Standing Up to Apple

Posted on Sep 4, 2016

By Robert Reich / RobertReich.org

For years, Washington lawmakers on both sides of the aisle have attacked big corporations for avoiding taxes by parking their profits overseas. Last week the European Union did something about it.

The European Union’s executive commission ordered Ireland to collect $14.5 billion in back taxes from Apple.

But rather than congratulate Europe for standing up to Apple, official Washington is outraged.

Republican House Speaker Paul Ryan calls it an “awful” decision. Democratic Senator Charles Schumer, who’s likely to become Senate Majority Leader next year, says it’s  “a cheap money grab by the European Commission.” Republican Orrin Hatch, chairman of the Senate Finance Committee, accuses Europe of “targeting” American businesses. Democratic Senator Ron Wyden says it “undermines our tax treaties and paints a target on American firms in the eyes of foreign governments.”

P-l-e-a-s-e.

These are taxes America should have required Apple to pay to the U.S. Treasury. But we didn’t – because of Ryan, Schumer, Hatch, Wyden, and other inhabitants of Capitol Hill haven’t been able to agree on how to close the loophole that has allowed Apple, and many other global American corporations, to avoid paying the corporate income taxes they owe.

Let’s be clear. The products Apple sells abroad are designed and developed in the United States. So the foreign royalties Apple collects on them logically should be treated as corporate income to Apple here in America.

But Apple and other Big Tech corporations like Google and Amazon – along with much of Big Pharma, and even Starbucks – have avoided paying hundreds of billions of dollars in taxes on their worldwide earnings because they don’t really sell things like cars or refrigerators or television sets that they make here and ship abroad.

Their major assets are designs, software, and patented ideas.

Although most of this intellectual capital originates here, it can be transferred instantly around the world – finding its way into a vast array of products and services abroad.

Intellectual capital is hard to see, measure, value, and track. So it’s a perfect vehicle for tax avoidance.

Apple transfers its intellectual capital to an Apple subsidiary in Ireland, which then “sells” Apple products all over Europe. And it keeps most of the money there. Ireland has been more than happy to oblige by imposing on Apple a tax rate that’s laughably low – 0.005 percent in 2014, for example.

Apple is America’s most profitable high-tech company and also one of America’s biggest tax cheats. It maintains a worldwide network of tax havens to park its global profits, some of which don’t even have any employees.

Sitting atop this network is “Apple Operations International,” incorporated in Ireland. Never mind that Apple Operations International keeps its bank accounts and records in the United States and holds board meetings in California. It’s still considered Irish. And its main job is allocating Apple’s earnings among its international subsidiaries in order to keep taxes as low as possible.

As a result, over last decade alone Apple has amassed a stunning $231.5 billion cash pile abroad, subjected to little or no taxes.

This hasn’t stopped Apple from richly rewarding its American shareholders with fat dividends and stock buybacks that raise share prices. But rather than use its overseas cash to fund these, Apple has taken on billions of dollars of additional debt.

It’s a scam, at the expense of American taxpayers.

Add in the worldwide sales of America’s Big Tech, Big Pharma, and Big Franchise operations, and the scam is sizeable. Over 2 trillion dollars of U.S. corporate profits are now parked abroad – all of it escaping the U.S. corporate income tax.

To make up the difference, you and I and millions of other Americans have to pay more in income taxes and payroll taxes to finance the U.S. government.

Why can’t this loophole be closed? In fact, what’s stopping the Internal Revenue Service from doing what the European Commission just did – telling Apple it owes tens of billions of dollars, but to America rather than to Ireland?

The dirty little secret is the loophole could be closed, and the IRS could probably do what Europe just did even under existing law. But neither will happen because Big Tech, Big Pharma, and Big Franchise have enough political clout to stop them from happening.

Ironically, the European Commission’s ruling is having the opposite effect in the United States. It’s adding fuel to the demand Apple and other giant U.S. global corporations have been making, that the United States slash taxes on corporations that move their overseas earnings back to the United States.

In other words, they want another tax amnesty.

Congress’s last tax amnesty occurred in 2004, when global U.S. corporations brought back about $300 billion from overseas, and paid just a tax rate of 5.25 percent rather than the regular 35 percent U.S. corporate rate.

Corporate executives argued then – as they argue now – that the amnesty would allow them to reinvest those earnings in America.

The argument was baloney then and it’s baloney now. A study by the National Bureau of Economic Research found that 92 percent of the repatriated cash was used to pay for dividends, share buybacks or executive bonuses.

“Repatriations did not lead to an increase in domestic investment, employment or R.&D., even for the firms that lobbied for the tax holiday stating these intentions,” the studyconcluded.

The political establishment in Washington is preparing for another tax amnesty nonetheless. In a white paper published last week, the Treasury Department warned that an American corporation like Apple, ordered by the European Commission to make tax repayments, might eventually use such payments to offset its U.S. tax bill “when its offshore earnings are repatriated or treated as repatriated as part of possible U.S. tax reform.”

Rather than another tax amnesty, we need a crackdown on corporate tax avoidance.

Instead of criticizing the European Commission for forcing Apple to pay up, American politicians ought to be thanking Europe for standing up to Apple.

At least someone has.

http://www.truthdig.com/report/item/standing_up_to_apple_20160904

The DNC Is One Big Corporate Bribe

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Drink up—it’s on us! Then go protest the TPP to your heart’s content.

To get to the Democratic National Convention, you take the subway to the AT&T Station and walk to the Wells Fargo Center. Along the way, you’ll stroll by the Comcast Xfinity Live complex, where delegates and honored guests can booze it up. You’ll also see the “Cars Move America” exhibit, an actual showroom sponsored by Ford, GM, Toyota, and others. Finally, you’ll reach your seat and watch Democrats explain why we have to reduce the power of big corporations in America.

Party conventions have always been collection points for big money. But many major corporations sat out last week’s Republican gathering for fear of Trump contamination. There’s no such reticence here in Philadelphia; in fact, it feels like they’re making up for that lack of investment.

It’s hard to ferret out all the special interests at the DNC, because there’s no full public schedule. Invitations are doled out individually, and people whisper about this or that event. But enter any official hotel where a delegation is staying, or any Philadelphia landmark, and you’re likely to have a complimentary drink thrust into your hand.

As Politico’s Ben White reported on Monday, private equity firm Blackstone has a meet-and-greet on Thursday. Independence Blue Cross, the southeastern Pennsylvania arm of the large insurer, held a host-committee reception Tuesday; their chief executive is the finance chair of that host committee. The same day, Le Meridien hotel had a private event for Bloomberg LP, and the Logan Hotel hosted “Inspiring Women, a Luncheon Discussion.” The sponsors included Johnson & Johnson, Walgreens, AFLAC, the Financial Services Roundtable (the industry trade lobby), and New York Life. (How many people were they serving, given the number of corporations involved?)

Facebook commandeered a bar inside the Wells Fargo Center for delegates and guests. Twitter rented out an entire restaurant, bestowing attendees with free breakfast, lunch and an open bar. (Full disclosure: I had a slider and some salad. The way I see it, I’ve boosted their market value through the free labor of tweeting and deserve something back.) And when the speeches end, convention-goers fan out to a sea of mostly industry-sponsored parties. A particular favorite of convention delegates is the Distilled Spirits Council kickoff, which in Philadelphia featured music from Jason Isbell and former Eagle Joe Walsh.

Those are just the liquor and cocktail-weenie bribes. An entire other category of corporate cash goes toward “policy discussions,” must-see educational roundtables with a host of luminaries. On Tuesday, Obama campaign guru David Plouffe (now with Uber) and Gore consultant Chris Lehane (now with Airbnb) unveiled new polling data on the sharing economy; a second Airbnb event celebrated the 1964 Mississippi Freedom Party, featuring actor Bryan Cranston. On Wednesday, the Information Technology and Innovation Foundation convenes its own technology conference, featuring four members of Congress, a Federal Trade Commission member, the president of the biotech lobby, representatives from Microsoft and Facebook, and former White House Press Secretary Jay Carney, now at Amazon.

A softer version—in perfect concert with the “Hillary works for families and children” theme of the week—is the corporate PR booth, highlighting charitable work, usually with children. JPMorgan Chase has its summer youth employment program. Johnson & Johnson (they get around) has the Save the Children Action Network, committed to eradicating rural poverty. I saw House Assistant Democratic Leader James Clyburn holding court at their booth when I passed by yesterday.

None of this is considered money toward the convention, which is being entirely privately funded for the first time. The donors who are actually paying for the festivitities in Philly are anonymous. So God (and Debbie Wasserman Shultz) only knows where it all comes from. And clearly the DNC wants to keep it that way.

The DNC’s host committee refuses to disclose the names despite a court order, allowing corporate benefactors to hide behind anonymity. The 2014 “CRomnibus” budget law massively increased contribution limits for political convention committees, which can raise up to $800,000 from a single donor per year. And overlooked by emails showing possible anti-Bernie Sanders bias by DNC officials in the Democratic primaries, the WikiLeaks trove released last Friday actually detailedhow the DNC woos big donors with gifts and perks.

The whole spectacle is not technically considered lobbying, but it may have a more insidious effect. Not only are elected officials compromised by their proximity to big money—a version of this happens daily in Washington, after all—but the delegates, usually the grassroots activists most likely to pressure their members of Congress to stand up for Democratic values, get caught up in the muck as well.

Big money didn’t necessarily overshadow Day 2 of the convention, with the historic selection of the first female president and a succession of speakers hailing Hillary Clinton’s lifetime of work. But it pervaded the whole scene. Right before the roll-call vote, Virginia Governor Terry McAuliffe, himself one of the most prodigious corporate fundraisers in Democratic history, addressed the convention. In an interview directly afterward, he suggested that Clinton would eventually come around and support the Trans-Pacific Partnership corporate trade deal, “with some tweaks.” Clinton campaign aide John Podesta had to refute McAuliffe; for his part,  Podesta has jumped in and out of government and corporate lobbying for three decades.

Wasserman Schultz, supposedly banished to Florida after resigning as DNC chair, was still hanging around Philadelphia, and slipped into the Wells Fargo Center to watch the roll call. She got to see the vice presidential nomination of her predecessor as lead party fundraiser, Tim Kaine, who ran the DNC from 2009 to 2011. During the roll call, lobbyists with the Society for Human Resource Management, which helpedstall the signature equal pay bill in Congress, cheered from the floor.

Former Attorney General and corporate lawyer Eric Holder took time off from his work with Uber and Airbnb to address the convention. Former Press Secretary Robert Gibbs, now Global Chief Communications Officer for McDonald’s, showed up in a video. Howard Dean praised Hillary Clinton on health care, but strangely left out her support for the public option. Perhaps that’s because he’s a lobbyist for the pharmaceutical industry, which doesn’t want government insurance plans driving down prices. Even former Secretary of State Madeleine Albright, who added her praise of Clinton to others’ on Tuesday night, has her own lobbying firm. And Tuesday closer Bill Clinton also has a certain, er, comfort with the corporate world.


The best speech I saw on Tuesday happened five miles from the Wells Fargo Center. In an afternoon address she should have unleashed the previous night—and not sponsored by anyone but her own Senate office—Elizabeth Warren gave a couple hundred delegates a Power Point presentation showing how the economy shifted from broadly shared prosperity to a funnel of practically everything to the very top.

The average American holds 15 times more debt than a generation ago, Warren noted, and one in three with a credit file is dealing with a debt collector. “I went to college for $50 a semester,” Warren said, but now fixed costs on education and health care have skyrocketed, making it impossible for the middle class to keep up. The reason: disinvestment in the public good, deregulation of banks and industry, and policies that pushed practically all economic gains upward.

Warren pointed the finger directly at lobbying, which grew seven-fold in the past 30 years. After the speech, I asked her about the corporate underwriting of practically everything in Philadelphia this week. “Too many CEOs have learned that they can invest millions in Washington and get billions in return with special deals with the government,” she said. “This is the central issue of 2016.”

You wouldn’t know that from the official, industry-sponsored proceedings. Maybe the ideological split within the Democratic Party has something to do with Bernie Sanders’s supporters distaste for the ostentatious display of corporate money, and how it has affected the party. The rare moment when overturning Citizens United gets a mention in a convention speech, loud whoops and cheers go up. But corporate influence on the party goes way beyond SuperPACs and campaign contributions; in Philadelphia, it is everywhere.

https://newrepublic.com/article/135564/dnc-one-big-corporate-bribe?utm_source=New+Republic&utm_campaign=793f2a71b5-Daily_Newsletter_7_27_167_27_2016&utm_medium=email&utm_term=0_c4ad0aba7e-793f2a71b5-60030489

THE RISE OF FACEBOOK AND ‘THE OPERATING SYSTEM OF OUR LIVES’

Siva Vaidhyanathan, UVA’s Robertson Professor of Media Studies, is the director of the University of Virginia’s Center for Media and Citizenship.Siva Vaidhyanathan, UVA’s Robertson Professor of Media Studies, is the director of the University of Virginia’s Center for Media and Citizenship. (Photo by Dan Addison)

Recent changes announced by social media giant Facebook have roiled the media community and raised questions about privacy. The company’s updates include a higher level of news feed priority for posts made by friends and family and testing for new end-to-end encryption software inside its messenger service.

As Facebook now boasts more than a billion users worldwide, both of these updates are likely to impact the way the world communicates. Prior to the company’s news-feed algorithm change, a 2016 study from the Pew Research Center found that approximately 44 percent of American adults regularly read news content through Facebook.

UVA Today sat down with Siva Vaidhyanathan, the director of the University of Virginia’s Center for Media and Citizenship and Robertson Professor of Media Studies, to discuss the impact of these changes and the evolving role of Facebook in the world. Naturally, the conversation first aired on Facebook Live.

Excerpts from the conversation and the full video are available below.

Q. What is the change to Facebook’s News Feed?

A. Facebook has announced a different emphasis within its news feed. Now of course, your news feed is much more than news. It’s all of those links and photos and videos that your friends are posting and all of the sites that you’re following. So that could be an interesting combination of your cousin, your coworker, the New York Times and Fox News all streaming through.

A couple of years ago, the folks that run Facebook recognized that Facebook was quickly becoming the leading news source for many millions of Americans, and considering that they have 1.6 billion users around the world, and it’s growing fast, there was a real concern that Facebook should take that responsibility seriously. So one of the things that Facebook did was cut a deal with a number of publishers to be able to load up their content directly from Facebook servers, rather than just link to an original content server. That provided more dependable loading, especially of video, but also faster loading, especially through mobile.

But in recent weeks, Facebook has sort of rolled back on that. They haven’t removed the partnership program that serves up all that content in a quick form, but they’ve made it very clear that their algorithms that generate your news feed will be weighted much more heavily to what your friends are linking to, liking and commenting on, and what you’ve told Facebook over the years you’re interested in.

This has a couple of ramifications. One, it sort of downgrades the project of bringing legitimate news into the forefront by default, but it also makes sure that we are more likely to be rewarded with materials that we’ve already expressed an interest in. We’re much more likely to see material from publications and our friends we reward with links and likes. We’re much more likely to see material linked by friends with whom we have had comment conversations.

This can generate something that we call a “filter bubble.” A gentlemen named Eli Pariser wrote a book called “The Filter Bubble.” It came out in 2011, and the problem he identified has only gotten worse since it came out. Facebook is a prime example of that because Facebook is in the business of giving you reasons to feel good about being on Facebook. Facebook’s incentives are designed to keep you engaged.

Q. How will this change the experience for publishers?

A. The change or the announcement of the change came about because a number of former Facebook employees told stories about how Facebook had guided their decisions to privilege certain things in news feeds that seemed to diminish the content and arguments of conservative media.

Well, Facebook didn’t want that reputation, obviously. Facebook would rather not be mixed up or labeled as a champion of liberal causes over conservative causes in the U.S. That means that Facebook is still going to privilege certain producers of media – those producers of media that have signed contracts with Facebook. The Guardian is one, the New York Times is another. There are dozens of others. Those are still going to be privileged in Facebook’s algorithm, and among the news sources you encounter, you’re more likely to see those news sources than those that have not engaged in a explicit contract with Facebook. So Facebook is making editorial decisions based on their self-interest more than anything, and not necessarily on any sort of political ideology.

Q. You wrote “The Googlization of Everything” in 2011. Since then, have we progressed to the “Facebookization” of everything?

A. I wouldn’t say that it’s the Facebookization of everything – and that’s pretty clumsy anyway. I would make an argument that if you look at five companies that don’t even seem to do the same thing – Google, Facebook, Microsoft, Apple and Amazon – they’re actually competing in a long game, and it has nothing to do with social media. It has nothing to do with your phone, nothing to do with your computer and nothing to do with the Internet as we know it.

They’re all competing to earn our trust and manage the data flows that they think will soon run through every aspect of our lives – through our watches, through our eyeglasses, through our cars, through our refrigerators, our toasters and our thermostats. So you see companies – all five of these companies from Amazon to Google to Microsoft to Facebook to Apple – are all putting out products and services meant to establish ubiquitous data connections, whether it’s the Apple Watch or the Google self-driving car or whether it’s that weird obelisk that Amazon’s selling us [the Echo] that you can talk to or use to play music and things. These are all part of what I call the “operating system of our lives.”

Facebook is interesting because it’s part of that race. Facebook, like those other companies, is trying to be the company that ultimately manages our lives, in every possible way.

We often hear a phrase called the “Internet of things.” I think that’s a misnomer because what we’re talking about, first of all, is not like the Internet at all. It’s going to be a closed system, not an open system. Secondly, it’s not about things. It’s actually about our bodies. The reason that watches and glasses and cars are important is that they lie on and carry human bodies. What we’re really seeing is the full embeddedness of human bodies and human motion in these data streams and the full connectivity of these data streams to the human body.

So the fact that Facebook is constantly tracking your location, is constantly encouraging you to be in conversation with your friends through it – at every bus stop and subway stop, at every traffic light, even though you’re not supposed to – is a sign that they are doing their best to plug you in constantly. That phenomenon, and it’s not just about Facebook alone, is something that’s really interesting.

Q. What are the implications of that for society?

A. The implications of the emergence of an operating system of our lives are pretty severe. First of all, consider that we will consistently be outsourcing decision-making like “Turn left or turn right?,” “What kind of orange juice to buy?” and “What kind of washing detergent to buy?” All of these decisions will be guided by, if not determined by, contracts that these data companies will be signing with consumer companies.

… We’re accepting short-term convenience, a rather trivial reward, and deferring long-term harms. Those harms include a loss of autonomy, a loss of privacy and perhaps even a loss of dignity at some point. … Right now, what I am concerned about is the notion that we’re all plugging into these data streams and deciding to allow other companies to manage our decisions. We’re letting Facebook manage what we get to see and which friends we get to interact with.

MEDIA CONTACT

Facebook, Google and the Tech Companies Bankrolling Hate at the RNC

ECONOMY
Trump has threatened to shut down the open internet. Why aren’t companies divesting from him?

Photo Credit: Khalil Bendib / OtherWords

It’s common for major corporations to sponsor political conventions to buy favor with political parties. But what about when the convention nominates a presidential candidate who’s an out-and-out racist?

That’s a deal breaker, right?

For some big tech companies, apparently not.

Facebook recently announced that it will provide funding and other support for the Donald Trump-led Republican National Convention. And Google will be the event’s official livestream provider via YouTube.

These companies need to find their moral compass and divest from hate.

“Trumped into a Corner,” an OtherWords cartoon by Khalil Bendib

Trump’s violent rhetoric has inflamed a national atmosphere that’s already hostile toward Latino, Muslim, and black communities, as well as women and people with disabilities. He’s called for the mass deportation of undocumented immigrants, promised to build a wall on the U.S.-Mexico border, and vowed to ban all Muslims from entering the United States.

Trump has also incited actual physical violence against people of color, and refused to denounce the white supremacist organizations that openly support him.

If that weren’t enough, Trump’s also threatened to shut down the open internet, censoring the dissident voices standing up against his hate and racism. He’s called for greater surveillance of communities of color, and has encouraged violence against protesters and journalists.

In short, Trump’s campaign isn’t “business as usual”—and corporations shouldn’t treat it as such. That’s why the racial justice group ColorOfChange has launched a campaign called Divest from Hate.

They’re urging major tech companies not to bankroll a platform for hate while Trump continues to incite violence against marginalized communities. Other groups, including my own, have joined the effort to push tech companies to pull their support from the Republican convention, including both direct financial donations and in-kind contributions.

This isn’t about left or right, but right and wrong. People of color make up a large portion of the users of services like YouTube and Facebook. These companies are essentially profiting off the very communities that Trump’s rallying against.

Erin Egan, a Facebook vice president for publicity, claims that the company’s involvement in the convention will “facilitate an open dialogue among voters, candidates, and elected officials.” But throwing a coronation ball for Trump and his white supremacist supporters has nothing to do with democracy.

It’s important to note that these companies have taken stands on other political issues.

Both Google and Facebook recently spoke out against North Carolina’s transphobic “bathroom bill.” And earlier this year, Facebook CEO Mark Zuckerberg circulated an internal memo calling out employees who crossed out the words “Black Lives Matter” on the signature wall at the company’s headquarters. He called the behavior “malicious” and “unacceptable.”

Now it’s time for Facebook and Google to take another stand against hate—and to join companies like Coca-Cola, Hewlett-Packard, and Microsoft that have already scaled back or cut their support to the Republican convention.

Lucia Martínez is an organizer with the Free Press Action Fund, a nonpartisan organization that doesn’t support or oppose any candidates for public office.

http://www.alternet.org/economy/facebook-google-tech-funding-trump-rnc?akid=14341.265072.CtYp-J&rd=1&src=newsletter1058139&t=24

Stephen Fry signs off from ‘The Grid’ again

Wed 20 Apr 2016 2.47pm

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Following a scathing departure from his four million Twitter followers regarding criticism of his BAFTA commentary in February, unelected UK and internet technology ambassador Stephen Fry has made an avowed departure from all social networks.

In a stinging 2,600+ word essay at stephenfry.com, the 58-year-old comedian, presenter and raconteur compares an exit from mainstream social network channels such as YouTube, Twitter and Facebook to the heroic plight of the heroes of 1970s dystopian sci-fi movies such as Logan’s Run and Soylent Green; thereby comparing the pre-eminence of social media with those highly-telescoped visions of ruthless government authorities.

Likewise Fry regards flight from the social networks in the same light as ‘unplugging’ from the enemy artificial reality offered to a ‘sleeping’ populace in The Matrix:

‘Jacking out of the matrix would cast one as a hero of the kind of dystopian film that proved popular in the 70s, Logan’s Run, Zardoz, Soylent Green, Fahrenheit 451 … on the run from The Corporation, with the foot soldiers of The System hard on your heels. We really are starting to live in that kind of movie, mutatis mutandis, so surely it’s time to join the Rebels, the Outliers, the Others who live beyond the Wall and read forbidden books, sing forbidden songs and think forbidden thoughts in defiance of The One.’

The tech evangelist, first baptised into his ministry by early association with Apple’s products, turns his powers of persuasion 180 degrees in the piece, in a plea for ‘Generation Z’ to rebel against the matrix:

‘Who most wants you to stay on the grid? The advertisers. Your boss. Human Resources. The advertisers. Your parents (irony of ironies – once they distrusted it, now they need to tag you electronically, share your Facebook photos and message you to death). The advertisers. The government. Your local authority. Your school. Advertisers..
Well, if you’re young and have an ounce of pride, doesn’t that list say it all? So fuck you, I’m Going Off The Grid.

The essay grounds its argument in the current millennial fad for ‘retro’ and ‘legacy’ – abstract, unlived ideas for young people captivated by the spirit of nostalgia for the fax age – but Fry, part of the ‘blank generation’ that emerged after the conformity of the 1950s and before the conformity of the yuppie age, ascribes genuine merit to the pre-digital society, and fond regard for the early days of the internet and the computer revolution:

‘The digital Wild West may have been rough and lawless but folk were politer to strangers and knew their manners better than the ruthless, ambitious citizens who took over. The pioneer territory has now had its shitty streets and crooked boardwalks paved over. In place of saloons there are strip malls, fun fairs and multiplexes. The telegraph and train killed the stage coach and the pony express.’

The highly discursive piece provides a fairly comprehensive history of the internet, and an array of historical examples demonstrating Fry’s contention that the current social media giants will fall as mightily as they have risen in the last ten years:

‘And Facebook will be dust one day. Hard to imagine perhaps but obviously and happily true… For now, Facebook is of course all powerful and finds itself busy eating the internet (thereby preparing its own extinction) and of course parents are on it. That’s how crap it is.’

‘Off the Grid’ is a refreshing note of rebellion because of who wrote it, though that’s somewhat counterbalanced by Stephen Fry’s epic history of departure, and not just from the virtual world. His last major retirement from Twitter was in 2009, following a row with another Twitter user. Fry suffers, now quite publicly, from bipolar disorder.

So he may be back – it wouldn’t be the first time. But his current spirit of rebellion is worthy of celebration:

‘I live in a world without Facebook, and now without Twitter. I manage to survive too without Kiki, Snapchat, Viber, Telegram, Signal and the rest of them. I haven’t yet learned to cope without iMessage and SMS. I haven’t yet turned my back on email and the Cloud. I haven’t yet jacked out of the matrix and gone off the grid. Maybe I will pluck up the courage.’

 

https://thestack.com/world/2016/04/20/stephen-fry-signs-off-from-the-grid-again/

You may hate Donald Trump. But do you want Facebook to rig the election against him?

 
Mark Zuckerberg
‘The dominance of Facebook in Americans’ daily lives, and the fact that more people get their news from it than any other source, means the influence of the company in elections has never been greater.’ Photograph: Stephen Lam/Reuters

You may hate Donald Trump. But do you want Facebook to rig the election against him?  Facebook could use its unprecedented powers to tilt the 2016 presidential election away from him – and the social network’s employees have apparently openly discussed whether they should do so.

As Gizmodo reported on Friday, “Last month, some Facebook employees used a company poll to ask [Facebook founder Mark] Zuckerberg whether the company should try ‘to help prevent President Trump in 2017’.”

Facebook employees are probably just expressing the fear that millions of Americans have of the Republican demagogue. But while there’s no evidence that the company plans on taking anti-Trump action, the extraordinary ability that the social network has to manipulate millions of people with just a tweak to its algorithm is a serious cause for concern.

The fact that an internet giant like Facebook or Google could turn an election based on hidden changes to its code has been a hypothetical scenario for years (and it’s even a plot point in this season’s House of Cards). Harvard Law professor Jonathan Zittrain explained in 2010 how “Facebook could decide an election without anyone ever finding out”, after the tech giant secretly conducted a test in which they were able to allegedly increase voter turnout by 340,000 votes around the country on election day simply by showing users a photo of someone they knew saying “I voted”.

Facebook repeated this civics engagement experiment on a broader scale during the 2012 election. While the testing did not favor any one candidate, the potential for that power to be used to manipulate voters became such an obvious concern that Facebook’s COO, Sheryl Sandberg, said, in 2014, “I want to be clear – Facebook can’t control emotions and cannot and will not try to control emotions.” She added: “Facebook would never try to control elections.”

Her comments came right after a controversial study conducted by Facebook became public. It showed that, in fact, the company had secretly manipulated the emotions of nearly 700,000 people.

Some 78% of Americans have a social network profile of some kind. The dominance of Facebook in Americans’ daily lives, and the fact that more people get their news from it than any other source, means the influence of the company in elections has never been greater. With each year that passes, the potential that an internet giant could swing an election gets greater.

Earlier this year, the Guardian reported on the treasure trove of data Facebook holds on hundreds of millions of voters and how it is already allowing presidential candidates to exploit it in different ways:

Facebook, which told investors on Wednesday it was ‘excited about the targeting’, does not let candidates track individual users. But it does now allow presidential campaigns to upload their massive email lists and voter files – which contain political habits, real names, home addresses and phone numbers – to the company’s advertising network. The company will then match real-life voters with their Facebook accounts, which follow individuals as they move across congressional districts and are filled with insightful data.

And in a Politico Magazine piece entitled “How Google could rig the 2016 election”, research psychologist Robert Epstein described how a study he co-authored in Proceedings of the National Academy of Sciences found that “Google’s search algorithm can easily shift the voting preferences of undecided voters by 20% or more – up to 80% in some demographic groups – with virtually no one knowing they are being manipulated.”

As Epstein says, much of this manipulation is unintentional: search results on Google are influenced by the popularity of other searches, algorithms are changed all the time for various reasons, and some tweaks that affect what people see about politics may not be the result of malicious engineers bent on changing the country’s political persuasions. However, the potential for that to happen is there – and the same risks apply to Facebook.

To be sure, many corporations, including broadcasters and media organisations, have used their vast power to influence elections in all sorts of ways in the past: whether it’s through money, advertising, editorials, or simply the way they present the news. But at no time has one company held so much influence over a large swath of the population – 40% of all news traffic now originates from Facebook – while also having the ability to make changes invisibly.

As Gizmodo reported, there’s no law stopping Facebook from doing so if it desires. “Facebook can promote or block any material that it wants,” UCLA law professor Eugene Volokh told Gizmodo. “Facebook has the same First Amendment right as the New York Times. They can completely block Trump if they want. They block him or promote him.”

To those disgusted by Trump’s xenophobia, his boorish and erratic behavior, this might seem like a welcome development. But one organisation having the means to tilt elections one way or another a dangerous innovation. Once started, it would be hard to control. In this specific case, a majority of the public might approve of the results. But do we really want future elections around the world to be decided by the political persuasions of Mark Zuckerberg, or the faceless engineers that control what pops up in your news feed?

 

http://www.theguardian.com/commentisfree/2016/apr/19/donald-trump-facebook-election-manipulate-behavior?CMP=fb_gu

US corporate tax cheats hiding $1.4 trillion in profits in offshore accounts

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By Patrick Martin
15 April 2016

A report issued Thursday by the British charity Oxfam found that the 50 largest US corporations are hiding $1.4 trillion in profits in overseas accounts to avoid US income taxes, much of it in tax havens like Bermuda and the Cayman Islands.

The biggest tax dodger is technology giant Apple, with $181 billion held offshore. General Electric had the second-largest stash, at $119 billion, enough to repay four times over the $28 billion GE received in federal guarantees during the 2008 Wall Street crash. Microsoft had $108 billion in overseas accounts, with companies like Exxon Mobil, Pfizer, IBM, Cisco Systems, Google, Merck, and Johnson & Johnson rounding out the top ten.

Overseas tax havens have been the focus of recent revelations about tax scams by wealthy individuals, based on the leak of the “Panama Papers,” documents from a single Panama-based law firm, Mossack Fonseca, involving 214,000 offshore shell companies. The firm’s clients included 29 billionaires and 140 top politicians worldwide, among them a dozen heads of government.

But the sums involved in corporate tax scams dwarf those hidden away by individuals. According to the Oxfam report, the offshore manipulations by the 50 largest US corporations cost the US taxpayer $111 billion each year, while robbing another $100 billion annually from countries overseas, many of them desperately poor.

The $111 billion a year in US taxes evaded would be sufficient to eliminate 90 percent of child poverty in America, effectively wiping out that social scourge. It is more than the annual cost of the food stamp program, or unemployment benefits, or the total budget of the Department of Education.

Oxfam timed the release of its report for the April 15 income tax deadline in the United States (actually Monday, April 18 this year), when tens of millions of working people must file their income tax returns or face federal penalties. Working people could face additional tax penalties of up to 2 percent of household income, to a maximum of $975, under the Obamacare “individual mandate,” if they have not purchased private health insurance.

There is a stark contrast between the IRS hounding of working people for relatively small amounts of money—but difficult or impossible to pay for those on low incomes—and the green light given to corporate tax cheats who evade taxation on trillions in income.

Federal Tax Paid vs Federal Loans, Bailouts, Loan Guarantees Received by 50 largest US companies 2008-2014

“As Americans rush to finalize tax returns, multinational corporations that benefit from trillions in taxpayer-funded support are dodging billions in taxes,” said Raymond C. Offenheiser, President of Oxfam America. “The vast sums large companies stash in tax havens should be fighting poverty and rebuilding America’s infrastructure, not hidden offshore in Panama, Bahamas, or the Cayman Islands.”

The Oxfam report, titled “Broken at the Top,” expresses concern that “tax dodging by multinational corporations…contributes to dangerous inequality that is undermining our social fabric and hindering economic growth.”

It continues: “This inequality is fueled by an economic and political system that benefits the rich and powerful at the expense of the rest, causing the gains of economic growth over the last several decades to go disproportionately to the already wealthy. Among the most damning examples of this rigged system is the way large, profitable companies use offshore tax havens, and other aggressive and secretive methods, to dramatically lower their corporate tax rates in the United States and developing countries alike.”

Oxfam collected figures available from the 10-K reports and other financial documents issued by the 50 largest US companies, covering the period since the Wall Street crash, 2008 through 2014, and presented them in an interactivetable. The figures included total profits, federal taxes paid, total US taxes paid (including state and local), lobbying expenses, tax breaks, money held in offshore accounts, and benefits received from the federal government, including loans, loan guarantees and bailouts.

Among the most important findings:

* The top 50 companies made nearly $4 trillion in profits globally, but paid only $412 billion in federal income tax, for an effective tax rate of barely 10 percent, compared to the statutory rate of 35 percent.

* The 50 companies spent $2.6 billion to influence the federal government, while reaping nearly $11.2 trillion in federal support, for an effective return of 400,000 percent on their lobbying expenses.

* The overseas cash stashed by the 50 companies, nearly $1.4 trillion, is larger than the Gross Domestic Product of Russia, Mexico, Spain or South Korea.

* US multinationals reported 43 percent of their foreign earnings from five tax havens, countries that accounted for only 4 percent of their foreign workforce and 7 percent of foreign investment. All told, US companies shifted between $500 billion and $700 billion in profits from countries where economic activity actually took place to countries where tax rates were low.

* In the year 2012 alone, US firms reported $80 billion in profits in Bermuda, more than their combined reported profits in the four largest economies (after the US itself): China, Japan, Germany and France. This figure was nearly 20 times the total GDP of the tiny island country.

The Oxfam report also pointed to an estimated $100 billion in taxes evaded in foreign countries, many of them rich in natural resources extracted by such global giants as Exxon, Chevron and Dow Chemical. According to the report, “Taxes paid, or unpaid, by multinational companies in poor countries can be the difference between life and death, poverty or opportunity. $100 billion is four times what the 47 least developed countries in the world spend on education for their 932 million citizens. $100 billion is equivalent to what it would cost to provide basic life-saving health services or safe water and sanitation to more than 2.2 billion people.”

The report cited former UN Secretary-General Kofi Annan’s assessment that “Africa loses more money each year to tax dodging than it receives in international development assistance.”

Oxfam offered no solution to the growth of inequality and the systematic looting by big corporations that its report documents, except to urge governments around the world to close tax loopholes. The group also pleads with the corporate bosses themselves not to be quite so greedy. Neither capitalist governments nor the CEOs will pay the slightest attention. But the working class should take note of these figures, which provide ample evidence of the bankrupt and reactionary nature of capitalism, and the urgent necessity of building a mass movement, on a global scale, to put an end to the profit system.

 

http://www.wsws.org/en/articles/2016/04/15/oxfa-a15.html