G.E., Doing The Fed’s Bidding By Not Paying Taxes?



G.E., Doing The Fed’s Bidding By NOT Paying Taxes?

by L. J. Martin

I’m going to try and be nice here, but it’s difficult when I hear the blubbering and blathering of imbeciles all around me…oops, I guess that’s not nice, but it is so very, very true.

How many times have you heard how terrible it was that G.E., a huge corporation, paid no income tax for the past year?

Now, how can that be so terrible when it’s exactly what the government wanted?  Of course they’d like it if G.E. had even more income and paid a lot of tax (and so would G.E.), but why didn’t they?

Well, number one was the fact they didn’t make the income they probably anticipated, thanks to the government screwing up the financial markets of the country and most the world, but number two was the fact they invested lots of money in equipment, research and development, and programs which carried heavy tax incentives.  Duh!  Who is it that develops the tax code in the U.S.?  Congress, that’s who.  So by doing exactly what Congress is trying to promote, investment in equipment, in labor, in green projects, they get criticized by the press and by members of Congress.  Okay, we all know that most reporters, talking heads, are sub-prime when it comes to gray matter, so that’s really not very surprising.  However, Congress?  Congress who writes the tax code?  With the help, of course, of many thousands of minions…but congress has to pass and approve it.

There again, I guess I’m jumping to conclusions, as to quote former house leader Nancy Pelosi, “we have to pass it to find out what’s in it.”  Probably the stupidest statement ever to come out of congress, or at least in the top 1% as there have been far too many stupid statements to keep track of.

Now, all that said, why G.E. has not defended themselves the obvious way, I’ll never understand.

The obvious way is to demonstrate how many taxes they paid in the last year.  Yes, they may have paid no corporate income tax as a result of doing exactly what the Fed wanted them to do, but paid no taxes?  That’s a major laugh.  G.E. paid millions and millons in taxes, if not hundreds and hundreds of millions.

You can’t do anything in America without paying tax.  If you buy a candy bar, even in a sales tax free state such as my own Montana, how much of the purchase price of that candy bar went to taxes.  Hershey paid a hell of a lot of taxes, in addition to the cost of labor and material, and that’s reflected in the PRICE of that candy bar.  If there were no taxes in America that candy bar would be back to the nickel it was when I put my nose prints on the candy store window, many, many years ago.

Do you think G.E. paid no employee tax? You can’t get away from employment tax no matter how much you reinvest in research and development and equipment. Do you think their employees paid no income tax on the money paid to them by G.E.?  Do you think G.E. paid real estate taxes?  Ditto for not hiding those. With hundreds of facilities, either owned or rented, they paid either directly or indirectly via their rent, real estate taxes.  No hiding those.  Do you think they bought natural gas and electricity to operate plant, equipment, and vehicles, and do you think there was tax on each of those items?  No hiding those taxes either.  How about inventory taxes, and on and on and on and on and on.

Now I’m no tax expert, although I made my living years ago designing tax shelters, as I’m not current on our very complicated tax law, now thicker than the Guttenberg Bible; but I do know that the only way you avoid income taxes is either by not making any money, or by reinvesting the money you do make into programs that Congress wants to stimulate via tax breaks.  Tax breaks come via depreciation of plant and equipment, via investment in research and development, or via tax credits, i.e. the direct investment of dollars you would have otherwise paid in tax into some program the Fed wants to see promoted, and about the only such programs out there are investments in some product to get us off dependency on foreign oil…solar, wind, geothermal, or other alternative energy programs.  G.E. is investing.

Again, G.E. avoided taxes by doing exactly what Congress wanted them to do, and became the whipping boy of the press and politicians, and liberal (and a few conservative) imbeciles in the process.

There are times when I begin to think you just can’t win in this political climate, then I have to remind myself that no matter how bad and unappreciative our system, it’s still the best in the world.

God bless America, even if she is peppered with imbeciles. And God bless great American companies like G.E.,  General Electric.

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