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Archive for the ‘General Electric’ Category

Nanny State Controls America through Corrupt Taxing Policies

Posted by Steve Markowitz on April 2, 2011

America has morphed in recent decades from a country comprised of can-doers to one where we look to the government to fulfill our needs.  With approximately 50% of Americans paying no income tax and another 10% paying very little, the Progressives have molded the country in a way that makes the receivers of governmental gifts dependent on that government and guarantees a huge voting block that will continue to give Progressives government jobs.

The pervasiveness of governmental handouts spans from those truly in need to wealthy corporations.  This welfare state mentality stifles private sector growth and individual creativity.  Today this Blog reviews two very different stories of these governmental handouts.

Adoptions: David and Thelma Ward

CNN reported on the refunds available for those who adopt children.  In this case, the Wards of North Carolina lend a helping hand to children in need, adopting five children in a three-year period.  While over the years they filed for tax credits available for the adoptions, because of their lower income level they could not take advantage of them.  However, the credits rolled over to future years, should their taxable income increase.

This year, the government change the rules making the credits refundable that means the money would be made available eve if the party paid no income tax at all.  Therefore, the Wards this year received a check from the IRS for $54,000.  Mrs. Ward was surprised by the refund and said: “We’re just overwhelmed – that amount was so huge it was unbelievable.”  Dee Carter of H&R Block, the Ward’s tax preparer, said: “We had never seen anything like it before, so we had to check it over and over again.”  Nothing should be surprising when it comes to our overreaching government.

The government tax rules on adoption go further.  A typical private adoption costs about $30,000, lending some logic to the refund.  However, the tax laws also allow those who adopt “special needs” children receive the refund even those they have no adoption expenses.  Yet 80% of foster children are considered to have “special needs” by the government.  In addition, North Carolina pays the Wards $3,300 a month the until the children turn 18.

While the Wards decision to adopt undoubtedly comes from a kind place in their hearts, it is not difficult to see how the system can be perverted.  The unintended consequences of the government taking money from some taxpayers and giving it to others often overshadows the positive effects of the government’s policies.

General Electric Corporation

The same Progressive mentality that justifies the Ward’s $54,000 refund permeates all parts of governmental policies.  Even wealthy corporations receive the governmental handouts.

General Electric (GE) is a huge company with $5 billion in profits in the United States alone.  Incredibly, GE did not pay one penny of U.S. corporate income tax for 2010 even though the corporate rate is 35%.  GE did nothing illegal, only taking advantage of available loopholes.  In a statement GE said that “pays what it owes under the law and is scrupulous about its compliance with tax obligations in all jurisdictions.”  True, but left unsaid is that a large part of these deductions came from losses suffered through its subsidiary, GE Capital, during  the Wall Street meltdown.  Yes, GE is one of the large financial institutions that not only benefited from the government’s bailout of Wall Street, but whose lending practices helped create the meltdown in the first place.

Adding insult to injury is GE’s tight relationship with President Obama.  It’s CEO, Jeffery Immelt, is a close Obama’s confidant as his Chairman of the Council on Jobs and CompetitivenessGE is also a major booster (and potential profiteer) of the President’s green energy push.  When one is on welfare, it’s good to have friends in high places in the nanny-state.

There are those that will see obvious justification in the Wards receiving the $54,000 check from the government.  When considered in a vacuum, it’s hard to not be an advocate for the Wards.  However, there is no vacuum when it comes to taxes.  When one party receives a tax refund or break, it comes at the expense of others in that same society.  This gives corruptive powers to those politicians and bureaucrats that decide who is worthy of the special treatment and who is going to pay the bill.

We should not be too tough on either the Wards or GE.  In reality, many of us are drinking from the same trough in one way or another, including all that have taken the mortgage interest deduction.  But this is exactly what the Progrssives in government want.  By offering so special breaks to so many, the government hooks the greatest number of people on the corrupt system thereby guaranteeing its further growth.

The only way to put an end to America’s corrupt taxing system is to eliminate all deductions and loopholes no matter how worthy a special interest group might believe the cause is.  This would not only result in much lower tax rates for all, but also mean that the peoples’ spending habits will not be dictated by the Progressives in Washington, DC.  Those that would fight such a simplified taxing system would do so only because they fear losing the advantage that they currently receive over other taxpayers.



Posted in General Electric, Government Handouts, Taxes | Tagged: , , , , , , , , , , , , , , , | 1 Comment »

GE’s Immelt to Head Obama’s Economic Advisory Panel

Posted by Steve Markowitz on January 24, 2011

President Obama announced that he is replacing retiring economic advisor, retired Federal Reserve Chairman Paul Volcker, with 51-year old General Electric (GE) CEO Jeffrey Immelt.  In appointing Immelt, Obama said: “The past two years was about moving our economy back from the brink.  Our job now is putting our economy into overdrive.”

While on its face Immelt seems to be a reasonable choice for those that believe in capitalism, his past and current priorities raise questions.  As the head of Obama’s panel of economic advisers, Immelt will have even more access to the President than he already had, being on an advisory board for Obama since 2009.  This access could be used to promote the Country’s overall good or more parochial interests of Immelt’s and GE.  Here are issues that make the later more likely:

  • Immelt will maintain his GE CEO position, raising potential conflicts of interest in recommendations made to the President.
  • Over half of GE’s revenue comes from outside the U.S.  In addition, GE has about 300,000 employees of which only 135,000 are based in the U.S.  Given the importance of GE’s business interests outside of the United States it is unlikely Immelt would be willing to make recommendations to the President that would clash with his firm’s foreign interests.
  • GE has owned NBC, a network that heavily favored Obama politically.  In addition, GE spent $39 million on lobbying in 2010, more than any other company according to government figures.  It is clear that this company understands the importance of greasing the wheels in Washington.
  • GE is currently attempting to sell billions of jet engines for the Joint Strike Fighter, an engine that the Pentagon has determined it does not want.  This automatically places Immelt in a conflict position between the two hats that he wears.
  • GE has been on the forefront of green energy and stands to gain from the sale of gear is sold to the government and/or subsidized by it.
  • GE has been criticized for continuing to do business with Iran while Iranian agents caused the deaths of American soldiers in Iraq.

When questioned about his new appointment, Immelt was quoted as saying he “understands what it takes for America to compete in the global economy.”  While a great sound-bite, Immelt’s history is of a person running an international conglomerate.  By their very makeup such corporations and their leaders have little loyalty to any individual country.

Should President Obama want to really understand the issues that small businesses in America face, those businesses that ultimately create most of the new jobs in this Country, he should look elsewhere for advice other than leaders from multi-national corporations and big labor unions.


Posted in General Electric, President Obama | Tagged: , , , , , , , , | 2 Comments »

General Electric – Don’t Stop the Gravy Train

Posted by Steve Markowitz on October 4, 2009

The Financial Times reported that General Electric has begun warning governments worldwide not to end their stimulus programs prematurely, as this action would send economies back into recession.  Should we expect GE to suggest anything else?

GEGeneral Electric is the world’s largest industrial Company.  Nani Beccalli, head of GE International, expressed concern as governments are beginning to discuss exit strategies for stimulus programs.  Beccalli said: “I am a bit concerned when I hear about exit strategies.“… “It is not the right time.”

Other large companies and private equity groups are expressing similar concerns.  However, this response is natural as they try to protect their incomes.   Read the rest of this entry »

Posted in General Electric, Governmental Intervention, Stimulus Program | Tagged: , , , , , , , | 1 Comment »