Friday, January 16, 2009

Ask What You Can Do To Your Country

While the Obamas are starting off what appears to be a good solid public service initiative for us all, the outgoing maladministration is piling up one proof of its malfeasance after another. The Treasury Secretary handed out big bundles of cash to financial institutions reminiscent of the bundles of cash handed out to contractors in Iraq, which did no good whatsoever. Prosaically, nothing good is coming of the bundles of bailout cash either.

A majority of America's largest publicly traded companies and the U.S. government's largest federal contractors -- including some receiving millions in federal bailout money -- use multiple subsidiaries in offshore tax havens to conduct business and avoid paying U.S. taxes, a new report finds.

The new Government Accountability Office (GAO) report, released today by Sens. Byron L. Dorgan (D-N.D.) and Carl M. Levin (D-Mich.), lists Citigroup and Morgan Stanley as having set up hundreds of tax haven subsidiaries, along with American International Group and Bank of America. Also in the tax-haven list are well-known companies and such federal contractors as American Express, Pepsi and Caterpillar.

GAO, searching publicly available data filed with the Securities and Exchange Commission, determined that 83 of the 100 largest publicly traded corporations and 63 of the 100 largest federal contractors maintain tax havens in 50 subsidiaries. Dorgan and Levin said they requested the updated report from one several years ago because they are focused on combating offshore tax abuses, which they estimated cause $100 billion in lost U.S. tax revenue each year.

"This report shows that some of our country's largest companies and federal contractors, many of which are household names, continue to use offshore tax havens to avoid paying their fair share of taxes to the U.S. And, some of those companies have even received emergency economic funds from the government," Dorgan said. "I think we should take action to shut down these tax dodgers, and we will be introducing legislation to do just that."

The incoming Obama administration will have a full plate, and seeing that this corporate welfare ends is going to be difficult but necessary. Piling our national burdens onto individuals while corporations take funds and jobs offshore has predictably bankrupted the very consumers our economy depends on.

There is no way this can be tolerated. It's not just unethical, it's unsound economics. Why didn't anyone in the business community, or their erstwhile overseers, stop this theft? Oh, right, it's that 'pro-business' ethic. Does anyone believe that anymore?

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