Outrageous: David Cay Johnston Explains How Big Corporations Withhold Your Taxes and Then Pocket Them
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DCJ: Let me give you a real killer number here. If you can get a law passed to collect a penny a day from everybody in America -- and I show how one industry did this, the pipeline industry got themselves exempted from the corporate income tax, but they still get to collect it in their monopoly rates – if you can get a penny a day from everybody in America, at the end of the year you’ll have over a billion dollars.
What this is about is very simple. If you can get the rules rewritten in your favor... that means you can raise prices, you can refuse service wherever it’s not profitable. You could refuse services as long as you don’t say, “I don’t want to serve you because you’re a lesbian,” or, “You belong to the wrong religion,” you can refuse service.
You know, Americans had be sold on this notion that we are number one in the world. But by some measures, our healthcare system is behind Cuba. We pay almost the highest prices in the world for our Internet. If you buy a triple-play package from one of the American cable or telephone companies – Internet, cable TV and telephone -- on average, you pay $160 a month with taxes. If you go to France, the same package is $40 to $70. There are some variations, but the range is $40 to $70. By the way, here you get one foreign country to call for free. There you get 70. Here you get American television. There you get worldwide television. Here you get an Internet that’s the equivalent of a two-lane Irish road, where you have to stop and wait every now and then, because the sheep are on the path. There you get an information superhighway.
We are now 29th in the world in the speed of our Internet. We are behind Bulgaria, of all places.
We are falling behind left and right. We have a Congress that just cut money for scientific research. We’ve got people who are idiots. I mean that word very clearly, “idiots,” like Sarah Palin going around saying, “Why are we paying for fruit fly research?” Anybody who understands science knows that massive advancements in human knowledge – knowledge that has saved lives -- has come from studying fruit flies. If you’re an idiot like Sarah Palin, if you’re Donald Trump, if you’re Senator Cruz from Texas, then you don’t get it.
We really have to get a society that’s based on science and knowledge, that has an economic system that’s based on competitive markets with protections for consumers. While the rest of the world’s going to run right by us, we’re falling behind!
JH: David, you detailed very, very well how we are constantly being ripped off. It’s a death of 1,000 cuts. Why is that? The story that we’ve gotten, for years and years and years, is that we have less regulation in order to spur competition. Ultimately, that competition was supposed to benefit consumers. What’s going wrong?
DCJ: I want more competition. Here’s what really goes on, however. We put up barriers to competition, and in fact, Wall Street has institutionalized this concept. Morningstar, they’re a big financial advice firm. They tell people that they should grade companies and decide whether to buy their stock, based on something called a “moat index.” Moat, like around a castle? A moat index asks, “What barriers has the government erected to keep anybody else from competing against that company?” Indeed, as I show in my book, you could get rich if you invest in those companies that have regulatory moats -- where under the name of deregulation, we have insulated them from the rigors of the market.