Good news! If you're looking to avoid federal taxes on $14 billion in profits, the financial strategists at General Electric have a few tips.
Bad news! Unfortunately, and setting aside the small detail that you likely didn't earn $14 billion in 2010, if you're reading this, you're a real person, which means you're almost certainly ineligible. Ditto, incidentally, for most small businesses.
To paraphrase F. Scott Fitzgerald, "Let me tell you about the very rich [corporations]. They are different from you and me.'' Today's Times vividly demonstrates just how different they are when it comes to the modern political process.
According to the article, in 2010, General Electric had "worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States." Their 2010 American tax bill? Zero. And actually, the Times notes, GE's tax bill was much better than zero when factoring in a tax benefit of $3.2 billion.
To put a political influence gloss on this, GE's worldwide profits in 2010 amounted to 14 times the aggregate (and record-breaking) amount that Barack Obama and John McCain raised in contributions from actual, living and breathing, American human persons combined in 2008. Yet, to carry the comparison a bit further, it doesn't exactly involve going out on a limb to surmise that the combined tax burden of all of those actual, living, breathing American human people amounted to a whole lot more than zero. Or, if you prefer, more than negative $3.2 billion
Previously on this site, others, including Jason Linkins have explored the pragmatic consequences of the Supreme Court's 2010 decision in Citizens United v. FEC. This site has also featured some innovative ideas, including Dan Greenwood's, as to how to address Citizens United prospectively.
There are critical differences between corporations and real people, particularly when it comes to finding a balance as between the legal bitter and the legal sweet. As I wrote here a year ago, for starters, corporations don't go to jail; don't face execution; don't vote; do have eternal life; and are different from regular citizens in all sorts of meaningful ways, particularly when it comes to matters of political process.
Today's stunning revelations about General Electric, combined with the dramatic waxing of corporate political power post-Citizens United, turns taxation without representation on its head -- not once, but twice. Which is to say, we're heading for a democracy that is actually based neither on taxation without representation, nor on taxation with representation, but rather, on representation... without taxation.
It is the theory of pre-Revolutionary France: the first privilege of aristocracy is exemption from taxation.
There are many factors at play, of course, but at a minimum, left unaddressed, Citizens United will exacerbate those factors, resulting in a trend in which actual, living citizens of the world's greatest republic, will increasingly find themselves politically marginalized.
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