Tuesday, May 21, 2013

Idiots on Parade

Apple CEO, Tim Cook will be hauled in front of cameras today in Washington DC to answer accusations that he and his company have ruthlessly taken advantage of loopholes in the tax laws of both the United States and Ireland, and paid no corporate income taxes on over 74 billion in profit over the past four years.
Something hilariously called the “U.S. Senate’s Permanent Subcommittee on Investigations” will publish the findings of their lengthy study into Apple’s tax avoidance strategies in a hearing chaired by two fossils, D- Carl Levin and R-John McCain, making this a bi-partisan circus.

OK, So Apple Inc, a company that makes products that make our lives more efficient and fun, a company that has created over 80,000 permanent jobs worldwide, a company that in 2012 earned 156 billion in profit will be accused of breaking zero laws. That's right, the fine folks on the USPSI will declare that in cleverly avoiding the payment of the 35% corporate tax rate on 74 billion over four years, Apple not only broke no US tax laws, but also broke no Irish laws. In other words, Apple is guilty of doing what any person or company in their right mind does, minimize, or in this case eliminate taxes in every legal way possible.

But Doug, you say, isn't it Apple's duty to pay their fair share in taxes? No. It is Apple's "duty" to make great, world class products, providing value to it's customers and shareholders. In doing so, it has completely fulfilled the purpose and reason for its very existence. Is it Apple's fault that our tax system was written by idiots? Is it Apple's fault that said tax code is 74,000 pages long? Listen, if our politicians are stupid enough to create a system that says that if you create a foreign subsidiary and earn money overseas, you don't have to pay taxes on that profit until you bring that money back into the country, they shouldn't be shocked to discover American companies taking them up on their offer!

What I would like to see at today's hearing would be Tim Cook sitting behind the Senator's panel, and Senators McCain and Levin being called as witnesses. First question would be something like this:

Cook: Senators, could you tell me why you wrote the tax law in such a way that makes it easy for me to move profits overseas to avoid them? Oh, and as a follow up, if you guys ran Apple, would you have just forked over the 25 billion in taxes that we avoided by moving that office to Ireland? And if you did, how would you explain that decision to our shareholders?