Good for Microsoft, kicking the American worker when he’s down. President Obama means to close a loophole in the taxcode that allows corporations to “deduct… cost at a high tax rate and report… profits at a low tax rate.” In other words, win-win for the corporation at the expense of the United State Treasury. You know how Microsoft’s Steve Balmer said he’s deal with the closing of this loophole? “We’re better off taking lots of people and moving them out of the U.S. as opposed to keeping them inside the U.S.” Neat.
It’s to difficult to decipher what Balmer meant here. Is he threatening to move jobs overseas altogether, putting more American workers out of work, or is he saying that Microsoft would rather move employees to some low-tax country? That is, paying for John Doe to leave the U.S. so he can work for Microsoft somewhere else. I’d have to see that to believe it.
Now, I’m not saying that a foreign worker doesn’t have any less of a right to a decent life than an American one (“Americans are the only people who deserve jobs!”), obviously, but it’s so disappointing to see Microsoft, one of this country’s greatest companies, balk at mere idea of having to pay more taxes, taxes that it ought to be paying in the first place. (Closing the loophole in question could net the government an additional $86.5 billion by 2019.) Of course, Microsoft will hide behind the notion of protecting the “shareholders,” while conventionally omitting that the U.S. government has to protect those shareholders as well, with a functioning military, making roads, ensuring that stop lights work, educating children, etc… all things that taxes pay for.
(And now I sincerely expect to be called all sorts of nasty names, which is fine.)
No offense, but you might want to stick to blogging about technology rather than criticizing Microsoft for not wanting to pay more towards the current administration’s socialist programs.
No offense, but you may want to actually, you know, *look up* socialism:
http://www.merriam-webster.com/dictionary/socialism
The comment had to do with “socialist programs,” not the completed socialist state itself. You may want to look that up.
Kevin Phillips, former Republican adviser and strategist for Richard Nixon is certainly no socialist; here are couple quotes.
“freer markets have been leading us to plutocracy: The rule of the rich”
“What you get is money gaining a momentum that produces a kind of corruption. Part of it’s financial corruption, which we’re starting to see unfolding; part of it’s political corruption, which is that money moves in and corrupts the political system; and part of it, actually, is ideological- – that money rules, that those who have money are entitled. And this actually corrodes American democracy. And those who don’t make it get discouraged, and they think it’s unfair, and they’re right”
Just for added measure, a quote from the leftist CIA fact book
“Since 1975, practically all the gains in household income have gone to the top 20% of households”
I suppose to Plutocrats (Republicans) economic fairness is socialism.
OMT: Perhaps you should should allow kfr the clarification rebuttal; rather than structure words to fit your argument. Nonetheless unless you been leaving on Mars, anyone with half a mind knows the anti-Obama people associate his administration with socialism; notwithstanding the baffle “completed socialist state”
how is this an article on “gear”?
I think its an article more on the Microsoft tax “Crunch”.
I won’t call you names. I’m sure that I might get called a few for agreeing with Microsoft’s (Balmer) statement. It would do the government good to hear loud and clear that high tax rates are not the answer to increasing revenue. When we get to keep more of our money, we spend it. This drives revenue higher that any other activity.
Take a look at the WSJ article on Missing Millionaires (http://online.wsj.com/article/SB124329282377252471.html). Corporations are no different than individuals.
Our leader campaigned on the fact that he was going to keep American jobs here, but has succeeded in selling part of one American car company to Fiat and another to a Chinese company. His policies and those of his administration are a large factor in declining revenues.
Fire away.
first off the loop holes they are closing meaning they have been getting away with paying the taxes they should have always payed he complaining that he actually has to pay it now its like us renting a 100 dollar a month parking garage space and only paying 10 dollars a month and getting away with it till now you got pay the price you should have always payed tax breaks for the richest is coming to an end they have to pay there fair share just like every other business and i see nothing wrong with that
(typo previous post)
first off the loop holes they are closing meaning they have been getting away with paying the less taxes they should have always payed he complaining that they actually have to pay it now its like us renting a 100 dollar a month parking garage space and only paying 10 dollars a month and getting away with it till now you got pay the price you should have always payed tax breaks for the richest is coming to an end they have to pay there fair share just like every other business and i see nothing wrong with that
So Microsoft should just pay more taxes because it makes one feel all warm and fuzzy inside?
I thought the purpose of any business was to make money and cut expenses (and taxes are expenses, right?)
Right on man, MS is saying it first. Every other publicly traded company is going to do exactly the same. Since when do higher taxes create jobs or spur growth? Get ready for innovation to leave this country.
they having been paying less taxes than everyone else thanx to these loopholes by stock holders in congress so ending these loop holes means they have to pay what they aways payed say you and your neigbor had the same house same pool your mortgage was 100,300 his rent was 55,021cause he a big business guy and had a tax loophole but the loop hole is closing and now he has to pay 100,300 just like you and your saying that’s not fair how explain it to us all i got time the me pull up a seat and get a shuvel for the bull$2it im about to hear
Sounds like some people need to take courses in economics from these posts. Tax cuts are not the end all be all for stimulating the economy. The government actually puts money back into the economy and generates better results faster. Imagine that!
I love how people just think the government is an evil empire out to destroy us. While the great and noble companies in the US are here to make us strong. Well let me count the ways kind sir, Enron ring any bells? How about AIG? Or how about Mr. Maddoff’s investing firm? Oh I know who came up with mortgage backed securities? Was it the government?
The simple fact is that there needs to be balance in our society. Companies can’t pay 100% tax and they can’t pay 0.001%. There has to be a happy medium. All Obama is proposing is closing a loophole these people have been using to avoid paying their share of the tax burden. He is not increasing anything.
The government is generally an evil empire. Even the founders understood this, hence the limits created to keep the federal government small, and less involved in our lives.
Generally, the government does not stimulate the economy. History has never proven this. Great and strong economies have always been facilitated by a free people, free to spend and earn…and not be taxed up the wah-zoo.
It’s the individual American that is great and honorable. Neither corporations, as an entity, or the government deserve those titles. However, those corporations employ great Americans.
I’m a massive fan of Apple. I make great efforts to live a MS free life. However, talks like this make me consider my stance on MS.
Trevor,
No, the founders created a series of checks and balances in order to protect the public.
Where do you think the money comes from that employs people at Lockheed and other large defense contractors? You don’t think those billions of dollars are stimulating the economy?
As I stated previously, you must have balance. I agree a free market is good, however you must temper it with government checks to protect the public from greedy people. Give me a “true” free market and I will show you a world with revolts against the corrupt, rich classes running the society.
the government needs to stay out of everything. period. and dont give me the “need to take economic classes” BS. the government does not invest money back into the economy as you state, they print money out of thin air thus causing massive inflation. if we had a sound money system and eliminated the federal reserve we wouldnt be in this mess in the first place. the US government bails out failing countries, then in turn they tax companies that do produce work here, so they are forced to leave to stay competitive. our economic system is corrupt and its because of fake government agencies like the federal reserve and shady politicians that we are in this mess, that we will not recover from.
and your statement “Give me a “true” free market and I will show you a world with revolts against the corrupt, rich classes running the society.” the rich class rules our society now, rich get richer, the poor get poorer. keep the system we have now, and we will see a revolt against the rich class ruling the society.
and btw the founders also warned against a centralized banking system because of the corruption it causes. so ill take a “true” free market anyday over this fraud system we got today.
oops meant failing COMPANIES, not countries, mt on my part
Don’t fall for that administrator “loophole” BS. That is its answer for everything. “Closing a loophole” What a bunch of BS. Should we talk about the birth certificate loophole??? No, all you Obama fanboys want is to tax and go after all those greedy companies – lets stick it to the man. These are the publicly traded companies that pay dividends to a boatload of pension plans, 401ks, and other retirement schemes. So when you tell all of America that you are going to reduce profits by taxing more, you are saying you are willing to screw with peoples retirements, people who have worked all there lives to enjoy the last few years in comfort. Now where are all these taxes going to go? Into social programs for the failures of society – the drug users, drunks, single mothers of 10 by age 30. Yup, nothing more than a wealth redistribution plan in the execution phase. The current administration has a plan to keep all of you poor forever, this way it can keep selling you hope.
With all due respect J43K, your statement:
“The government actually puts money back into the economy and generates better results faster.”
has got to be one of the most moronic things I have heard all day. When has the government ever proven that they can spend your money and my money better than we can? NEVER! It’s not the government’s responsibility to create jobs. In fact the idea of the government of becoming a job creating entity runs completely counter to the principles this country was founded upon (do your research man).
Private businesses are the real engine of this economy, not the government. If the socialist bureaucrats would understand that and stop trying to tax corporations to death, this economy would turn around much much faster. Too bad the entire executive and legislative branches of our government are being largely controlled by socialists right now and hence, this problem is only going to get worse before it gets better.
And one more thing, Microsoft is going to be just the first of many corporations that will be moving jobs overseas with the oppressive taxation of this administration. It’s not unpatriotic, It’s just smart business on their part.
Loophole? These so-called “loopholes” are everday applications of the tax code. A study was once done in which several IRS employees were asked to save as much as they could by legally applying the tax codes to their own incomes. They came up with a wide variety of methods, but all methods applied to any one tax return would have yielded different results. Exactly what does Microsoft owe to the country that they do not already pay in jobs and taxes? Why don’t you offer to pay more taxes? Hello?
Crocodile tears for the US Treasury. Maybe they wouldn’t have to screw over MSFT if they stopped selling so much debt?
I don’t know the details of this story so I’m afraid I cannot comment too strongly. However, I there really is a “loophole” that corporations are taking advantage of to tune of billions of dollars, then by all means I think they should pay it. I have to pay my obscene taxes…so should they.
Who was the fool that creates “loophole”s and why would they do that?
Here is the answer:
politicians/legislatures create the “loopholes” & do so to influence behavior — the behavior might be to get them to keep more jobs in the USA, or to bring money back to the USA (as opposed to keeping it all overseas). There are a number of reasons, but it is silly that the government, who made the ““loopholes” to act like the players of the game are the evil ones because the government made the rules of the game.
Now, if a company, or other entity (person), is breaking the law – hammer them, but that is not what is being talked about. This is a “you are evil because you are doing what we wanted you to do” argument.
the bush admin gave tax breaks to companies that outsourced anymore questions
Microsoft is a disgrace to this country, threatening to leave, while Apple is looking to build a server farm in SC. If Microsoft leaves the stateside cause of tax I say the whole world boycotts they’re service and shitty OS.
Carlos, you can argue that Microsoft’s OS is inferior all day long and I won’t have a problem with that. What I do have a problem with is people saying that a company is a “disgrace” or “unpatriotic” because they aren’t thrilled about paying excessive taxes and they want to avoid doing so.
The real disgrace is a President and a congress that think that they have the right to tax people and corporations to a ridiculous degree so that they can fund all of their socialist agendas. If the government would stop spending so much money, they wouldn’t need to tax so excessively and corporations wouldn’t need to be looking to take business overseas. Make taxes fair to all, and I assure you that there will be a tremendous reduction in people looking for loopholes and taking business overseas. Too bad the socialist government we currently have will probably never understand that……
I think we need to redefine our expectations of companies. Is Microsoft an American company or not? Does that mean they should be loyal to Americans or not? If not, the American government, which is designed to protect the rights of American individuals, should be particularly wary of them.
As a developer, I really appreciate Microsoft products. The .NET platform is the absolute best programming environment out there. SQL Server has matured into an excellent enterprise database. Windows is still, by far, the best OS out there.
However, I’m also an American. If you’re going to whine about socialism, then whine about the roads, the military, the post office, and all of the other wonderful things this government has given you. The rich, who own the media and do not want to pay taxes because they are greedy bastards, have been promoting this “pure, unfettered capitalism is good” line for years… but that’s just how we ended up in the mortgage crisis–no checks and balances on greedy lenders who were working both sides of the fence.
As human beings you should be distrustful of government, but you should be equally as skeptical of corporations. These entities have power over you, and depending upon who is driving them, they can harm you. Nothing wrong with keeping an eye on emotional Ballmer–so that he doesn’t throw this great company, Microsoft, away to the lowest bidder.
Joe – if the government stuck to providing roads, the military, and the post office (and I am not sure that any of those three things except the military are “wonderful” – and Obama is going to cut spending on the Military) then I wouldn’t be worried about socialism. However, they are going WAY beyond providing those basic services and are now trying to control private industry (i.e. GM).
If you are so distrustful of corporations and “the rich”, then go start your own business….that’s the beauty of capitalism! However, our government is trying to make that increasingly difficult with burdensome taxation and overregulation of business.
THIS NEEDS TO BE POSTED AGAIN. THANK YOU KFJ. WE ARE HEADING TOWARDS SOCIALISM…WAKE UP PEOPLE!!!!!!!!
krf – June 4th, 2009 at 7:19 pm PDT
No offense, but you might want to stick to blogging about technology rather than criticizing Microsoft for not wanting to pay more towards the current administration’s socialist programs.
Let’s be honest here. The tax code changes every year. Sometimes, the changes benefit the taxpayer, sometimes it does not. Threatening to move jobs is not going to change that.
On another not, MS is one of the biggest proponents of increasing H1B visa’s, so it doesn’t matter if they move jobs offshore, because they import and employ a lot of “labor” already.
Ok people, we get it. You don’t agree with the current administration’s policies regarding letting the loophole that allowed businesses to pay less taxes expire. You feel that them having to actually pay a near-proportionate amount of taxes will eventually halt innovation and production within business, and run this country into the ground.
We get it.
We get the whole questioning the birth certificate of an individual who was born to an American citizen. We get the whole “he’s creating more socialist programs” argument. I honestly understand your concern however superannuated it may be.
The real fact of the matter is that this article, although lacking in technological advancements, is about a big technological player possibly threatening to move a portion of their business overseas to prevent paying the same taxes we all pay. I believe this is disappointing because of the status both within this country and abroad that Microsoft has as a leader, innovator, and model of a successful company. If what this article says is truly the stance of Microsoft, it shows others that will eventually have to pay higher taxes, however proportionate they may be, that simply cutting and running is the best way to go.
All this will eventually do is create more obstacles for the companies that choose to leave. Who really honestly believes that any government would happily allow its country-based businesses take their jobs abroad in order to avoid taxes?
What will eventually happen if this were to come to pass is the government would slap a fee on any product that is created abroad by the U.S. based company (for example) and enters the country of residence, (similar to what they began doing to Honda and Toyota until they built assembly plants in the U.S.)
Yes, one could say that the companies would simply pass on the governmental fees to the consumer- however when a lower cost alternative is made available (i.e. the companies who elected to pay their share of taxes and continue to be innovative – Apple, anyone?), the company saddled with the additional fees will be forced to do one of two things.
1.) Suck it up and pay their share of taxes, so that they can begin selling a cost-competitive product.
2.) Attempt to buck the trend and hold on to hope that consumers will elect to purchase their more expensive product.
It’s honestly as simple as making it more expensive to produce a product overseas than to stay and pay their share of taxes. I am a PC man at heart, and if this does come to pass, it will really make me do a lot of rethinking.
p.s.
I honestly don’t believe that Microsoft will move a significant portion of jobs overseas. With the fees associated with producing products overseas, It would be financial suicide. Part of their continued success was their ability to undercut the competition in price, and to saturate the market with low-cost, high-visibility products. Purposely making their products cost more because they did not want to pay taxes would do more harm than good to their partnerships with computer manufacturers.
This is what Obama said before he was elected. He wanted to lower taxes for the poor and raise taxes, cut loopholes for the rich. He said that right off the bat and now Steve Ballmer is saying he’ll move MS to another country. What did he think Obama was joking? What would Bill Gates do? I doubt he’d move MS.
its funny how americans always come up with “socialism” every time big corporations or overly rich people have to pay taxes. Its not that I like socialism I hate it in fact. I wouldnt imagine living in cuba where they dont have shit and there is a dictator. but really there has to be some balance. you cant just have the most extreme inhumane capitalism extremely rich people while having poor people on the streets, no health care for most working americans.
Its all propaganda from the 50’s. America is never going to be socialist. ( I hope so ) Do not let some take away your rights and funds that are for you saying this is “socialist” or that is “communist”.
Look at Europeans (sweden, france, germany) countries with moderate taxes. Look at Canada. They all have free health care. And they have innovation too. (fuel cells, airbus, bmws, etc). They have one of the best engineerings of the world. AND THEY ARE NOT SOCIALISTS!.
Taxes are needed to pay for education, health care and military (remember america has 2 wars) and they do stimulate the economy. MS has enough money. Gates is the number 1 rich in the world and ballmer is 2nd or 3rd. geez. They are only going to pay now that they always had to pay by law, not anything more.
Seriously of all the people here. are you all big corporations? do you all make more than $250,000 per year? If not this is actually going to be FOR you not against you. And even if you are big corporations if you are making a big ass profit it would not hurt you to contribute a little more for your country. It is called PATRIOTISM not SOCIALISM.
First of all, American companies already pay some of the highest tax rates in the industrialized nations. 2nd, Obama said he would lower the taxes on the poor, but 1) the poor don’t pay income taxes, 2) his energy, medical and farming programs, a federal sales tax will pull more money out of the pockets of the poor and middle class–the two classes that can not afford more taxes.
Many companies will be going to Ireland…I’m Irish–maybe I’ll move too.
I like how people call it patriotism to pay MORE taxes. No one has ever mentioned how much they pay now, it is about 5.8 billion over the last 12 months. And this doesn’t include the Unemployement taxes, Disability taxes, Social Security taxes, Medicare taxes etc.
I don’t think Microsoft has ever complained about paying taxes they just don’t want to pay MORE taxes.
And the “Loop Holes” are political language. It was no fancy trick that somebody found in the tax law. The law was written to try to allow multi-national companies to grow and compete against others. It was written this way on purpose.
When Daimler bought Chrysler it had the option to incorporate here in the US or in Germany, it choose Germany because they were friendlier to multinational companies. This cost Billions in taxes but our politicians have learned nothing from this!
If Obama continues on his current path, he will conclusively prove that he is the worst president in the history of this country. He has quadrupled the national debt since his time in office. He used fear to get the “stimulus’ bill passed, claiming that if it didn’t, the economic crisis would get much worse. And what has happened since it passed? It’s gotten even worse! Unemployment continues to soar, our currency is become less and less valuable, our debt is at a level that will be impossible for even our grandchildren to pay off, and we are becoming more and more beholden to countries like China! Nice job Barry!
And if those things weren’t enough, he is taking major steps toward nationalizing many businesses. He has nationalized banks, car companies, and soon our health care. He and his cronies in congress want to pass legislation that will determine how much you and I can be paid for our jobs. And trust me, this is just the beginning. He is marching us toward his vision of socialism, and he will use fear, guilt, and oppresive taxation to get us there.
By the time he is finished, he will make George W. Bush look like the greatest president ever.
Google already moved their AdSense division to Ireland in order to avoid U.S. taxes.
Google just did it quietly, whereas Microsoft is talking about it publicly.
Every other business in America must think about how to offshore as much as possible in order to protect it from the rapaciousness of the Obama administration.
Those businesses who fail to protect themselves will be unable to compete with foreign-owned firms and will simply disappear from the marketplace.
Yeah, I wonna see MS the great innovator going abroad. Their business model is using all political clout and connections to avoid anti-trust trouble and suffocate the competition. Can you call new proprietary formats technological advancement? If they really take most of their jobs overseas would the government and all its agencies still pretend that Windows is the only OS and MSoffice the only office suite out there? Remember what happened a couple of years ago when the Commonwealth of Massachussetts denied using MSOffice because of its proprietary formats (xls, xlsx, doc, docx …): Ballmer had to pull all the strings he could to finally make them reconsider.
Go ahead, make the IRS and the federal government mad and risk losing your best market.
What’s hilarious is that both Google and Microsoft personnel supported Obama and gave thousands to his campaign. I wonder how they are feeling now about him? If I were Gates, I’d get my company as far from Obama as I could. After all, Obama may decide he wants to control Microsoft next.
http://www.OpenSecrets.org
Make the gov’t mad?! Yeah I guess there is that — and I guess there is also the risk of making me …and millions of other computer users that only need a little push to finally go learn Linux. FU Microsoft – and FU every other corp that thinks boycotting isn’t outside the scope of motivation of Americans. Get out of the car and help push for f’ing sake. If you can’t stand by us in hard times – then who the f gives a s#$t about you?!
And to my brainwashed compatriots – Obama is providing an OPTION to a healthcare system whose cost has been driven up outrageously by complete corporate control. Healthcare should be affordable to EVERY citizen of the United States – period. The corps have not been able to achieve this. Time for a new strategy.
“Socialist” measures are the only thing that has kept “capitalism” around this long (See New Deal) We would have imploded long ago without them. You jerkfaces would have supported Hoover, I know it.
How is it that during the same year many businesses are struggling, oil refiners and weapon manufacturers record record profits, the most obvious being Exxon/Mobil which posted the greatest profit for any corporation EVER last year. Those oil-filled d-bags need to pay for the smog I breathe generated by their plants and the burning of their products – not to mention their fair share of taxes.
I get so sick of this…. compay’s dont pay taxes, no matter what the rate… individuals are the only Ones who pay taxes… again individuals are the only entity that pay taxes.
how high can it go; most Americans pay over 50 cents on the dollar. 23% payroll taxes 22% imbedded taxes, around 10% state sales tax, tax on telephone, gas and utilitys. TAX TAX TAX… when will people wake up individuals are the only one who pay taxes… end of story