Untaxed U.S. Corporate Profits Held Overseas Top $2.1 Trillion: Study

General view of General Electric GEnx-747 engine before a test at the GE Aviation Peebles Test Operations Facility in Peebles, Ohio                

General view of General Electric GEnx-747 engine before a test at the GE Aviation Peebles Test Operations Facility in Peebles, Ohio            

                            

By Kevin Drawbaugh and Patrick Temple-West of Reuters          

WASHINGTON (Reuters) - Foreign profits held overseas by U.S. corporations to avoid taxes at home nearly doubled from 2008 to 2013 to top $2.1 trillion, said a private research firm's report, prompting a call for reform by the Senate's top tax law writer.

"The new numbers ... certainly highlight what is one of the key challenges for tax reform. I do think there need to be some reforms in this area," Senate Finance Committee Chairman Ron Wyden told reporters on Tuesday on Capitol Hill.

Under U.S. law, corporations do not have to pay income tax on most of their overseas profits until they are brought into the United States. These earnings can be held offshore for years if they are classified as indefinitely invested abroad.

Research firm Audit Analytics said in a report issued last week that the total of such earnings was up 93 percent from 2008 to 2013, citing federal financial filings for companies listed in the Russell 1000 index of U.S. corporations.

Conglomerate General Electric Co had the biggest pile of earnings stored abroad, at $110 billion, the firm said.

Next were software maker Microsoft Corp, with $76.4 billion; drugmakers Pfizer Inc, with $69 billion, and Merck & Co Inc, with $57.1 billion; and high-tech group Apple Inc, with $54.4 billion, it said.

In response, GE said in a statement: "GE operates in more than 170 countries, and most of these overseas earnings have been reinvested in active business operations like manufacturing facilities and loans to non-U.S. customers."

A Merck spokesman said the company files its tax returns in accordance with all applicable laws and regulations.

A Microsoft spokesman referred questions to 2012 congressional testimony, in which company officials said it abides by foreign and U.S. tax laws.

In testimony in 2013 before Congress, Apple Chief Executive Tim Cook said the company is a large taxpayer and does not use tax gimmicks. Apple declined to comment on the new report.

Pfizer was not immediately available for comment.

BAUCUS AND WYDEN

Congress has quarreled for years over the law that lets multinationals stash profits abroad tax-free. Some favor killing the law, known as offshore corporate income tax deferral, and some back a one-time tax holiday that would let companies bring foreign profits home, or "repatriate" them, at a low tax rate.

Debate over offshore deferral flared again in November when Wyden's predecessor as finance committee chairman, former Democratic Senator Max Baucus, proposed doing both. Baucus resigned weeks later to become U.S. ambassador to China.

Wyden in the past has called for repeal of offshore deferral, along with a repatriation holiday, among other changes to the tax code, which he last month called "a rotten carcass that the special interests feast on."

No decisive action is likely for now, however, with Congress deadlocked over fiscal issues at least until after the November mid-term congressional elections, according to policy analysts.

Next year lawmakers are likely to mount another push to overhaul the tax code, a politically difficult feat that has not been accomplished since 1986, when Republican President Ronald Reagan and a divided Congress managed to get it done.

The top U.S. corporate income tax rate is 35 percent, though few multinationals pay anywhere near that thanks to tax-reducing loopholes written into the code in the past 28 years, including some that have enabled wider use of offshore deferral.

(Additional reporting by Lewis Krauskopf and Bill Berkrot in New York, Bill Rigby in Seattle, Edwin Chan in San Francisco; Editing by Howard Goller and Tom Brown)

Source: http://news.msn.com/us/untaxed-us-corporate-profits-held-overseas-top-dollar21-trillion-study

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DEMOCRATIC CHAIR CALLS REPUBLICANS “ANTI-LIFE AND ANTI-CHOICE” FOR VOTING DOWN MEDICAID EXPANSION

DEMOCRATIC CHAIR CALLS REPUBLICANS “ANTI-LIFE AND ANTI-CHOICE”

FOR VOTING DOWN MEDICAID EXPANSION

Tennessee Democratic Party Chairman Roy Herron today called Republicans “anti-life and anti-choice” for voting down a proposal by Democratic House Leader Rep. Craig Fitzhugh which would have expanded Medicaid to insure 330,000 Tennesseans.

“Denying health care to working Tennesseans and children is ‘anti-life and anti-choice’.  It condemns sick Tennesseans to die and denies them the chance to choose life-saving health care,” said Herron.

House Bill 1723 would expand Medicaid to 330,000 Tennesseans for as long as the federal funding level remains at 100%.  House members voting for Rep. Fitzhugh’s bill were Democratic Reps. JoAnne Favors and David Shepard and just a lone Republican, Rep. Kelly Keisling.  Voting against were Republican Reps. Steve McManus, Dennis Powers, John Ragan, Jimmy Matlock, and Curtis Johnson.

Herron described the consequences of voting down expansion in terms of lives, dollars, and jobs lost:

“Yesterday Republicans voted to cost Tennesseans taxes, jobs, and even lives.  According to a Harvard School of Public Health study in the New England Journal of Medicine, the most prestigious medical journal in the country, over three years 5,000 Tennesseans will die needlessly because of Republican partisanship.

“In addition, a University of Memphis study showed Medicaid expansion would produce 18,000 new jobs.  This ought not be a partisan issue. It ought to be about saving hospitals, jobs, and lives.

“Yet some Republicans hate the President more than they love Tennesseans--and others fear the Tea Party more than they ‘love our neighbors as ourselves’. The Republicans voted to send our $1 billion a year in 100% federal funding for Medicaid expansion to New York and California, depriving Tennessee of needed funds with disastrous consequences for local hospitals and our state economy. They have chosen to save themselves from Tea Party criticism by sacrificing the lives of their fellow Tennesseans who will die without the health insurance provided by this bill.

“Deuteronomy 30:19 instructs us this way: “I have set before you life and death, the blessing and the curse; therefore choose life that you and your children may live.” None of our neighbors and loved ones should have to die because politicians rejected Deuteronomy 30 and the Golden Rule.  Republicans denying Tennesseans life-saving health care should never again call themselves ‘pro-life’, not when they condemn 5,000 uninsured Tennesseans to die.

“Every Republican voting against expanding Medicaid and every murderer on Death Row has taxpayer-funded health care.  So if the politicians and the prisoners, the lawmakers and the lawbreakers, have government-provided health care, what’s wrong with working women and working men and children having health care?”

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Valentines Pledge

In my campaign, I have told many of you how important it is to me to build an economy that works for everybody and keeps America growing healthy. That means actions like raising the minimum wage, which will add $450 Billion to the economy, and passing the Paycheck Fairness Act to close the earning gap between women and men, a reform that will put another $447 Billion into the economy, money that ordinary people can use to pay for the things they need every day.

This week Congress actually passed a bill that lets us pay what we owe through March next year, but Diane Black, who talks tough about paying down the debt voted again to block the measure, along with Tea Party Republicans who have stated over and over that they would shut down the government if they don't like the budget.

It costs $1.925 Million every time Congress holds a vote. This one was worth it, but last year they voted 47 times to repeal healthcare wasting over $90 Million, votes that amounted to a shutdown of the government costing our economy $24 Billion. That is not responsible government, but that's exactly how Diane Black voted once again. We need a new generation of leadership to avoid default and avoid economic catastrophe.

There is some good news, though. Check out the latest report from the Congressional Budget Office:

"The federal budget deficit has fallen sharply during the past few years, and it is on a path to decline further this year and next year...under current law, the deficit will total $514 billion in fiscal year 2014, compared with $1.4 trillion in 2009. At that level, this year’s deficit would equal 3.0 percent of the nation’s economic output, or gross domestic product (GDP)—close to the average percentage of GDP seen during the past 40 years."

With some common sense solutions we can get our budget back on track, but we need a Congress that will work together and make worthwhile improvements. Join me in my campaign to bring a fresh new perspective to Congress. My pledge to you, this Valentine's Day, is that I will work hard to make the American dream a real possibility for every Tennessean.

I will see you on the campaign trail,

Amos

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Republican Policies Failing Tennessee

Republican Policies Failing Tennessee

Forecasts show that Tennessee will rank 44th in job creation in 2014

NASHVILLE, Tenn. - A new jobs forecast by Moody’s Analytics shows that Tennessee may have one of the worst job creation rates in the country this year. The report, released by Stateline, estimates that Tennessee will rank 44th in job creation in 2014 with a 1.23% growth rate, which is the worst in the entire Southeast region.


“Tennessee has one of the highest unemployment rates in the country and the top priority of the Republican leadership is wine in grocery stores?” said House Democratic Leader Craig Fitzhugh. “Clearly investors and economists are trying to send the majority party a message about their priorities, but so far, it doesn’t seem like anyone is listening.”


Tennessee ranks 43rd in the nation for unemployment rates according to the Bureau of Labor Statistics. Tennessee’s 8.1% unemployment rate is over one point higher than the national average rate of seven percent.


“Republicans have spent the last three years cutting taxes for the rich and making it harder for working men and women to make a living,” said House Democratic Caucus Chairman Mike Turner. “Trickle-down economics hasn’t worked in the 30 years it has been tried, so why did they think it would be any different in Tennessee? It is time to build our economy from the bottom up by raising the standard of living for working families, creating more job opportunities for the middle class, and investing in an education system that prepares our children for the 21st century economy.”


House Democrats have listed jobs, education and people as their top priorities for the 2014 session which begins on Tuesday, January 14. Democrats will present bills that allow for more investment in small businesses, raise the minimum wage for working men and women in Tennessee, and expand Medicaid – which will save and create thousands of jobs throughout the state. 

Source: Tennessee House of Representatives Democratic Caucus  http://us3.campaign-archive1.com/?u=4077225f412bbfb3c5fb6f9c9&id=9673ab176c

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Back to Work Budget

7 million new jobs in one year

$4.4 trillion in deficit reduction

We’re in a jobs crisis that isn’t going away.  Millions of hard-working American families are falling behind, and the richest 1 percent is taking home a bigger chunk of our nation’s gains every year. Americans face a choice: we can either cut Medicare benefits to pay for more tax breaks for millionaires and billionaires, or we can close these tax loopholes to invest in jobs.  We choose investment.  The Back to Work Budget invests in America’s future because the best way to reduce our long-term deficit is to put America back to work.  In the first year alone, we create nearly 7 million American jobs and increase GDP by 5.7%.  We reduce unemployment to near 5% in three years with a jobs plan that includes repairing our nation’s roads and bridges, and putting the teachers, cops and firefighters who have borne the brunt of our economic downturn back to work.  We reduce the deficit by $4.4 trillion by closing tax loopholes and asking the wealthy to pay a fair share.  We repeal the arbitrary sequester and the Budget Control Act that are damaging the economy, and strengthen Medicare and Medicaid, which provide high quality, low-cost medical coverage to millions of Americans when they need it most.  This is what the country voted for in November.  It’s time we side with America’s middle class and invest in their future.

 

The Economic Policy Institute Policy Center provided technical assistance in developing, scoring, modeling, and analyzing the Back to Work budget. EPI’s analysis can be seen here: The ‘Back to Work’ budget: Analysis of the Congressional Progressive Caucus budget for fiscal year 2014

Job Creation

Infrastructure – substantially increases infrastructure investment to the level the American Society of Civil Engineers says is necessary to close our infrastructure needs gap 

Education – funds school modernizations and rehiring laid-off teachers

Aid to States – closes the recession-caused gap in state budgets for two years, allowing the rehiring of cops, firefighters, and other public employees 

Making Work Pay – boosts consumer demand by reinstating an expanded tax credit for three years 

Emergency Unemployment Compensation – allows beneficiaries to claim up to 99 weeks of unemployment benefits in high-unemployment states for two years 

Public Works Job Programs and Aid to Distressed Communities – includes job programs such as a Park Improvement Corps, Student Jobs Corps, and Child Care Corps

Fair Individual Tax  

Immediately allows Bush tax cuts to expire for families earning over $250K

Higher tax rates for millionaires and billionaires (from 45% to 49%)

Taxes income from investments the same as income from wages 

Fair Corporate Tax

Ends corporate tax bias toward moving jobs and profits overseas 

Enacts a financial transactions tax 

Reduces deductions for corporate jets, meals, and entertainment 

Defense

Returns Pentagon spending to 2006 levels, focusing on modern security needs

Health Care

No benefit cuts to Medicare, Medicaid, or Social Security 

Reduces health care costs by adopting a public option, negotiating drug prices, and reducing fraud

Environment

Prices carbon pollution with a rebate to hold low income households harmless 

Eliminates corporate tax subsidies for oil, gas, and coal companies GETTING AMERICANS BACK TO WORK

The Back to Work Budget creates nearly 7 million jobs in its first

 

 

Full budget documents are below. 

Side_by_Side (03/15/13 09:32 AM PST)
Economic Policy Institute - Back to Work Budget Analysis (03/14/13 11:15 AM PST)
Executive Summary (03/13/13 03:48 PM PST)
Resumen Ejuctivo (03/13/13 02:24 PM PST)
Source: http://cpc.grijalva.house.gov/back-to-work-budget/
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Social Security and Medicare

In 1935, Democrats and President Franklin Roosevelt created Social Security. In 1965, Democrats and President Lyndon Johnson created Medicare. Ever since, Democrats have continually fought to defend these cornerstones of the American Dream in the face of attempts to dismantle or undermine both.

PROTECTING SOCIAL SECURITY In recent years, Democrats have beaten back Republican plans to privatize Social Security—plans that would have exposed the retirement funds of millions of American seniors to great risk on the eve of the financial crisis.

STRENGTHENING MEDICARE Recently enacted health reform strengthened the Medicare trust fund, expanding its life by more than a decade. The Affordable Care Act also will improve care across the board, reduce fraud, and finally close the hole in Medicare drug coverage known as the “donut hole.” As of 2011, seniors are eligible for free coverage for certain preventive services.

HELPING AMERICANS SAVE FOR RETIREMENT Democrats want to make it easier for all Americans to participate in retirement accounts at work and support a system where employees have pension portability, so workers don’t lose their pension if they change jobs.

Source: http://www.democrats.org/issues/retirement_security

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Infrastructure

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Minimum Wage

In 1938, the Fair Labor Standards Act established a federal minimum wage to serve as “a floor below wages,” to reduce poverty and to ensure that economic growth is shared across the workforce. While the minimum wage still serves as protection for the country’s lowest-paid workers, today it is far below its historical level and loses value every year due to inflation. In fact, if the federal minimum wage kept up with inflation it would be $10.75 an hour, not the $7.25 it is today. 

MinWage_2012dollars                    

Sen. Tom Harkin (D-Iowa) and Rep. George Miller (D-Calif.) introduced a bill in 2013 to raise the federal minimum wage to $10.10 an hour by 2015 and would index it to inflation—a modest proposal. If the federal minimum wage had kept pace with workers’ productivity since 1968, the inflation-adjusted minimum wage would be $18.67.

MinimumWage_productivity                    

Raising the federal minimum wage has broad support. Not only do four out of five Americans support raising it to $10.10, but four out of five economists agree that the benefits of raising and indexing the minimum wage outweigh any costs.

MinimumWage_fair_minimum_wage_act_2013                    

Even in a struggling economy, studies have shown that increasing the minimum wages doesn’t damage job growth—in fact, a landmark study found the opposite; employment increased as did consumer spending in the years following the increase.

MinimumWage_consumerspending                    

Some states, however, are taking legislative measures to undermine U.S. wages and labor standards. In recent years, states have passed laws that restricted the minimum wage and have stripped workers’ rights to overtime pay and sick leave. The corporate lobbies behind these initiatives have been fiercely opposed to raising the minimum wage and indexing it to inflation. This means that the country’s lowest-wage workers are collectively earning tens of billions of dollars less per year than their counterparts were in 1968. And the profits are being funneled to the top 1%.

If the Minimum Wage Had Grown at the Same Rate as Wages for the Top 1%

While the wages of the country’s top earners have kept pace with productivity, workers earning at or below minimum wage are having trouble making ends meet, and they’re disproportionately women. Nearly two out of three minimum wage earners are women and of those, more than half are older than 24.

MinimumWage_femaleworkers                    

In every state, a full-time, minimum wage worker with two children lives at or below the poverty level. And in every state, that same worker couldn’t afford a two-bedroom apartment working 40 hours a week.

MinimumWage_AffordRent                    

Raising the minimum wage is a critical and simple way to help repair the underlying weakness in our economy. It would boost consumer spending and increase the purchasing power of millions of low-wage workers, especially in states with the highest percentages of low-wage workers—many of which also have the highest rates of poverty.

States with the Highest Percentage of Minimum Wage Workers
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