flight (Score:2, Insightful)
Inflation (and thus devaluation) of a currency is a way of taxing the people who hold net positive amounts of that currency. And in the USA's case - it taxes the countries holding US dollars too.
The problem for the USA is if other countries stop using US dollars to buy stuff and use something else like the Euro. Then when the USA prints money, they'll be just like Zimbabwe printing money.
Otherwise, it's like Mugabe (US Gov) printing money, and passing some of it to Mugabe's Cronies (friends of the US Gov - previously the US citizens fell into that category), and the Zimbabweans (rest of the world) having to buy bread using wheelbarrows of cash.
enforcing stupid laws (Score:3, Insightful)
When large portions of those subject to a law regard it with derision, then the law is stupid.
Take for instance alcohol prohibition, recreational drug prohibition, prostitution criminalization and abusive copyright. All widely ridiculed and flaunted.
Tax loopholes are just tax cuts disguised to preserve politicians' careers. Let's get rid of the loopholes, so that we can discuss what taxes really should be. Out in the light of day like this, taxes may even start to make sense.
Re:MS CEO Steve Ballmer is a Liar (Score:3, Insightful)
Whether Republicans or Democrats are up in arms about this or not, the real problem is that, while both parties have been WELL aware of this/these loopholes, it only now that President Obama is calling them a "scam".
That, label, in itself, is a scam. This label comes from a lawyer, who like all lawyers, liberally use laws to get around things like: regulations and, sadly, justice.
Re:Capitalist flight (Score:3, Insightful)
And my purpose for working is to be able to have a good living and store up a pile of cash for my retirement. Shall I evade taxes as well? Who, then, will pay taxes?
Taxes ARE an evil, but they ARE necessary. Certainly MS is happy to have services provided by the U.S. government and various local governments, why do they get a pass to leach off of U.S. taxpayers like that? Don't they get enough cash from Americans as it is?
To answer the question of "what benefits", consider how they would like it if some U.S. Citizen starts selling Windows and Office CDs (with all DRM hacked out, of course) for $10 each and the FBI said "Not our problem".
Remedial history only taught in graduate class (Score:1, Insightful)
Getting back to history, the landowners in the colonies resisted paying taxes that mostly only benefited the rich landowners in England, calling it taxation without representation. The rich colonialists wanted to keep the benefits from public resources (once a few dozens of millions of Indians were killed off) and cheap labor (including Scandinavians, Africans, and ironically in this case the Irish). And so set up a country where they controlled the laws and wealth (had to have land to vote). To the wealthy, the capitalists, taxes and public resources should benefit the wealthy, anything else is the ever-vague "bad for the country."
Anything that benefits the public has been a struggle and, even though there's much to be ashamed of and a long to-do list, is one of the reasons I remain proud of this country.
Re:No (Score:4, Insightful)
One minute after Ballmer said that, MS should have ceased to be a legal operating US company. He can go try his luck someplace else
Actually, though they'd take a bit of a hit, Microsoft would probably survive just fine somewhere else - and they'd take 89000 jobs with them (and possibly millions of secondary jobs) too. You really think that's best for the US?
Re:MS CEO Steve Ballmer is a Liar (Score:3, Insightful)
I think you got the wrong party there. It's the Democrats (as a party) that are trying to close tax loopholes and are worried about American jobs.
Worried about American jobs? LOL!
Son, they're just a different set of prostitutes sucking a different set of dicks. They don't care any more about the common man than their rivals. They simply have a different marketing campaign to win votes. Behind the scenes, they'd sell the average American out in exchange for cash just as quickly.
Which political party you vote for is perhaps the purest fashion choice you can make. With cars, shoes, clothes, music, etc. one can debate merit, but with politics it's just fashion.
Re:No (Score:2, Insightful)
traitorous scumbags.
Sure, force them to fulfill their so-called "obligations" - we all know the next steps - they leave the country for more free countries elsewhere - and then the next step, make it illegal for them to leave the country! Starting to sound like the old Soviet Union yet?
US Taxation of Worldwide Income (Score:1, Insightful)
This is not just a Microsoft issue. This is a serious consideration of any multinational corporation that has its worldwide headquarters located in the United States. The U.S. government taxes a U.S. corporation on its WORLDWIDE income, while almost all other countries tax only the income that is earned in the territory for which they are based. On top of that, most of those other countries have a substantially lower corporate tax rate. The current U.S. system allows corporations to defer some of the taxation on worldwide income. Read that... DEFER, not ultimately eliminate. The current administration wants to make changes that almost eliminate that deferral system - meaning that all U.S. corps will pay that rate regardless of the situation - even if they lack the wherewithal to pay in the current year.
This is not about corporations "hiding" money overseas. They use that money in financing structures to acquire or build out their worldwide operations. Politicians (both GOP and DEM) want people to believe that they are "hiding" money because the U.S. government is in a serious need for extra cash. The easiest way to do it is to adjust how they tax international income. I'll be honest with you, almost all multinational corporations are currently investigating a change in structure. Either spinning off their international operations into a new/separate company or finding a way to outbound the HQ (usually via a merger with a foreign entity).
Everyone can make uninformed statements bashing MS. But let's be honest, this affects every large company and ultimately may decide whether or not you are still employed. Many companies will only move management and key corporate groups like accounting, etc. But tech companies can move everything if they want... especially if web based. Obviously, each company will approach this differently... but the outcome will not be favorable to the private sector in America.
Re:MS CEO Steve Ballmer is a Liar (Score:1, Insightful)
Re:MS CEO Steve Ballmer is a Liar (Score:4, Insightful)
If we elected the same congress and senate representatives then yes, the conditions would be the same. With only superficial differences.
How about universal, world-wide corporate tax, Mr? (Score:1, Insightful)
With the logic of Mr Ballmer and other leading CEO's of the industrial world basically no decent business should stay in the USA and in the G7 countries, because wages and the cost of living, including taxes will always be higher there than in some other countries.
But if you truly follow the logic, you have to realize that eventually only the sucker corporations would stay in any country, the real smart ones would move truly off-shore, somewhere to the space, beyond the boundaries of nations, regions and any authority which collects taxes on behalf of the public. Because clearly that would provide the best shareholder value.
Alternatively, all elected governments in all countries should and will agree and on the same, universal corporate tax, which would prevent corporations to shop around.
Universal world-wide corporate, income tax, etc. related to labour costs would not only stop the divide and conquer strategy for corporations to start bidding war in different countries for the lowest tax to attract corporations. It would eventually allow distribute wealth in a more even and maybe more "human" way.
It's impossible not to see the clear tendency that wealth is concentrating in the hands of fewer and fewer people (yes, shareholders are eventually people, not corporations). Part of the reason for the collapse of the American car industry is that moving decent paying jobs out of the US collapsed the consumer power to afford American cars.
Americans could not afford American cars because their average earnings have been shrinking and eventually insufficient to buy those cars. This has been fact for at least a decade, but different financial constructions, e.g. lease, loans, re-mortgaging the house did not make it obvious, until the financial system also collapsed.
The biggest issue is the steady and fatally shrinking buying power of the American (and most other) public. Some regions grab part of that income (like China, India lately) buy grabbing a piece of pie of corporate outsourcing, but the difference still stays in the pockets of corporate shareholders, which can lower not only wages but minimize corporate taxes by shifting to different regions, countries. Please don't argue that the "public" is the shareholder of corporations, etc. It is partially, but this is about the major economic tendency. Although there are large number of micro shareholders, there is little doubt that as a tendency, buying power for the masses is shrinking, which is eventually a huge problem for everyone.
Even for corporations, since they still make products, services for customers, who are still the same people, who loose their buying power. Population growth, shifting growth regions may offsets temporarily the shrinking income, just like car and home loans did in the US, but eventually entire industries can collapse very fast if the public does not have enough income to purchase. Again, look at the American car industry and real estate after revolving bridge loans can no longer offset the evaporating buying power.
American income now more suitable for a $20.000 Asian made car, than the $40.000 US made car. But if the buying power shrinks at the same rate and the available loan dries up, Americans might be eligible for Tata in the next decade.
Mr. Ballmer is yet to see similar collapse for the market for Microsoft products, but the writing is on the wall for every company.
The US and possibly other countries can be bankrupt one by one, but eventually there will be nowhere to go - the only alternative is more even sharing of wealth, just like at the time of Mr. Ford, who did not only introduce assembly line, but also introduced worker wages, which allowed to buy the cars they produced.
Re:Capitalist flight (Score:2, Insightful)
a smoker complaining that non smokers live too long, and burden the health system... now ive read everything.
Re:MS CEO Steve Ballmer is a Liar (Score:1, Insightful)
Re:The Solution Is Simple... (Score:2, Insightful)
That's exactly wrong. Corporate income tax is to no one's advantage and should be abolished.
Why?
Corporate income tax is like any other cost of production: it's rolled into the price of the product. Thus, when I buy $ITEM, the corporate income tax is paid by *me* in addition to the other components of the price of the product.
If corporate income tax were abolished, it would all be paid by personal income tax, and then we'd see how much we're *really* paying, and maybe - just maybe - that would be enough to make people refuse to stand for it anymore.
Oh wait, maybe corporate income tax is to one entity's advantage - the government's as a tool to help it pull the wool over the eyes of the people.
Of course, if they would abolish it and make the US a corporate tax haven, it would bring so much business and jobs to the United States that we could get along just fine with lower income taxes, too.
Re:Capitalist flight (Score:2, Insightful)
I like how considerate your post it; there's one problem with the whole theory imbued therein, which is those "loopholes" aren't accidents being abused: a great deal of them were put there as "incentives" for people to create and run corporations, and particularly to create jobs doing this. It's not perfect, but trying to "close" the "loopholes" is a good way to kill the space which they were meant to let private ingenuity fill.
p.s. I reposted this, accidentally posted anonymously; anyone know how to get some kind of admin to delete the first copy? u
Re:MS CEO Steve Ballmer is a Liar (Score:5, Insightful)
Only one Senator on either side opposed the Patriot Act [wikipedia.org], the piece of legislation which semi-authorized the "executive trespasses." Pres. Obama has gone on record since his election for supporting warrantless wiretaps [wired.com].
In short, OrangeTide isn't the only one who think that there would be only "superficial differences."
Re:And I'm threatening.. (Score:2, Insightful)
Then MS and any other supposed 'American' corporation should be charged an 'exit' fee equal to twenty times that too oppressive tax burden - and be barred from ever receiving any Federal contract or subcontract.
Um, reread what you just wrote and look at any convenient definition of tyranny. As for federal contracts, have you been paying any attention to news of late? The only governmental contracts that will matter soon will be with the PRC and perhaps Japan and/or India.
Re:MS CEO Steve Ballmer is a Liar (Score:1, Insightful)
Bullshit.
Many a comedian have made that same argument but it's fundamentally fallacious and you know it. Your premise (politicians are all evil bastards) and conclusion (political affiliation is a fashion statement) don't match up. Politicians have a lot of power to do things which affect our everyday life. Considering that the two parties vehemently disagree on so many issues, despite how morally decrepit they may both be, the outcomes of those decisions are important. Even if the choice is between a Turd Sandwich and a Giant Douche, it still matters (fuck you South Park :P ).
Re:MS CEO Steve Ballmer is a Liar (Score:2, Insightful)
We did elect Al Gore. The supreme court gave it to Bush, while Al backed down.
Oh give it a FUCKING REST finally.
The Supreme Court refused to let the Florida courts order an unfair change in the way the ballots were counted. That's it.
A state passes laws that dictate how votes are to be counted, and you can't just throw those out and do the count a different way to specifically make one candidate win. Even if you are a heavily Democrat state and it would make the Democrat win.
http://en.wikipedia.org/wiki/Bush_v._Gore [wikipedia.org]
http://en.wikipedia.org/wiki/Florida_election_recount [wikipedia.org]
Re:No (Score:4, Insightful)