The New York Times reported last month that General Electric earned $14.2 billion in international profits, including, $5.1 billion in the United States. Yet GE did not pay a dime in federal income taxes last year. Oddly, President Obama chose GE Chairman and chief executive Jeffrey Immelt to head his President's Council on Jobs and Competitiveness.
According to the Associated Press, Immelt's compensation package doubled to $15.2 million last year, while this year, GE is seeking major concessions from the unions that represent its shrinking American workforce. That makes Immelt the wrong guy for the job of jobs czar.
Or as former Democratic Sen. Russ Feingold wrote, "Someone like Immelt, who has helped his company evade taxes on its huge profits -- and is now looking to workers to take major pay cuts after his compensation was doubled -- should not lead the administration's effort to create jobs."
After all, what kind of economic advice can Immelt give?
Probably advice like this:
(SET ITAL) Don't push for lower corporate tax rates. (END ITAL) Reformers want Washington to lower the U.S. corporate tax rate of 35 percent, so that America can compete with low-tax countries like Ireland and Singapore, where GE offshored significant profits. Immelt says corporate tax reform "deserves a healthy debate," but he knows the big money is in loopholes.
(SET ITAL) Hire an army of tax lawyers. (END ITAL) GE's tax department has 975 employees -- and make no mistake, they contribute to the economy.
(SET ITAL) Never stint on lobbyists. (END ITAL) In the last decade, GE spent more than $200 million on lobbyists, many of them tax-law specialists. Remember, the best way to play by the rules is to ghostwrite them.
(SET ITAL) If Washington wants to spend money, support the spending. (END ITAL) It doesn't matter if legislation involves economic stimulus, clean energy or health care -- if your operation is large enough, it will get a cut.
(SET ITAL) There are some things you can't outsource. (END ITAL) For example, CEOs, pet members of Congress and Washington lobbyists.
(SET ITAL) Donate to candidates from both parties. (END ITAL) Republicans talk up lower, simpler taxes, but it's just talk. Last year, Obama hectored what he calls the rich for "shirking" their duty to pay higher taxes. But Obamaland has sincere sympathy for those shirkers. Look at Obama's pick for Treasury Secretary, Timothy Geithner, who failed to pay $34,000 in Social Security and Medicare payments due on income earned while working for the International Monetary Fund.
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