May 23, 2013
Apple's latest product isn't disruptive to the music industry, cell phones or television. It's aimed at the United States of America.
<p>Congressional investigators <a href="http://www.nytimes.com/2013/05/21/business/apple-avoided-billions-in-taxes-congressional-panel-says.html?pagewanted=all" target="_hplink">found</a> Apple uses the most innovative accounting gimmicks in the world to stiff the US Treasury of some $64 billion. While Apple claims to be the nation's biggest taxpayer in America, it's also among the nation's biggest tax avoiders.</p><p>Apple's tax scheme amounts to a high stakes three-card monte game, as Steve Jobs' corporate heirs manipulate shell companies to <a href="http://www.slate.com/blogs/weigel/2013/05/20/read_the_senate_report_on_how_apple_used_shell_companies_to_save_44_billion.html" target="_hplink">hide billions in profits</a> from national authorities.</p><p>Shell companies are nothing new and by no means an Apple innovation -- Enron used plenty of them to wreak its special brand of havoc.</p><p>Apple's innovation is to create a corporate entity that is stateless -- it resides nowhere at the same time it is everywhere. Thus, Apple Operations International is able to file no tax return anywhere, though it is incorporated in Ireland and holds board meetings in California.</p><p>This is not a victimless crime, if you will, the <em>New York Times</em> <a href="http://www.nytimes.com/2013/05/21/business/apple-avoided-billions-in-taxes-congressional-panel-says.html?pagewanted=all" target="_hplink">reports</a>.</p><blockquote>Because of these strategies, tax experts say, Washington is forced to rely more and heavily on payroll taxes and individual income taxes to finance the government's operations. For example, in 2011, individual income taxes contributed $1.1 trillion to federal coffers, while corporate taxes added up to $181 billion.</blockquote><p>In plain English, working stiffs, folks like Steve Jobs' (adoptive) father, a car mechanic and cabinetmaker, pay more so Apple can sit on a crock of gold.</p><p>Of course, this is of a piece with the corporate philosophy famously summed up by an <a href="http://www.nytimes.com/2012/01/22/business/apple-america-and-a-squeezed-middle-class.html?pagewanted=2" target="_hplink">anonymous Apple executive</a>:</p><blockquote>"We don't have an obligation to solve America's problems."</blockquote><p>The inconvenient truth, forgotten at corporate headquarters, is there would be no Apple if not for the United States and, not to put too fine a point on it, the United States Treasury.</p><p>Defense spending created the Silicon Valley where Jobs literally cut his teeth. The Pentagon's buy American requirement (since gutted) bankrolled the American electronics and cybernetics industries where the young Jobs worked, and it stocked the surplus stores Jobs and Woz raided to build their first Apple prototypes. Government R&D funded the invention of microchips, the Internet and other foundation technologies Apple has profited from so lucratively.</p><p>And now it says it owes America nothing.</p><p>This is sociopathic behavior.</p><p>A child that acts this way toward the parents that fed and raised him is called ungrateful -- at best.</p><p>Make no mistake: Apple is not alone in its behavior.</p><p>Throughout the tech industry, engineers who helped build a company are told to train the lower-paid foreign workers who will replace them.</p><p>Banks turn their backs on the taxpayers that bailed them out and refuse loans to their longtime customers in small business.</p><p>Across America, workers who dedicate the best years of their lives to build industrial enterprises are thrown to the gutter as their workplaces are shuttered, moved to Vietnam, Bangladesh or some other human hellhole.</p><p>While we talk about reforming the tax code and the closing loopholes in this law and that, let's be honest about what's at play:</p><p>A corporate psychology that refuses to acknowledge the existence of the society in which it operates.</p><p>It is a species of pathological individualism that does not have the words "virtue," "decency" or "community" in its <a href="http://www.nytimes.com/2013/05/21/opinion/brooks-what-our-words-tell-us.html?partner=rssnyt&emc=rss" target="_hplink">vocabulary</a>.</p><p>If you're looking for poisoned fruits of the "Me Generation," don't go to Haight Street -- go to Wall Street and corporate suites.</p>
Keep reading... Show less