Corporate welfare in action ....

Discussion in 'Politics' started by dblack, Aug 24, 2017.

  1. Andylusion
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    Andylusion Gold Member

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    Sure, actually I can. Money is directly taken from my paycheck, to give to GM as a grant to develop batteries for Electric Vehicles.

    Money is given as subsidy for Ethanol, which otherwise would be completely eliminated from the market lacking that money.

    So I can point to numerous things that with government money, directly affect my life. Like the cost of electricity going up, to pay for subsidized 'renewable' energy, such as wind turbines.

    These are things that directly impact society, that are not due to tax breaks and tax deductions and tax abatement.

    I know this, because without a direct subsidy, these things would be unprofitable. No amount of a tax deduction, or tax break, can make an unprofitable business survive.

    If your business isn't making money, getting a discount on your land tax, isn't going to magically make you profitable.

    You might pick the lease spot on the left-side or right-side of the street, or town, or even state, based on lower taxes.... but a profitable business is profitable, or it isn't.

    I'm not going to change which company I do business with, or buy a computer from, or where I order stuff online, based if Apple has a 'data center' in Iowa, or Amazon has an office in Dublin Ohio.

    So I can confidently say that giving a tax break, to either one, will have zero impact on me, and likely have zero impact on the vast majority of people on the fact of the Earth, and I would wager even the majority in Dublin.

    And no, you have no made the case. At least not so far as I have read in this thread. You have made tons of claims. But claims, are not facts.
     
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  2. dblack
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    dblack Gold Member

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    What proof do you have that your money went to GM? Maybe your money went to Planned Parenthood, and GM got someone else's money. Do you have some way of tracking where your tax money gets spent?

    Do you have proof of that? Tax deductions, breaks, abatements, incentives, etc... are used to accomplish all the same things as grants and subsidies. If government gives tax breaks to people who install solar panels or more efficient appliances, how is that any different from subsidies to pay for wind turbines?

    Of course it can. Especially if the business is competing with other companies who don't get the special tax breaks.

    You're being logically inconsistent - condoning preferential treatment in one case, and condemning it in another. What is the "one weird trick" that makes it OK in one case, but not in another?
     
    Last edited: Oct 2, 2017
  3. Andylusion
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    Andylusion Gold Member

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    What proof do you have that your money went to GM? Maybe your money went to Planned Parenthood, and GM got someone else's money. Do you have some way of tracking where your tax money gets spent?

    Yeah, it's called the US budget, where I can, and have, seen where my tax money goes.

    Do you have proof of that? Tax deductions, breaks, abatements, incentives, etc... are used to accomplish all the same things as grants and subsidies. If government gives tax breaks to people who install solar panels or more efficient appliances, how is that any different from subsidies to pay for wind turbines?

    A local dealership here, got $1 Million dollars in US federal money, to build a wind Turbine for $2 Million. They also got a tax break. But if they had not gotten the money, the turbine would have been completely impractical, and unprofitable.

    A tax deduction would not have done that. The tax credit, is only 2.2¢ per kilowatt hour.

    It would be impossible to build that wind turbine profitably, without the direct government subsidy. Without them actually collecting money from the Federal Government, for green energy, there is no possible way to spend $2 Million dollars, and come out ahead making just 2¢ per kilowatt hour.

    Government money, makes this profitable. And of course, that tax deduction only works if you have taxes to begin with. If the dealership has a bad year where they break even, or have low profits, then a tax credit against zero taxes, is..... zero.

    The thing that makes this work, is government payments for "green energy certificates" and the direct subsidy of $1 Million dollars on a silver tax payer platter.

    That's where the problem is.

    You fix that problem, and the tax dedications will be largely irrelevant.

    Of course it can. Especially if the business is competing with other companies who don't get the special tax breaks.

    You're being logically inconsistent - condoning preferential treatment in one case, and condemning it in another. What is the "one weird trick" that makes it OK in one case, but not in another?


    No, it can't. You are wrong.

    If you have a business that isn't making money.... no amount of tax deduction is going to fix that. Sorry, you are just flat out wrong.

    And there are no specific businesses that are getting special tax breaks in the OP of this thread. I know, because I worked at other companies that are in the same park area of Dublin, that are all getting the same deduction. It's not Amazon alone.

    If you could say "only Amazon, and Amazon alone" got this, then ok that's a good point. But it's not true.

    Additionally, you are portraying this like this is a huge benefit to Amazon, that is going to make them vastly more competitive than everyone else in the market.

    This isn't true.

    Amazon has spent $1.1 Billion dollars, to get a few million in tax breaks? Basic math, says that this is a money losing idea.

    Other companies would never need to spend $1.1 Billion for land and new buildings, because they don't even have the staff to fill such places. Simply leasing existing buildings, would be half of a fraction of the $1.1 Billion Amazon is spending.

    So even without these tax breaks, these other companies are far better off than Amazon.

    Why then, does Amazon choose to spend massive amounts of money? Same reason people buy Mercedes instead of a Ford. Because they want to. Both can get them to work and back with equal effectiveness.

    But if you have billions to use to grow the company, why not? And a small tax cut is always a plus.

    But if you think that getting a small cut in taxes, is going to cut out the competition, when you are spending billions to get those tiny cuts, you are wrong. You can't end up ahead, by getting a tax deduction.
     
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  4. danielpalos
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    danielpalos Gold Member

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    We have massive US debt; corporations should also help us pay that as Persons of wealth.
     
  5. danielpalos
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    danielpalos Gold Member

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    Favored privileges and immunities for Persons of wealth.
     
  6. Conservative65
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    Conservative65 BANNED

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    If a livable wage is different based on 'where and how they live', you didn't have to specifically say it for it to apply.

    Since livable wage is nothing more than a leftwing push for people that have proven to be worthless in the way of skills getting more for nothing, it's an invalid concept. If they don't make enough for the skills they offer to cut it, they can either do without or have people like you voluntarily support them.
     
  7. Papageorgio
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    Papageorgio The Ultimate Winner

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    So any and all tax breaks, deductions for rich and poor is welfare? Should everyone pay one rate no matter the income?
     
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  8. danielpalos
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    danielpalos Gold Member

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    No, I would have to engage in, "nothing but repeal".

    I want to abolish the income tax (so the right wing won't have that to whine about), by ending our alleged wars on crime, drugs, and terror.
     
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  9. dblack
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    dblack Gold Member

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    Take a deep breath and think about what you're saying. Are you seriously making the claim that taxes can't make or break a business? When an argument inspires you to make such a specious claim, it's time to reconsider your position.

    Well, yeah, the articles did, in fact, cite tax abatements offered only to the companies in question, as a quid pro quo for their 'investment' in the community. Did you just not read them? Lemme guess "fake news"?

    No. I'm portraying this as an incremental encroachment on the free market. I'm not concerned with who comes out ahead or by how much. I'm concerned with government using its power to influence our economic decisions.
     
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    Last edited: Oct 5, 2017
  10. Andylusion
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    Andylusion Gold Member

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    Take a deep breath and think about what you're saying. Are you seriously making the claim that taxes can't make or break a business? When an argument inspires you to make such a specious claim, it's time to reconsider your position.


    It depends on exactly what type of tax we are talking about. Obviously if you impose a massive tax on the Yacht industry in 1991, then yes of course you are going to drive companies out of business. Not to mention they inherently have international competition.

    Ignorance, Stupidity or Connivance?

    So that isn't my claim.

    What I am talking about is a tax deduction. Which is a very different beast.

    There is a number of reasons why.

    If you have a business that is losing money WITHOUT a tax deduction, then getting a tax deduction isn't going to solve anything. Why? Because the corporate tax is on profits. If you have zero profits to begin with, then you have zero taxes to begin with. If you have zero taxes to begin with, then get a tax deduction does not help. You can't reduce the amount of owed taxes, below zero.

    By the way, for those who claim you can get money back from the government, and cite for example General Electric which got money back. That's because they paid too much in taxes throughout the year, or paid too much in taxes the prior year, and had it carried over.

    It is impossible for you to get a tax deduction that makes a failing business profitable. It is not possible.

    Now a tax abatement, could in theory make your business profitable....

    However, this is also virtually impossible. Because the only companies any city or state will give a tax abatement to, are companies that are able to develop the land. Amazon is spending $1.1 Billion in Ohio.

    Now before they get the tax abatement, we can reasonably assume they are paying full property tax. If they need that tax abatement to be profitable.... how are they surviving now? And how are they able to spend $1.1 Billion?

    And then you also have to realize the abatement will run out. If the only reason they are profitable is because of the tax abatement, then what happens when it runs out? Will they be forced out of business?

    Again, it would be impossible that any business with margins so tiny, that property tax could sink them, would ever have the money to develop the land anyway, and thus would never get such deal.

    Now throughout this entire country, there are literally thousands of examples of companies getting tax abatement. If you can find an example where a company was only able to survive on a tax abatement, and immediately went bankrupt when the abatement was up, I'd be very curious to read about it.

    Even then, I'd wager there are few examples, if any. I've worked at several multi-million dollar corporations, and property tax was almost nothing relative to their budgets. Just in looking up the company I worked for a few years back, the property tax is $50K. The annual revenue of the company was $14 Million.

    The idea that getting 50% off on the property tax, to $25K a year, is going to change a company rolling in $14 Million a year in revenue, from bankruptcy to profitability is beyond unlike. It's more like ridiculous.

    And honestly, the only way to really have taxes drive a company out of business is by either imposing taxes that are not tied to profits, like a high sales tax, or imposing a property tax so high, that it would drive all business into bankruptcy. I don't see that happening anywhere.

    So I stand by my original comment. No amount of a tax deduction, or tax break, can make an unprofitable business survive.

    Well, yeah, the articles did, in fact, cite tax abatements offered only to the companies in question, as a quid pro quo for their 'investment' in the community. Did you just not read them? Lemme guess "fake news"?


    But again, it has nothing to do with that company. The politicians didn't say "Ok, let us give Amazon, and only Amazon this special offer that no other company on the face of the earth can get".

    I know this because other companies are there, that got the exact same offer. It was not a "special Amazon only" deal. Any company that went there, would be offered the same exact deal. Again, there is a hospital in the exact same area that was given the exact same deal. The only reason the left-wing is freaking out over this deal, as opposed to the exact same deal given to the hospital, is because it's a non-profit hospital that earns billions in profit, instead of Amazon earning billions.

    Additionally, OSU has a place there, and was given the same deal. Where is the outrage over that?

    But the point is, dozens of companies are getting these deals, if they have the money to develop the land. So the claim that this is ONLY offered to the companies in question, is false. That's the only part of your claims that is "fake news". Absolutely any company willing to spend billions to develop otherwise unproductive land, can get these deals.

    And as I pointed out before, these deals make logical sense. Right now the land COSTS tax payers money. We have to pay taxes, to maintain and upkeep unproductive land. That's stupid. Why should I have to pay taxes to keep vacant land? Why not have it bought by a company, that will pay millions in taxes, and turn empty useless land, into something productive that produces jobs? Even 10 jobs, is better than zero, and costing tax payers money.

    No. I'm portraying this as an incremental encroachment on the free market. I'm not concerned with who comes out ahead or by how much. I'm concerned with government using its power to influence our economic decisions.

    Which at the Federal level I would agree with you. But all rights reserved for the states, means just that. And this simply isn't a real encroachment. Subsidies and grants are. But really... again, what effect does this have? Not a lot.

    No company is sacrificing income, to get a temporary tax abatement. Whether the data center is here in Ohio, or down in Kentucky, will have absolutely zero impact on the market, or Amazon, or profitability. Nor will a temporary tax deal give Amazon any competitive advantage over other companies.

    So again.... zero real effect. The only effects will be local. Obviously the local city in Kentucky that has the data center will get tax revenue from it, and some jobs. Now thousands, but some. Equally if it come here, then they won't have some tax revenue, and won't have some jobs. Locally, there is a minor difference. But in the broader context of the free-market.... this is not an important deal.

    Interestingly, I would assume your realize that your own side, sabotaged that talking point? After all, didn't you (or someone supporting your position), post an article by an economist who pointed out that these tax deals have almost zero impact on the growth of the general economy in those areas?

    You can't both tell me it has almost no impact whatsoever, and at the same time claim it's a massive encroachment on the free-market.

    Those are mutually exclusive claims.
     

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