The New York Times reported today that General Electric’s effective tax rate in 2010 was zero. Despite making $14.2 billion in profits, the company received $3.2 billion in tax benefits. GE is able to drive down its effective tax rate via “an aggressive strategy that mixes fierce lobbying for tax breaks and innovative accounting that enables it to concentrate its profits offshore.”

The fact that hugely profitable companies receive billions in benefits from taxpayers clearly makes the case for ending giveaways in the corporate tax code and cracking down on companies that use tax havens to shelter income overseas. However, Sen. Ron Johnson (R-WI), when asked about GE’s zero percent tax rate today on CNBC, replied that the real problem is the U.S. corporate tax rate is too high:

We have to be concerned about what the business environment is in the U.S. here. We can’t afford to have the highest tax rate in the world…Those are individual companies. I think overall, we really can’t be looking at a corporate tax rate much higher than 25 percent because that’s the world average. So we’re sitting up there at 35 percent, that’s just the wrong signal.

Watch it:

Needless to say, reducing the corporate tax rate to 25 percent without cutting down on loopholes, giveaways, and tax avoidance wouldn’t change much for companies that already pay nothing. And GE is hardly alone in this regard: Boeing, Bank of America, and ExxonMobil have all paid no taxes into the U.S. Treasury in recent years.

But Republicans had much the same reaction when Bloomberg blew the lid off of Google’s elaborate scheme to lower its tax rate all the way down to 2.4 percent. “I don’t know the individual facts of the Google situation. What I do know is that, second only to Japan, we have the highest corporate income tax rate of any industrialized nation of the world,” said Rep. Jeb Hensarling (R-TX).

U.S. corporate tax revenue has plunged to a historical low and corporate tax receipts here are less than they are in other developed countries. Particularly with the U.S. facing a long-term problem with its structural deficit, corporate tax reform should involve clearing the corporate tax code of its myriad loopholes and giveaways and raising additional revenue, so that the tax burden is not shifted onto small businesses and the middle-class.

On its front page this morning, the New York Times reported that General Electric — the world’s largest company — made $14.2 billion in profits ($5.1 billion in America) and managed to not pay a dime in federal taxes. In fact, the company actually received “a tax benefit of $3.2 billion.”

The mega corporation’s tax dodging flies in the face of the rhetoric of its CEO Jeffery Immelt — also the head of President Obama’s Council on Jobs and Competitiveness — who sought to portray his company as one that values fairness in a speech at West Point in 2009.

In that speech, titled “Renewing American Leadership,” Immelt stood before hundreds of military cadets — who enlisted in the military and were willing to sacrifice everything for their country — and complimented the military audience for its heroism while blasting the greedy culture of big business:

Few of us will ever do what many of you will do for duty, honor and country. But America doesn’t expect heroism from all of us. [...] Wherever our talents lie, and whenever our conscience requires, we must all, to the best of our abilities, help keep America the great face for good it has long been. We are trying to do that at GE. [...]

I think we are at the end of a difficult generation of business leadership, and maybe leadership in general. Tough-mindedness, a good trait – was replaced by meanness and greed – both terrible traits. Rewards became perverted. The richest people made the most mistakes with the least accountability.

At the same time, ethically, leaders do share a common responsibility to narrow the gap between the weak and the strong. [...] What I can bring … what GE can bring … are investments, training and operating approaches to help everyone win.

Immelt won wide praise for his speech at the time. The Huffington Post wrote that he “has come clean about the financial crisis” in a “remarkably candid” speech. The Financial Times said that it was “one of the strongest criticisms” yet made by a major US CEO of business practices.

It appears that Immelt has fallen short of his lofty rhetoric during the West Point speech. Far from making the sort of sacrifices he was honoring at that speech, GE appears to be exploiting loopholes in the tax code to shirk its responsibilities — one of which would be paying its taxes to maintain the military the cadets in the audience were a part of. The behavior of his company matches that of Bank of America, Citigroup, ExxonMobil, and other companies that have gone quarters or entire years while not paying a penny in federal corporate income taxes.

When Texas Gov. Rick Perry (R) gave his annual state address, he promised that his plan to fill the Lone Star state’s $27 billion budget gap without raising any new revenue would lead to economic prosperity and job growth. “Balancing our budget without raising taxes will keep us moving forward out of these tough economic times, creating more jobs and opportunity and leaving Texas more competitive than ever,” he said. “As other states flounder about, oppressing their citizens with more taxes and driving away jobs with bad policy, Texas will make the right decisions, and emerge stronger.”

However, the bipartisan Legislative Budget Board found that the budget before the legislature could cause the state to lose 600,000 jobs, including more than 260,000 in the private sector:

Texas could see more than 600,000 jobs disappear if lawmakers adopt the $83.8 billion budget that will go before the state House late next week, according to a state agency. Harsh spending cuts in the budget could cost more than 263,500 private sector jobs and 343,000 government positions over the next two years, according to estimates released Wednesday by the Legislative Budget Board, a bipartisan committee.

The Budget Board emphasized that “many of these job losses can be attributed to the steep downturn of the Texas economy during the past several years.” This just reaffirms the folly of instituting draconian budget cuts at a time of economic weakness. “The voters did not elect us to eliminate hundreds of thousands of jobs,” said state Rep. Mike Villarreal (D).

The cuts in the Texas budget fall especially hard on the state’s already hard-hit education and health care sectors. Earlier this month, Perry was talking up the virtues of education and job creation at the same time that he was proposing deep education cuts and teacher layoffs.

700 of the positions that the Texas budget would eliminate would be in child protective services. Texas already has a sky-high child poverty rate and as Prof. Vivian Dorsett explained, “if you cut child services on the front end, then the state’s going to be paying for it on the back end,” due to foster care and prison costs.