5 ms·
FedEx's CEO on McCain, free trade and the tax bias against capital-intensive industries.
- joubert 18y agoI will never use FedEx again.
- anthonyrubin 18y agoI apologize for the political content, but the article actually contains very little commentary on the election.
- newaccountname2 18y ago>We absolutely have to cut the corporate tax. Our current tax rate is about 38%. Even Germany has a 25% rate. This is so disingenuous; Germany also has a 19% VAT, and also has stronger regulations on industry. >If we had a lower corporate tax rate with the ability to expense capital expenditures, guess what? We'd buy more triple sevens. He wants to be able to write off the purchase of planes as expenses? What? They already get to write off depreciation on planes, but you can't write off the whole plane because you can sell the damn thing after you buy it.
- vaksel 18y agoyeah regulation in europe is insane. You fire someone in Europe you have to continue paying their full salary for a whole year or until they get a new job. Here its wham bam thank you mam, don't forget your box and enjoy living on $1500 a month that you get from unemployment.
- vaksel 18y agohere is the reference http://www.economist.com/research/articlesBySubject/displaystory.cfm?subjectid=7933596&story_id=12209771 http://www.economist.com/research/articlesBySubject/displays... if links doesn't work the main pic: http://media.economist.com/images/na/2008w39/Sacking.jpg http://media.economist.com/images/na/2008w39/Sacking.jpg WTF with all the downvoting? First it was +5 now its 0. If you don't believe the post...google to find out if its true or not
- ovi256 18y agoI downvoted you because I know you (and the Economist) are wrong. I'm in Paris, and I've seen downsizing at a startup. They've fired dozens of people with a week's notice, and 2 or 3 months severance pay, AS PER their contracts. It's NOT THE LAW that imposes this (the law imposes nil severance), but the contracts - they had this clause. Furthermore, severance pay is only due for termination that is outside the employee's control. That is, if the employer downsizes. If you don't come to work or hit you boss, you can be fired INSTANTLY with NO severence pay - like anywhere in the world. This is rare however, I've seen it only once for supposedly sub-par performance.
- DanielBMarkham 18y agoVery interesting. We always hear of standard benefits for workers in France, like extended yearly vacation time. How does that work? Is it possible that by working for a startup under a contract that your experience is different than the rest of your countrymen? Just trying to figure out the discrepancies.
- davidw 18y agoMany European countries have tried to introduce different ways of being 'flexible'. Often there is a cutoff for company size, the age of the employee, that kind of thing. A small company may have less requirements in terms of hiring/firing. Also, in recent years, various countries have attempted to introduce different types of contracts. By way of example, Italy has 'standard' contracts, which are the 'real difficult to fire' kind, and the new flexible sort, which are meant to be used for more flexible positions. What has happened in practice is that newer workers, wherever possible, are hired up with the flexible contracts, which generally offer nothing in the way of severance pay or anything - less than you'd get in the US in most 'good' jobs. Older workers are hired with the standard contracts. This creates a two-tier system with lots of unhealthy side effects. I have no idea how the details work out in France.
- DanielBMarkham 18y ago
- davidw 18y agoThe reason I hate seeing politics here is that it's usually not up to the usual standards of discourse about hacking and startups. To use your post as an example, in a few brief lines, you sum up something where there is a glimmer of truth, but there is so much more to be said on the subject that what you have written is basically inaccurate. There are, in reality, three broad models in 'Europe'. The 'southern' model: Spain, and Italy (which I know quite well) don't give you a lot of government unemployment benefits, but it's very difficult to fire someone. France and Germany give you lots of benefits if you're fired, and it's also difficult. In Denmark, it's easier to fire people, but the obligation to care for fired employees is viewed as a collective one, payed for with taxes, rather than a burden that falls exclusively on the employer in question.
- davidw 18y agoActually, that's just one reason. Other problems include: * Attracting people who care more about talking about politics than other things, which creates a negative feedback loop. * 'Pack' voting down of whoever is currently unpopular with the current groupthink. This is reinforced by the people above.
- maurycy 18y agoIn what country you have to continue paying full salary of a fired employee?
- jwilliams 18y agoSwitzerland is one example - it's not full salary, and there are some caps - but they are both very high (I think something like 80% and 200k respectively - it's been a while since I lived there). Sweden is another example, but I don't know the specifics. They do offer things like paid 18 months parental leave (yeap, both maternal and paternal).
- netcan 18y agoreference?
- cperciva 18y agoGermany also has a 19% VAT Companies don't pay VAT -- people do.
- anamax 18y ago> He wants to be able to write off the purchase of planes as expenses? What? They already get to write off depreciation on planes, Expenses are now, depreciation is later. And, if you get one, you don't get the other. I don't know how all the numbers work out, but it could easily be that the tax code encourages borrowing by corporations for things subject to significant depreciation terms. (Interest paid is an expense.) > but you can't write off the whole plane because you can sell the damn thing after you buy it. You just record such a sale against expenses, that is, "net everything". I do think that expenses should be tied to cash expenditures. So, if a company borrows to buy something, it should only be able to expense what it actually paid in any given year. Such treatment would make all expenditures "equal" in some sense.
- joubert 18y agoNo, there is a distinction between cash flows, and income & expenses. An income or an expense does not require a cash flow, and a cash flow is not necessarily an income or an expense. Expenses should not be tied to cash layouts, because: (a) purchases are not necessarily expenses, but may be the buying of income-generating assets (i.e. expense is allocated over the life of the asset in the form of depreciation). (b) You can have an expense without laying out cash (e.g. an asset loses value such as a debtor defaulting).
- Prrometheus 18y agoThat's pretty much the case against Barack Obama: Trade (BIG BIG BIG win for McCain), Taxes (small win for McCain), Subsidies (big win for McCain), Healthcare (big win for McCain: got to address cost, not access), and Energy (slight win for McCain). Barack on the other hand is better on avoiding World War III, Big Brother, and Theocracy. It's a depressing choice.
- mattmaroon 18y agoMost economists disagree with your assertions.
- mattmaroon 18y agoFor proof of that btw: http://www.cnn.com/2008/POLITICS/09/16/dilbert.economy/index.html http://www.cnn.com/2008/POLITICS/09/16/dilbert.economy/index... http://www.economist.com/world/unitedstates/displaystory.cfm?STORY_ID=12342127 http://www.economist.com/world/unitedstates/displaystory.cfm... "Even among Republican [economist]s Mr Obama has the edge: 46% versus 23% say Mr Obama has the better grasp of the subject
- Prrometheus 18y agoIt is my unsupported opinion that economists have Bush fatigue just like everybody else, and are eager to see the regime of permanent deficits and trillion dollar wars out on the streets. Obama does appear at times to be thoughtful, and his advisors are centrists. I think economists are hoping for a second Clinton, which would certainly be better than a third Bush. I hope they are right. It is my unsupported opinion given my anecdotal interactions with people that the following quote is the explaining factor of The Economist piece: 'Either way, according to the economists, it would be difficult to do much worse than George Bush. The respondents give Mr Bush a dismal average of 1.7 on our five-point scale for his economic management. Eighty-two per cent thought Mr Bush’s record was bad or very bad; only 1% thought it was very good. The Democrats were overwhelmingly negative, but nearly every respondent viewed Mr Bush’s record unfavourably. Half of Republican respondents thought Mr Bush deserves only a 2. “The minimum rating of one severely overestimates the quality of Bush’s economic policies,” says one non-aligned economist.' On that, I whole-heartedly agree with them.
- logjam 18y agoI did consulting work for FedEx. Instead of asking America to bail him out like we've bailed out banks, Fred might want to look at his company. I've never actually encountered a more inbred group of incompetents. They, like Microsoft, happened to become lottery winners....and like Microsoft, they will watch themselves slowly lose to more agile organizations. He (and McCain) are completely backwards looking.
- Prrometheus 18y agoHe's not asking the government to "bail him out". He's asking them to get out of his way.
- comatose_kid 18y agoright - exactly what do you think he's doing by asking for a write off on a fleet of 777s?
- Prrometheus 18y agoMatch his tax bills more closely to his cash expenditures?
- comatose_kid 18y agoJust like the write off consumers receive when they buy goods, right?
- deleted 18y ago[deleted]
- deleted 18y ago[deleted]
- Prrometheus 18y agoAre you suggesting that companies should pay tax on their revenue, and not their earnings?