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Suck it up, boys. Pay your taxes like the rest of us. You're sitting on huge war chests of cash. You can afford to contribute a little bit of that to the com

Suck it up, boys. Pay your taxes like the rest of us. You're sitting on huge war chests of cash. You can afford to contribute a little bit of that to the common good. US companies in general are sitting on $2Trillion in cash. Productivity is sky high, because of all the lay offs across the economy, and profits are generally up across the board in most sectors of the economy. US companies aren't spending because they don't want to spend. They aren't hiring because they are productive enough and are profitable enough without hiring. They are also scared because of all the uncertainty in the financial sector, not necessarily because of the high taxes. The few people that are actually putting money to work in this economy are angel investors and VC's by giving small engineering teams small amounts of cash as well as leeway to experiment at building interesting products.

Retric 15y ago
They have little reason to suck it up and pay these taxes. It's easy to book of shore 'profits' and with an occational tax holiday there is huge incentive to do so. Just create a a 'paperclip' in an offshore company and bill the US company 1billion for it and you get to avoid paying taxes what joy. Then wait a few years and bring that money home on a semi regular holiday. PS: Or we could say on Dec 31 there will be a one time 50% tax on any money in offshore accounts and you can clean up this mess real quick with them quickly moving all that money back home.
sunsu 15y ago
I don't consider paying taxes to a bloated and inefficient government to be the "common good".
- jimworm 15y ago
  Isn't a bloated and inefficient government a problem to be solved with elections though? Well, officially anyway.
  - phillmv 15y ago
    I would think that that is the whole point of a democracy. Edit: I am sincerely curious about why I'm being downvoted. If you think your government is broken, work to fix it.
    - kiba 15y ago
      There are thousand of problems to fix. The infrastructure is going to collapse under the weight of non-maintenance, there are people infected with HIV virus, Africa needs help to develop, strong artificial intelligence might someday start making paperclip out of humans, etc. Yeah, it's a problem. The problem is we can't all work on every problem. Some of us have jobs, personal crisis, or is already working on one of those problem.
      - phillmv 15y ago
        You prioritize, you build institutions, you work within your community. >Some of us have jobs, personal crisis, or is already working on one of those problem. Most of us do fuck all. I should know, I'm sitting in my underwear past noon on a Sunday commenting on HN.
        kiba 15y ago
        And some of us think democracy is a really stupid idea. Mostly, I just focus on internal improvement, since it is something that I can change within myself. Trying to take on the local corrupt buffoon of a government thinking you can rule the city better is a definition of hubris.
        phillmv 15y ago
        >Trying to take on the local corrupt buffoon of a government thinking you can rule the city better is a definition of hubris. It's no more arrogant than starting a company because you think you can make a better product or service than any of your competitors.
        15y ago
- phillmv 15y ago
  Taxes are the price of civilization. Suck it up. I would spend more time being annoyed by all the people charging me rents http://en.wikipedia.org/wiki/Economic_rent http://en.wikipedia.org/wiki/Economic_rent
  - gyardley 15y ago
    I'll suck it up when the price I pay for civilization is the same as everyone else's. I don't pay 10x as much as my neighbor for the same candy bar or cell phone plan or pair of jeans. Why smart people consider it 'fair' for my neighbor to pay next-to-nothing for 'civilization' while I have to pay a substantial chunk of my income, I'll never understand. Same service, same price.
    - phillmv 15y ago
      Because you would benefit disproportionately from those same services due to the diminishing marginal utility of income. In real terms, if you don't engage in progressive taxation you are being subsidized by those poorer than yourself and subsidizing those richer than yourself.
      - gyardley 15y ago
        Is your belief in 'diminishing marginal utility of income' your real argument? The diminishing marginal utility of income is an assumption. In most cases it's a valid assumption, but not always. Let's say I could show you a situation where a certain individual's marginal utility of income increased with income - for a portion of the utility curve, the curve is convex, not concave. Such situations aren't typical, but they do exist - 'diminishing marginal utility' isn't a law of nature, it's just an assumption. In such a situation, maximizing utility means certain less well-off people (those on the concave portion of the utility curve) should be subsidizing the more well-off people (those on the convex portion of the utility curve). In other words, if the goal of taxation is simply to increase utility, in those situations the poor should be subsidizing the rich. If I can show you that for me, each additional dollar has increased utility, you should be willing to concede that that the poor should be subsidizing me. Yet I've never met a person who used the 'diminished marginal utility of income' argument who was willing to concede that. If you are, you'll be the first. In other words, arguing diminishing marginal utility's usually just a time-wasting distraction. While it sounds good, I suspect it's not the reason for your argument all.
- erikpukinskis 15y ago
  Do you ever receive packages from UPS? Do buy food from a grocery store? How do you think those things get paid for? You really think the $2 per pound you pay for tomatoes includes the true cost of growing a tomato and getting it into your car? If so, I've got a bridge you might be interested in...
  - kiba 15y ago
    Some people are not grateful for the roads that government build, like critics of suburban development, enemies of car culture, etc.
    - thematt 15y ago
      Please stop promoting this nonsense that our current level of taxation is needed because of infrastructure needs. Transportation accounts for a measly 4% of the federal budget. Most of our tax dollars go towards military and paying for the old people in society, both of which are politically-charged budget items that politicians refuse to address. http://www.investorguide.com/taxtrackr/ http://www.investorguide.com/taxtrackr/
      - lurker19 15y ago
        Lowering taxes does not stop the military. Spending is one side, taxing is the other. Bills that run up must be paid, or war fought over them. The solution to overspending is to find a way to stop the spending. Regarding old people, as a group they worked pretty hard to build the modern world and its conveniences and efficiencies that we enjoy, so I don't mind paying them dividends.
  - sunsu 15y ago
    Of course I've received a package from the bankrupt and insolvent USPS and yes I also buy food from grocery stores that receive food over roads badly in need of repair. I didn't say that the government does not do or provide ANY good things. However that does not mean that paying taxes to a government that IS inefficient and bloated can or should be called the "common good". The same government spent over a trillion dollars on wars in Iraq and Afghanistan. Are those wars part of the common good? The same government spends half a trillion on welfare of various sorts. Is that welfare part of the common good? The same government got us almost 15 trillion dollars in debt. Is that debt part of the common good? Different people may say yes to one, two, or all of the three things above. I, however, would say no to all of them. To me, paying taxes to the government is most definitely NOT the common good.
nhebb 15y ago
> US companies aren't spending because they don't want to spend. They aren't hiring because they are productive enough and are profitable enough without hiring. Companies spend more and hire more when it's necessary to meet additional demand. If there is no additional demand, then they don't. It's not because they don't want to spend or are content with existing profits, it's because consumer demand is currently very weak. With 40% of US mortgages underwater, it's going to take a while before consumer demand strengthens again.
- TallTalesOrTrue 15y ago
  And the consumer demand is very directly influenced by the job market. With so many people out of work. Many of us who do have jobs are cautious to not spend beyond our means. Its a vicious circle. Of course the goal of a public company to make money I can't blame these guys to hoarde all the money they can. Thats what their shareholders and directors demand.
deleted 15y ago
[deleted]
jeffdavis 15y ago
"Pay your taxes like the rest of us." They don't owe any taxes if they keep the money outside the country. People tend to think of taxes like "skimming" off the top, and like some kind of inevitable thing that doesn't affect your decisions. But that is the wrong way to think about it: when taxes are high enough to have a significant impact, they do affect taxpayer decisions. You seem to be saying that they should keep making decisions as if there were no taxes, and then pay high taxes because of those decisions. But that's completely unrealistic. When taxes are higher than a trivial amount, the correct way to think about them is as policy that will have lots of effects; some obvious and some not obvious.
- rmrm 15y ago
  Exactly, taxes act as incentives and de-incentives. Why do we have a health care system based on employer based insurance? Because employer based healthcare is tax deductible, and personal health care is not. What effect does the home mortgage interest deduction, and home sale capital income tax holiday have on the price of houses -- they result in higher housing prices because they provide incentive for more leverage and reaching for the highest appreciation. What is the result of the decision for us to tax personal income rather than personal consumption -- more consumption and less saving. What we tax and how we tax it has a very real impact on behavior around that thing. The long term effect of large amounts of cash overseas due to having a higher tax rate here is ultimately to build more operations overseas, to use it. That is how the incentive is set up. Not a fan of a tax holiday, but am a fan of reducing that incentive by bringing our corporate rates lower.
  - lurker19 15y ago
    We have employer based health insurance in the US because insurance works on a group level, not individual level, when the risk being insured is not under the control of the consumer. We have employer-based health care, and transit subsidy, and meal subsidy, and all that crap, because of stupid tax laws, yes.
csmt 15y ago
Google and many other companies route their overseas earnings to Bermuda through Ireland and Holland, and effectively pay 2.4% tax on that money since Bermuda doesn't have any corporate taxes: http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-sho...

Retric 15y ago

They have little reason to suck it up and pay these taxes. It's easy to book of shore 'profits' and with an occational tax holiday there is huge incentive to do so. Just create a a 'paperclip' in an offshore company and bill the US company 1billion for it and you get to avoid paying taxes what joy. Then wait a few years and bring that money home on a semi regular holiday. PS: Or we could say on Dec 31 there will be a one time 50% tax on any money in offshore accounts and you can clean up this mess real quick with them quickly moving all that money back home.

sunsu 15y ago

I don't consider paying taxes to a bloated and inefficient government to be the "common good".

jimworm 15y ago
Isn't a bloated and inefficient government a problem to be solved with elections though? Well, officially anyway.
- phillmv 15y ago
  I would think that that is the whole point of a democracy. Edit: I am sincerely curious about why I'm being downvoted. If you think your government is broken, work to fix it.
  - kiba 15y ago
    There are thousand of problems to fix. The infrastructure is going to collapse under the weight of non-maintenance, there are people infected with HIV virus, Africa needs help to develop, strong artificial intelligence might someday start making paperclip out of humans, etc. Yeah, it's a problem. The problem is we can't all work on every problem. Some of us have jobs, personal crisis, or is already working on one of those problem.
    - phillmv 15y ago
      You prioritize, you build institutions, you work within your community. >Some of us have jobs, personal crisis, or is already working on one of those problem. Most of us do fuck all. I should know, I'm sitting in my underwear past noon on a Sunday commenting on HN.
      - kiba 15y ago
        And some of us think democracy is a really stupid idea. Mostly, I just focus on internal improvement, since it is something that I can change within myself. Trying to take on the local corrupt buffoon of a government thinking you can rule the city better is a definition of hubris.
        phillmv 15y ago
        >Trying to take on the local corrupt buffoon of a government thinking you can rule the city better is a definition of hubris. It's no more arrogant than starting a company because you think you can make a better product or service than any of your competitors.
      - 15y ago
phillmv 15y ago
Taxes are the price of civilization. Suck it up. I would spend more time being annoyed by all the people charging me rents http://en.wikipedia.org/wiki/Economic_rent http://en.wikipedia.org/wiki/Economic_rent
- gyardley 15y ago
  I'll suck it up when the price I pay for civilization is the same as everyone else's. I don't pay 10x as much as my neighbor for the same candy bar or cell phone plan or pair of jeans. Why smart people consider it 'fair' for my neighbor to pay next-to-nothing for 'civilization' while I have to pay a substantial chunk of my income, I'll never understand. Same service, same price.
  - phillmv 15y ago
    Because you would benefit disproportionately from those same services due to the diminishing marginal utility of income. In real terms, if you don't engage in progressive taxation you are being subsidized by those poorer than yourself and subsidizing those richer than yourself.
    - gyardley 15y ago
      Is your belief in 'diminishing marginal utility of income' your real argument? The diminishing marginal utility of income is an assumption. In most cases it's a valid assumption, but not always. Let's say I could show you a situation where a certain individual's marginal utility of income increased with income - for a portion of the utility curve, the curve is convex, not concave. Such situations aren't typical, but they do exist - 'diminishing marginal utility' isn't a law of nature, it's just an assumption. In such a situation, maximizing utility means certain less well-off people (those on the concave portion of the utility curve) should be subsidizing the more well-off people (those on the convex portion of the utility curve). In other words, if the goal of taxation is simply to increase utility, in those situations the poor should be subsidizing the rich. If I can show you that for me, each additional dollar has increased utility, you should be willing to concede that that the poor should be subsidizing me. Yet I've never met a person who used the 'diminished marginal utility of income' argument who was willing to concede that. If you are, you'll be the first. In other words, arguing diminishing marginal utility's usually just a time-wasting distraction. While it sounds good, I suspect it's not the reason for your argument all.
erikpukinskis 15y ago
Do you ever receive packages from UPS? Do buy food from a grocery store? How do you think those things get paid for? You really think the $2 per pound you pay for tomatoes includes the true cost of growing a tomato and getting it into your car? If so, I've got a bridge you might be interested in...
- kiba 15y ago
  Some people are not grateful for the roads that government build, like critics of suburban development, enemies of car culture, etc.
  - thematt 15y ago
    Please stop promoting this nonsense that our current level of taxation is needed because of infrastructure needs. Transportation accounts for a measly 4% of the federal budget. Most of our tax dollars go towards military and paying for the old people in society, both of which are politically-charged budget items that politicians refuse to address. http://www.investorguide.com/taxtrackr/ http://www.investorguide.com/taxtrackr/
    - lurker19 15y ago
      Lowering taxes does not stop the military. Spending is one side, taxing is the other. Bills that run up must be paid, or war fought over them. The solution to overspending is to find a way to stop the spending. Regarding old people, as a group they worked pretty hard to build the modern world and its conveniences and efficiencies that we enjoy, so I don't mind paying them dividends.
- sunsu 15y ago
  Of course I've received a package from the bankrupt and insolvent USPS and yes I also buy food from grocery stores that receive food over roads badly in need of repair. I didn't say that the government does not do or provide ANY good things. However that does not mean that paying taxes to a government that IS inefficient and bloated can or should be called the "common good". The same government spent over a trillion dollars on wars in Iraq and Afghanistan. Are those wars part of the common good? The same government spends half a trillion on welfare of various sorts. Is that welfare part of the common good? The same government got us almost 15 trillion dollars in debt. Is that debt part of the common good? Different people may say yes to one, two, or all of the three things above. I, however, would say no to all of them. To me, paying taxes to the government is most definitely NOT the common good.

nhebb 15y ago

> US companies aren't spending because they don't want to spend. They aren't hiring because they are productive enough and are profitable enough without hiring. Companies spend more and hire more when it's necessary to meet additional demand. If there is no additional demand, then they don't. It's not because they don't want to spend or are content with existing profits, it's because consumer demand is currently very weak. With 40% of US mortgages underwater, it's going to take a while before consumer demand strengthens again.

TallTalesOrTrue 15y ago
And the consumer demand is very directly influenced by the job market. With so many people out of work. Many of us who do have jobs are cautious to not spend beyond our means. Its a vicious circle. Of course the goal of a public company to make money I can't blame these guys to hoarde all the money they can. Thats what their shareholders and directors demand.

deleted 15y ago

[deleted]

jeffdavis 15y ago

"Pay your taxes like the rest of us." They don't owe any taxes if they keep the money outside the country. People tend to think of taxes like "skimming" off the top, and like some kind of inevitable thing that doesn't affect your decisions. But that is the wrong way to think about it: when taxes are high enough to have a significant impact, they do affect taxpayer decisions. You seem to be saying that they should keep making decisions as if there were no taxes, and then pay high taxes because of those decisions. But that's completely unrealistic. When taxes are higher than a trivial amount, the correct way to think about them is as policy that will have lots of effects; some obvious and some not obvious.

rmrm 15y ago
Exactly, taxes act as incentives and de-incentives. Why do we have a health care system based on employer based insurance? Because employer based healthcare is tax deductible, and personal health care is not. What effect does the home mortgage interest deduction, and home sale capital income tax holiday have on the price of houses -- they result in higher housing prices because they provide incentive for more leverage and reaching for the highest appreciation. What is the result of the decision for us to tax personal income rather than personal consumption -- more consumption and less saving. What we tax and how we tax it has a very real impact on behavior around that thing. The long term effect of large amounts of cash overseas due to having a higher tax rate here is ultimately to build more operations overseas, to use it. That is how the incentive is set up. Not a fan of a tax holiday, but am a fan of reducing that incentive by bringing our corporate rates lower.
- lurker19 15y ago
  We have employer based health insurance in the US because insurance works on a group level, not individual level, when the risk being insured is not under the control of the consumer. We have employer-based health care, and transit subsidy, and meal subsidy, and all that crap, because of stupid tax laws, yes.

csmt 15y ago

Google and many other companies route their overseas earnings to Bermuda through Ireland and Holland, and effectively pay 2.4% tax on that money since Bermuda doesn't have any corporate taxes: http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-shows-how-60-billion-u-s-revenue-lost-to-tax-loopholes.html http://www.bloomberg.com/news/2010-10-21/google-2-4-rate-sho...