PeoriaStory

Caterpillar prospers while workers languish, and its CEO gets an F in economics

PEORIA -- Here's a very interesting May 26 story about Caterpillar, Inc. that the Peoria Journal Star didn't run, though business reporter Steve Tarter does sort of discuss it in his column.

Read the original column, then ask yourself, which came first, the chicken or the egg!

Check out this quote from its CEO, Doug Oberhelman. whose current pay is $22 million per year, while some of Cat's workers are eligible for food stamps:

 

"Then comes the difficult question: Why is Caterpillar fighting its workers over wages?

 "Oberhelman nods briskly, eager to put the issue to rest.

“We have to be competitive if we’re gonna win. And frankly, if we’re not competitive ... we’re not gonna be here in the next 30 years. That’s a simple message, but” — he starts to hammer his hand against the table — “it’s very ... very ... tough.” After a pause, he lets his hand lay flat. “I always try to communicate to our people that we can never make enough money,” Oberhelman continues. “We can never make enough profit.”

"When will workers’ wages rise? “The answer to that is: when we start to see economic growth through GDP,” he said. “Part of the reason we’re seeing no inflation is because there’s no growth. Inflation was driven by higher labor costs, not higher goods costs. Frankly, I’d love to see a little bit of that. Because I’d love to pay people more. I’d love to see rising wages for everybody.”

Oberhelman's answer indicates he must be smoking something.

What makes the GDP grow? Answer:  higher wages.  His statement makes no sense. 

There will be no growth if wages don't increase. 

How many people do you know who would buy a new car or home if only they made more money?

Who does he think pays for Cat's equipment -- the tooth fairy?  No, it's government, based on taxes, which depend on the economy and wages. And corporations building things, based on sales, based on wages.

If profitable corporations fight their workers on wages, there will be no growth, and the economy likely will collapse again or stagnate.  It's the old chicken and egg situation. Give Oberhelman an 'F' in logic and economics.

 -- Elaine Hopkins

 

 UPDATE 5/29/13 - Here's a story and photo of a Caterpillar bulldozer destroying a historic Mayan temple.  It's not Caterpillar Inc.'s fault but....it is symbolic of the greed destroying the planet, of which Cat is a part.

 -- E.H.

Four Illinois corporations pay more to lobby than they pay in taxes

Peoria -- Here's an interesting news release, with the information that Boeing, Navistar Intl. (formerly International Harvester), and two others are among the large number of corporations that pay more to lobby the government than they pay in taxes.

All four Ilinois miscreants are headquartered in Chicago.  Caterpillar, Inc. is NOT on the list, thankfully.

The report, linked to below, is a good one, with suggestions on how to stop this craziness.  And it doesn't take an  amendment to the US Constitution.

Those Illinois corporations should not get one more dime in tax money until they reform their ways. Here the news release: 

Thirty Fortune 500 Companies Paid More to Lobby Congress than they Did in Federal Income Taxes

Four of the thirty are headquartered in Illinois

Chicago – With the second anniversary of the Supreme Court’s decision in the Citizens United case approaching – which opened the floodgates to corporate spending on elections – Illinois PIRG and Citizens for Tax Justice reveal thirty corporations that spent more to lobby Congress than they did in taxes.

 

The analysis, Representation without Taxation: Fortune 500 Companies that Spend Big on Lobbying and Avoid Taxes takes a close look at one area where corporate power and influence is on full display: corporate tax policy. By exploiting loopholes and special provisions in the tax code, 280 consistently profitable Fortune 500 companies paid about half the statutory corporate tax rate while spending $2 billion to lobby Congress on tax policy and other issues from 2008-2010.

 

“The fact that so many corporations can spend more money lobbying than they pay in taxes makes a mockery of our tax code and our democracy,” said Kevin O’Connor, campaign coordinator with Illinois PIRG.

 

The “Dirty Thirty” are particularly aggressive tax avoiders that spent more on federal lobbying than income taxes between 2008 and 2010. Twenty-nine of these corporations actually received a net tax rebate during the three year period of the study, and four of them are headquartered right here in Illinois.

 

Boeing, Integrys Energy Group, Baxter International, Navistar International and the rest of the companies in the ‘Dirty Thirty’ all told made $163.7 billion in profits while paying zero dollars in federal income taxes and collected a total of $10.6 billion in various tax rebates. Meanwhile, they collectively spent $475.7 million in lobbying expenses for the three year period.

 

“If we are to believe that corporations are people, shouldn’t they pay taxes just like the rest of us?” asked Rey Lopez-Calderon, Executive Director of Common Cause Illinois. “It’s a sad day in America when our government gives corporations carte blanche to purchase our elections and elected officials while shielding them from any sort of ‘personal’ responsibility.”

 

“When corporations don’t pay, the rest of us are forced to shoulder the extra burden through higher taxes, fewer services, or a larger share of the debt,” said O’Connor. “With our country facing tough budget choices, and funding for public priorities like Pell Grants and public transportation on the chopping block, it is all the more outrageous that corporations are able to shirk their tax burden by gaming the system.”

The report also takes a deeper look at one of the most egregious ways corporations skirt taxes – by shifting profits legitimately earned in America to offshore tax havens, where they are subject to little, if any taxes. At least 22 of the thirty companies studied had subsidiaries in tax haven countries.

 

The full report can be found here: https://www.illinoispirg.org/home/reports/report-archives/more-reports/more-reports/representation-without-taxation-fortune-500-companies-that-spend-big-on-lobbying-and-avoid-taxes

 

 

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The Illinois Public Interest Research Group (Illinois PIRG) is a non-profit, citizen funded watchdog and advocacy organization