By SN
Saturday June 6, 2009
Slashdot – June 6, 2009:
“Microsoft CEO Steve Ballmer is threatening to move Microsoft employees offshore if Congress enacts President Obama’s plans to curb tax avoidance by US corporations. ‘It makes US jobs more expensive,’ complained billionaire Ballmer. ‘We’re better off taking lots of people and moving them out of the US as opposed to keeping them inside the US.’ According to 2006 reports, Microsoft transferred $16 billion in assets to secretive Dublin subsidiaries to shave billions off its US tax bill. ‘Corporate tax is part of the overall advantage of doing business in Ireland,’ acknowledged Ballmer in 2005. ‘It would be disingenuous to say otherwise.'”
#63
There is no question that it is possible to be “too” big. However, “too big” relates to the impact a given company has on the country’s economy as opposed to its market cap or number of employees. Using the tiny number of corporations that fit into the category “too big” as an argument against all “large” corporations is silly. If Microsoft is too big what about Apple, Yahoo, Google and Sun?
Corporations like Microsoft have what’s called a “fiduciary responsibility”, a legal responsibility to make a profit for their shareholders.
If you have a 401k, you are a shareholder of some corp. somewhere. They will make the changes necessary to make a profit.
Before you knock Microsoft, take a look at the legislation forcing them to make the changes to continue to make money.
It’s easy to say get rid of these “evil corporations” until you realize your 401k relies on them and they employ hundreds of thousands of hard-working Americans and provide a way for those Americans to put food on their tables, drive the cars they want and pay their mortgage…
#70 – Beecher Bowers – Corporations like Microsoft have what’s called a “fiduciary responsibility”, a legal responsibility to make a profit for their shareholders.
And the government should have the obligation of making as much as possible out of each tax dollar. Perhaps they should stop paying Microsoft tax and go for something like this:
#70:
“legal responsibility to make a profit for their shareholders.”
This is simply not true.
‘Dodge v. Ford Motor Company’ did not go so far as to say a corp is legally required to make a profit for shareholders.
#70
“It’s easy to say get rid of these “evil corporations” until you realize your 401k relies on them…”
I think most people with 401(k)s now are painfully aware of what they rely on.
The term “tissue of lies” comes to mind.
#71
I think your point is that the govt wastes a lot of money. Yes, agreed.
#72
From the text of the ruling in Dodge V. Ford Motor Co.
“A business corporation is
organized and carried on primarily for the profit of the stockholders. The powers of the
directors are to be employed for that end. ”
and yes, I’ll give you the fact that there is disagreement over how far this goes.
#73
If you don’t like the decisions made by the companies you own a part of, invest elsewhere and dont buy their products.
#35, Patrick, RE:# 32 JimR said, “Microsoft is a cheat. They are using the resources of the US and paying Ireland for them.”
What resource are they using and not paying for? Got a list or are you just blowing hot air?
… please tell me that you know what your Federal taxes pay for. Regardless of how the shares are divided up, there is a system in place. Microsoft is required to pay their share like every other citizen.
If Microsoft moved from the USA tomorrow, you would lose 4.3 billion in tax revenue. They can’t take all the jobs with them and they can’t replace those jobs with someone else. They search the world taking the best of programmers as it is. They would have to keep an operation going where they are now, and most of the jobs would be safe. For everyone else developing products for MSFT, it would be business as usual. It’s a global economy.
#74:
“A business corporation is organized and carried on primarily for the profit of the stockholders.”
Where is there a legal mandate in that sentence?
The problem with misinterpreting Dodge v. Ford is that it gives anti-corp peeps an argument that goes something like, ‘corporations are legally bound to make profit and can’t choose to do otherwise!’ which isn’t true.
If Microsoft begins pledging allegiance to Ireland or some other country, it’ll be interesting to see if that other country can be as effective an advocate for intellectual property rights as the U.S. government has always been. Let’s not forget that software companies live or die based on I.P. rights enforcement.
On a more personal note, Ballmer sucks.
Microsoft zooms to the top spot once again in patriotic zeal.
#76, Cirdan,
You tell ’em buddy. Show ’em who’s the boss. Let everyone know what a dick you are.
#81 – Cirdan sounds like a fat, towel head.
Pretty freakin scary the number of commenters who appear to be so set in their beliefs of how ‘corrupt corporate America is’, that the only way they will believe themselves wrong is when the whole country collapses.
It’s a shame that HISTORY isn’t taught a bit more in schools….so we don’t have to go thru the destruction of repeating it over and over again.
So move to fuckin Ireland, monkey boy!
Maybe it’s time for someone in Congress to introduce legislation calling for greater use of open source software by the federal government. Perhaps that would help Ballmer remember how much he loves the good ol’ U.S.A., in exchange for certain considerations…
Conservatives on this board are brilliant. “What has U.S. infrastructure, education system, government and corporate laws ever done for Microsoft??”
Great point. But it makes you wonder…
Why, then, doesn’t Microsoft uproot and move to Ireland entirely?
Why didn’t move *all* of their operations out of the country YEARS ago?
Idiots.
#87:
“Hey America! We want your expensive infrastructure and the quality of life it makes possible — but we’re not going to do our share to pay for it.”
We’re charged capital gains taxes when we cash in Microsoft stock. Everyone Microsoft employs pays income tax. Everyone who purchases a Microsoft product pays sales tax.
You act like corps generate absolutely no income for the gov’t. They do directly and indirectly.
“Why, then, doesn’t Microsoft uproot and move to Ireland entirely?”
Because, duh, there was no incentive to. That can change, and when it does, poof. They’re gone.
This is why I support the Fair Tax!
#15/31 In this mad race to the bottom, could some wing nut tell us what taxes the Democrats have raised.
And yes, what taxes are being increased for the majority of US citizens? Can’t find them?
Tobacco and I didn’t have to search google. Nice way to help out the poor on that one.
#50, Perhaps we should start actually working within our means a bit and try to produce the best things and services we can without going into debt doing it?
Small businesses don’t get government handouts when they are drowning in debt. They go out of business. Living trillions beyond one’s means are solely the purview of big governments and big business.
Amen. I’ve been in business nearly 10 years and grown from just me to 12 people and I’ve done it without credit (other than a $2500 credit limit credit card for office supplies). I’ve grown the business soley on cash-flow.
#51, If Microsoft disappeared tomorrow, the effect on the economy would be devastating. Forgetting the people employed directly by Microsoft, there are hundreds of thousands of people that use their technology to produce solutions for other companies both small and large.
It would destroy us, that’s for sure. Every single one of my customers use MS. They only use MS because they are assured that MS isn’t going out of business tomorrow. We are a MS partner and get all the Microsoft software for about $500/yr. If we didn’t have MS, we’d all be out of work.
But, I guess if we raised taxes on MS, they would raise their rates to us, which means we would have to raise our rates to customers, which means they would have to raise their rates to the consumer. In the end, companies are going to get their profit.
New Quote: “Yeah, let’s raise taxes on the corporations. I’m not paying enough for my goods!”
#52, Yep. We lost quite a bit of revenue last year when a couple of larger companies moved their operations overseas.
#54, Granted, that scenario is not about to happen. However, what definitely could happen is that MS changes its status to be a foreign corporation and moves most of its production overseas and leaves a US subsidiary. No one would notice any difference in their software. The only difference would be the massive loss in tax revenue to the US, the State of WA, King County and the city of Redmond.
Actually, the federal government would be in a serious pickle. They cannot purchase the goods of a foreign company (all software contracts would permantely expire, upgrades impossible, etc.). They would be required, by law, to move to something produced domestically. I don’t think Linux fits that category. Talk about a nightmare trying to switch everything over to Unix.
#74 If you don’t like the decisions made by the companies you own a part of, invest elsewhere and dont buy their products.
Bingo!
What is so secretive about companies using Ireland for lower taxes? A visit there would tell you Microsoft, Oracle, Sun, Dell, Intel, IBM, etc. all take advantage of the lower taxes.
The lower tax rate applies to monies earned overseas NOT in the US. Corporations are setting up complex business structures to avoid bringing in profits into the US. Some call it tax avoidance but the Corporations will call it tax minimization. Ireland, until recently, has prospered greatly under this tax structure and it is no secret how they made it happen.
I can’t blame Microsoft, more profits keep Wall Street happy. Full US taxes are paid with the profits from what I purchase from Microsoft here in the US. Do I really care how they want to treat profits Norway? Not really.
#92 LibertyLover wrote “Actually, the federal government would be in a serious pickle. They cannot purchase the goods of a foreign company (all software contracts would permantely expire, upgrades impossible, etc.). They would be required, by law, to move to something produced domestically. I don’t think Linux fits that category.”
I’d like to challenge your statement because I believe it to be false. Our own Defense Logics Agency (DLA) uses software made by SAP, a company based in Germany. SAP is also the primary source of technology behind GFEBS, the Army’s new web-enabled financial, asset and accounting management system.
Your concerns about Linux seem to be unfounded as well. According to the Novell website, “US government agencies can purchase and deploy SUSE Linux Enterprise with confidence, knowing that it fully complies to the latest network infrastructure policies implemented by the US federal government.”
You seem to love accuracy less than you love liberty 😉
re: Canada calling- MS already has a large operation in Vancouver. I think they set it up because it is becoming more difficult to keep foreign nationals in the US, but it’s close to Redmond.
According to the article, about 40% of their employees aren’t based in the US already. I suspect that Ballmer’s just blowing more hot air. He’s probably pissed that they’re going to have to dig around for the next loophole. And given the relationship between MS and the EU, he’s going to move there? Really?
This quote was priceless: “It’s just a question of how much will the Dow come down,” Ballmer said. “It’s not about companies anyway; we’re talking about shareholders.”
How much cash is MS sitting on, rather than distributing it to the shareholders? That’s been a sore spot for years. And now he’s concerned for the shareholders?
I don’t like Steve Ballmer or Microsoft.
Yet unfortunately there could be a lot of truth in what he says in the way it could apply to the behaviors of other US companies as a response to tax hikes.
Complicated world.
# 75 JimR said, “please tell me that ”
As I thought. Hot air, your accusation was baseless and you can’t answer to it. Fail.
What a load of rubbish.
Ms isn’t going anywhere. If there were jobs that Microsoft could have taken offshore for a profit advantage they would have already done that. Having them actually pay their taxes might slightly shift the balance – but not hugely. Those highly educated, experienced, and well paid engineers. They ain’t moving. Same with the vast majority of well paid jobs. I don’t see Balmer leaving the ‘land of the free’.
I really don’t understand, why anybody would argue they shouldn’t pay their taxes. If being forced to pay their taxes make them to make some adjustments, then so be it. That’s the free market isn’t it?
So it’s a empty stupid threat.
And the same applies to all the multinational companies that come out with this sh*t. If you want to do business here great. But you have to pay your taxes, just like everyone else does. Right?
#94, It’s possible there is a “sole-source” clause grandfathered in.
I just recently had to go through the entire legal hurdle of verifying some software I was reselling to the federal government was made in the US and that I was a US-based company.
They should go offshore, then we’ll see how much worse their products will be 🙂
#100, Liberty Loser,
I did that in 2002, 2003, and twice in 2005 for some of our products. Not one form took more than a half hour to complete. That half hour though returned a lot of business and was much, much, less work than completing an ISO9000 audit.
I’m all for it!! If you ppl don’t see the writing on the wall, you’re a bunch of idiots. You tell me, how many totally US based companies are there are by state that support over 5000 jobs? Not friggin many anymnore and the last one in my state just got taken over by the government. One generation secured our freedom….my generation enjoyed it….yeah, we screwed up the next generation who wants someone to make the decisons for them because they are too lazy to.