The annual agony of tax filing is always a headache but this year the average taxpayer may be complaining of migraines (and a sickening feeling in the stomach) following the New York Times’ revelation that General Electric paid no 2010 taxes despite US profits of $5.1 billion. (GE even asked for a “refund” of $3.2 billion.) It seems the argument that “corporations are people” endowed with First Amendment rights (to, say, spend millions of dollars on public elections) does not extend to include the concept that corporations also have social obligations (like abiding by the law, facing jail-time for criminal behavior, or paying taxes).
GE, a powerful multinational that builds nuclear weapons, designs nuclear powerplants (like the Mark-1 reactors melting down in Fukushima), and molds public opinion through its ownership of MSNBC, is not the only tax scofflaw in the ranks of the country’s Biggest Businesses. The list of Tax Non-payers includes the likes of AIG, Bank of America (BofA), Citigroup, and General Motors (all of which benefited from the $700 billion taxpayer-financed bailout in 2008). BofA paid no taxes for 2009 and 2010 — despite having received a $138 billion bailout package. (For the record, not all big banks are tax-outlaws: Wells Fargo paid $6.3 billion in taxes in 2010.)
BofA claims it doesn’t owe the American people any help in balancing the federal ledgers because the bank didn’t make any profits. Unlike real people who pay real taxes on all their income and are limited to certain deductions, a corporation can deduct virtually all of its expenses. And thanks to the corporate-crafted vagaries of the US Tax Code, BofA was able to inflict the ultimate indignity on the average American taxpayer by asking for — and receiving — a government “refund” of nearly a billion dollars. (In 2009, BofA raked in a total of $1.9 billion in “refunds” from federal, state, local and foreign regulators.)
While BoA claimed a pre-tax loss of $5.4 billion in US operations for 2010, it was a different story beyond the US borders, where BofA stashes billions of foreign earnings in offshore banks, far from the reaches of the US Treasury.
In 2008, the Government Accountability Office reported that 83 of the biggest publicly traded US firms operated offshore tax havens and BofA was in the top tier with 311 foreign subsidiaries in 115 tax havens — 59 of them in the Cayman Islands.
In its 2010 annual report to stockholders, BofA boasted that it had $17.9 billion in profits tucked away in overseas accounts. This allowed BofA to masquerade as a corporate pauper. It also allowed BofA to avoid paying Uncle Sam $2.6 billion in taxes on those hidden assets.
While BofA pleads poverty, it treats its top officials like princes. CEO Brian Moynihan received $1.25 million for his services in 2010 (admittedly a significant cut from his previous year’s take of $6.06 million). But while BofA was posting $5.4 billion in losses on its US operations, Moynihan’s salary was being boosted by $50,000 and enhanced by $905,000 in bonuses and $10 million worth of stocks.
Channel Your Outrage: Move Your Money
Happily, there is an alternative to for-profit mega-banks. Community banks and credit unions offer all the conveniences of Big Banks but without the onerous fees and shady dealing associated with corporate banksters. In addition to offering fee-free ATMs and financial services that can out-compete their corporate rivals, locally owned and operated banks and credit unions invest their profits in their own communities.
In the weeks leading up to Tax Day, the Move Your Money Campaign is encouraging everyone who still has their money squirreled away in a globo-centric commercial bank to “vote with your bucks” and truck your nest eggs over to your nearest neighborhood bank.
On April 12 and 13, Berkeley Community College will be hostng a “community bank-in.” Sign up at the Ambassador’s Desk on the first floor and truck on down to the Atrium in the basement to meet a host of local alternative people’s banks, including:
1st United Services Credit Union (www.1stuscu.org)
Cooperative Center Federal Credit Union (www.coopfcu.org)
USE Credit Union (www.usecu.org)
Contra Costa Federal Credit Union (www.contracostafcu.org)
Community Bank of the Bay (www.communitybankdbay.com)
Mission National Bank (www.mnbsf.com)
Mark your Calendars:
How the Big Banks Stole Our Education.
BCC Auditorium. April 12. 12:15-1:15 PM.
Featured guest speakers: Catherine Austin Fitts, Founder, Solari Investment Advisory Services, LLC; Dennis Bernstein, Host of KPFA’s Flashpoints; Joanne Gifford, Spokesperson for US Uncut.
Move Your Money Community Day.
BCC Atrium. April 13, 12:15 - 1:15PM. Art, Music and Free Speech hosted by BCC students and faculty.
For more information, contact: www.bccmoveyourmoney.blogspot.com
And the Civic Engagement Club: www.bcccivicengagement.com