Thursday, March 31, 2011

We Pay taxes. Big Corporate Skates.

You did not find this information in the Journal. It was in most responsible national papers on Friday and 60 Minutes on Sunday. The NYT broke the story and is running a series on how few taxes Big Corporate actually pay, but no series is in our Journal. The Journal does, however, try to keep us up on Charlie Sheen.

While huge corporations continue to scream about high U.S. Taxes, 60% of big U.S. corporations paid NO (none) taxes to the U.S. in 2005 (the last year we have this kind of data), and, according to 60 minutes and the network news, the number is growing rapidly.

I don't know about you, but this is a major untold story. My federal taxes are always in the 10%-20% range, and you can bet that local Albuquerque businesses are getting stuck for 20% to 35% while Big Corporate skates.

A fascinating NYT story is below:

General Electric, the nation’s largest corporation, had a very good year in 2010.

By DAVID KOCIENIEWSKI Published: March 24, 2011

The company reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.
Its American tax bill? None! (Same with Exxon) In fact, G.E. claimed a tax benefit of $3.2 billion.

That may be hard to fathom for the millions of American business owners and households now preparing their own returns, but low taxes are nothing new for G.E. The company has been cutting the percentage of its American profits paid to the Internal Revenue Service for years, resulting in a far lower rate than at most multinational companies.

Its extraordinary success is based on an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore. G.E.’s giant tax department, led by a bow-tied former Treasury official named John Samuels, is often referred to as the world’s best tax law firm. Indeed, the company’s slogan “Imagination at Work” fits this department well. The team includes former officials not just from the Treasury, but also from the I.R.S. and virtually all the tax-writing committees in Congress.

While General Electric is one of the most skilled at reducing its tax burden, many other companies have become better at this as well. Although the top corporate tax rate in the United States is 35 percent, one of the highest in the world, companies have been increasingly using a maze of shelters, tax credits and subsidies to pay far less.

The rest of the story is here.

Saturday, March 19, 2011

Who's Afraid of Reforming Wall Street? The Journal!

You will not find an article like this in the Albuquerque Journal. From this week's TIME:

By Joe Klein Thursday, Mar. 03, 2011

"Three years after a horrific financial crisis caused by massive fraud, not a single financial executive has gone to jail," said Charles Ferguson, accepting a well-deserved Oscar for Inside Job, his documentary about the great Wall Street heist. "And that's wrong." Of course it is — but that shouldn't be a surprise. To put bad guys in jail, you need police and prosecutors. The financial police we have, agencies like the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), have been laughably inept in the era of financial deregulation. The SEC wasn't even able to spot the broad-daylight highway robbery committed by Bernard Madoff. And so, in 2010, the Obama Administration nudged through Congress the Dodd-Frank financial-reform bill, which was designed to put real cops, with real regulatory heft, on the financial beat. And now, in 2011, the Republican House seems intent on quietly gutting the bill under the sordid camouflage of budget cutting. "They're defunding the police after we had the biggest bout of looting in history," an Administration official told me. "That's just crazy."

Let's review the outrage: the heart of the financial collapse was a fraudulent effort to sell home mortgages to people who couldn't afford them. Some of these mortgages were truly mind-boggling — no money down (but a hefty interest rate hidden in the thicket of contractual codicils), no documentation (like proof of job and salary). The mortgages were then thrown together into giant, opaque bond packages and sold again as solid investments. (The ratings agencies, Moody's and Standard & Poor's, were essentially unindicted co-conspirators in the scam.) And those packages were then sliced up, resold and transformed into exotic derivatives, which were bet on by bond traders and investors. (See "The Demise of Bernie Madoff.")

Confused? Well, that was the point. According to Michael Lewis, whose book The Big Short is a riveting encyclopedia of the disaster, even the SEC was confused by the actual contents of the most far-fetched packages, called collateralized debt obligations (CDOs). Wall Street spewed terms like collateralized debt obligation in order to mislead: a more accurate abbreviation might have been RCLs —repackaged crappy loans. When the crappy loans couldn't be repaid, the housing market, Wall Street and the American economy imploded. The Wall Street traders pocketed hundreds of millions in profits; the American taxpayer, and homeowner, picked up the losses.

Read more here.

Remember, the Albuquerque Journal enjoys a near monopoly in this state. It should be held to a high standard, so if you have your own Untold Stories, send them to me. If you think this type of e-mail is a good idea, forward it to others, so they can request to be added the Untold Stories list.

Yours in media education,

Bob McCannon

Friday, March 4, 2011

Journal Ignores Petraeus' Apology for U.S. Atrocity

The story below was not on the Journal's front page–in fact not in the paper at all! Published by every major newspaper, most minor ones and national network news yesterday and the day before, it was not in the Albuquerque Journal, which did, however, publish stories about Charlie Sheen both days.

As a general rule the Journal ignores stories about our two wars that have destroyed countless lives and over four trillion dollars (source: Nobel Prize-winning economist Joseph Stiglitz). (source: Nobel Prize-winning economist Joseph Stiglitz).

Below are two stories about this event–one conservative, one liberal.

For a long list of such omissions, go to:

Coalition Apologizes for Deaths of Afghan Children (Wall Street Journal - March 3, 2011)

U.S. Gen. David Petraeus, the coalition's commander in Afghanistan, issued a rare apology Wednesday for a helicopter strike that killed nine children, hours after Afghan President Hamid Karzai condemned the allies for launching what he called a "ruthless attack."
[Rest of story here:]

Nine Afghan Boys Collecting Firewood Killed by NATO Helicopters (New York Times - March 2, 2011)

The NATO statement, which included an unusual personal apology by the commander of the NATO forces in Afghanistan, Gen. David H. Petraeus, said the boys had been misidentified as the attackers of a NATO base earlier in the day. News of the attack enraged Afghans and led to an anti-American demonstration on Wednesday in the village of Nanglam, where the boys were from. The only survivor, Hemad, 11, said his mother had told him to go out with other boys to collect firewood because “the weather is very cold now.”

[Rest of story here:]

Monday, February 28, 2011

Journal Ignores Afghanistan

The Albuquerque Journal continues to ignore the longest war in U.S. history with only a few small paragraphs last week. During this week, 100 Afghans and many of our young men/NATO soldiers were killed and wounded. We are spending $14 Million per hour in Afghanistan

As Congress argues about how to save $50-100 billion in the next year, we have spent trillions (no exaggeration) in Iraq and Afghanistan, even though most independent experts agree that the latter war is not winnable, and the former was a mistake.

The Journal has a responsibility to educate the public about the challenges, tenor and progress of this expensive conflict. This information is more important that a San Francisco snowstorm (Sunday's Journal) or Bristol Palin on Dancing with the Stars (a former front page lead story)? This interminable should be regular front page news.

Below you will find 12 articles from just the last few days. They are drawn from a variety of solid sources, including some reputable newspapers and the Associated Press (the Journal's main source).

Remember, the Albuquerque Journal enjoys a near monopoly in this state. It should be held to a high standard, so if you have your own Untold Stories, please e-mail them to me. If you think this e-mail is a good idea, forward it to others, so they can request to be added the Untold Stories list.

Yours in media education,

Bob McCannon

More US-led troops killed in Afghan war

An 8-year war built on lies: But when did the lying begin?

Afghanistan civilian casualties spike; officials say 200 killed in 2-week period

Bomb kills nine civilians in Afghanistan

Bomber kills at least 4 in northwest Afghanistan

Taliban Scrambles to Stem Bad Publicity After Civilian 'Massacres'

Three rockets fired into heart of Kabul

Low pay, big risks for fuel haulers in Afghan war

Canadian mentors walk a delicate path in training Afghan soldiers

Gates: Warning Against Wars Like Iraq and Afghanistan

US Reduces Troops in Afghan Valley

Afghanistan says 50 civilians killed in Western battle with insurgents

Bob McCannon

Presenter, Media Educator, Consultant,

President: The Action Coalition for Media Education

American Academy of Pediatrics' Media Educator of the Year

Author, college and secondary texts

Monday, March 23, 2009

SunCal TIDDs Bill Fails

After passing the Senate, the SunCal TIDDs bill stalled in the House 33-33, save the taxpayers 408 million dollars. Here is a great comment from this blog:

Anonymous said...
Corporate Welfare,
shame on Linda Lopez and Sen. Bernadette sanchez for proposing this during these difficult finacial times. 4000 acre development. this works out to over $100,000 per acre. ARE YOU KIDDING. GIVE THIS MONEY TO THE PEOPLE. What happened to the ethics reform bill, oops , they must have been too busy working on how to sneak this by us common folks!

March 22, 2009 12:00 AM

More TIDDs Info You Won't Find in the J

Another Response to my TIDDs story with comments(**) from a TIDDs expert:

SunCal will get the TIDD money whether they provide a single job or
not.  There is nothing in the state law which requires that they
actually come through on their promises.
**The bonds can't be sold until there is sufficient GRT and property tax revenues generated within the TIDD to back the bonds ........ so SunCal doesn't have to create new jobs, but if they don't bring in jobs there will be no GRT......and no bonds.

That makes the TIDDs a pure giveaway - money for nothing.  It ought
to be illegal.  If they were contracts, they would have people going to
jail, even in New Mexico.
**I don't agree with this statement, but I understand what motivates the sentiment.

Once the Bonding is approved, it cannot be disapproved in the
future.  Once and over - it's a done deal.
**I'm researching this point ..... everyone I have spoken with concurs with this statement.  It concerns me very much.

TIDDs are funding for infrastructure - roads, sidewalks, parks,
flood control, stuff like that.  Nothing to do with jobs - nothing. 
But the money is a direct subsidy to the developer - it significantly
cuts his cost of doing business, so his profits go up by that amount. 
Wonder why SunCal is will ing to pay hundreds of thousands of dollars
to get the TIDD passed?  They will make hundreds of millions in pure
profit when the funds roll in.
**TIDDs are pure profit for SunCal .... I agree.  Normally, the developer is required to construct the roads, sewer, and water, etc. with his own $$.  In the case of TIDDs, he still must use his own $$ upfront, but then he is repaid in the future when the TIDD bonds are issued.  So it cushions his bottom line --- his profit.  It also shifts the risk from the private sector to the public sector.

They say they don't get paid until they do what they promise.  In
real life, that means they promise to build a road and some flood
control, and they get paid for it.  Bringing jobs is NOT in that
equation.  It's all about infrastructure.

**This is true to a point.  If there are no jobs ....there is no GRT.  If there is no GRT (and property tax), there will be no bonds.   So he must generate jobs.  The real issue ... will he simply entice existing jobs away from another part of the city or state to his development.   I think the cannibalization issue a serious one.  

If TIDDs bring jobs from outside the state, why did the State
provide incentives of $132M to Schott Solar and $47M to Fidelity to
move into Mesa del Sol?  MdS has huge TIDDs - no pun intended - why
didn't their magic suffice to bring in those outfits?  In fact, what
effect did their TIDDs have, at all, in bringing these companies to

Giving up the taxes doesn't matter?  The development will be built
out in a few years, but for at least 30 years, the City and/or County
must provide ALL of the services, operations, maintenance, and anything
else that a big development like that would require.  But they have to
do it with only their remaining part of the Tax revenue - 25% to 50%. 
They can't do it.  Somehow current planning seems to ignore this point,
but it's very real - there is going to be a real awakening when things
start to get built.

Or, if it turns out that this portion of the tax revenues is enough
- then taxes should be cut big time!  You just can't win.

Journal Misses TIDDs Import

The good news is that the TIDDS bill has been temporarily pulled from the house due to rising public outcry. Of course, the Journal softpedaled this story. The bad news is that TIDDs will be back! It's a complex issue, so I have assembled more information.

Now is the time to email your legislators to prevent 400 million of your tax dollars being given to a CA company that already has many documented bankrupt developments. Here are some talking points (from a legislator) and a list of House email addresses.

Our local guy is Moe Maestas who is pro TIDDS (and, according to today's paper, sponsoring a bill to wipe away criminals' past crimes, making more business for criminal attorneys. Guess what he does for a living?)

From a legislator:

• TIDDs are a giveaway to the Developers.  They fund roads and sidewalks, and only increase the developer's profits.  They have nothing whatever to do with bringing jobs into the state.
• TIDDs take away the tax base the Cities and Counties need to provide services to the new developments, and take State funds needed for Capital Outlay, Education, and Aid to Children.
• TIDDs take tax revenues to benefit large developers at the expense of the whole state.
• If you approve these big TIDDs, you guarantee the developers hundreds of millions of dollars in subsidy, but the state law requires absolutely nothing in return from the developers.  They plan jobs, they promise jobs, but if they don't produce any, there is NO PENALTY.  You should not DARE to vote yes for these giveaways.
• TIDD funding encourages new, sprawling developments.  These developments will cannibalize jobs and business from other places in the area and the region.  This means TIDD subsidies are helping create rich new areas at the expense of existing areas.  The state should not, ever, subsidize this activity.
• If TIDDs have power to bring new jobs to NM, why did the State have to put in $130M to bring Schott Solar and $47M to bring Fidelity Investments to Mesa del Sol, which already has a huge TIDD?  Wasn't the "Job Magic" of their TIDD enough to bring in these companies?  Just what DID their TIDD contribute to bringing these businesses here?