Just about a year ago the NY Times ran a story about how GE deals with its taxes - very similar to the one they published last weekend about Apple. According to its quarterly report, GE's first quarter earnings for 2012 were $3.03 billion on revenues of $35.2 billion. GE didn't pay any federal corporate taxes last year and it would not surprise me if they paid about the same amount this year.
GE employs 287,000 people worldwide. I couldn't find a number for U.S. employment. But each of those people pays taxes and each of the shareholders, like Apple investors, pays taxes on their dividends and on any profits on sale of GE stock.
All raising taxes on corporations will accomplish would be to make more companies move more operations out of the U.S. Don't believe me?
Let's go back to the Times piece on Apple which begins with an explanation of its dateline: Reno, Nevada.
"With a handful of employees in a small office here in Reno, Apple has done something central to its corporate strategy: it has avoided millions of dollars in taxes in California and 20 other states."
California, you see, has a corporate tax rate of 8.84 percent. Nevada's corporate tax rate is … zero.
Let's assume you had the power to make major, successful corporations pay more taxes and you used that power.
How many jobs would GE or Apple paying higher taxes create? How many more students would go to college? How many more houses would be bought? How much would gasoline prices go down?
Nada, would be my guess.
If anything, jobs (and the income that goes with them) would move according to the rules of a Double Irish With a Dutch Sandwich.
None of which includes the United States.