Last week, the New York Times reported that General Electric (GE), the world’s largest corporation paid nothing in federal corporate income taxes in 2010. In fact, the company made over $14 billion in profits and actually received a $3.2 billion tax benefit.
Yesterday, Rep. Jim McDermott (D-WA) spoke at a CAP event titled “Measuring Our Progress in Reducing U.S. Poverty,” where he discussed adequate benchmarks for measuring poverty in the United States. He sat down with ThinkProgress for an interview, where we asked him about GE’s corporate tax dodging. The congressman told us that it’s absolutely irritating that a company as rich as GE could be paying less in taxes than a secretary at our workplace, the Center for American Progress:
THINKPROGRESS: Congressman, last week we saw a front page New York Times story about General Electric, which is the largest corporation in our country, it actually didn’t pay anything, in taxes, it actually received billions of dollars in tax benefits — MCDERMOTT: $3.2 billion —
THINKPROGRESS: Yes, 3.2 billion, exactly. Don’t you see a contradiction here between asking low-income people, middle-income people, working class people, students, paying with their services and benefits, while big corporations like this are getting away with nothing or even getting benefits? […]
MCDERMOTT: Everybody in a civilized society should pay their fair share, according to their ability to pay. You don’t expect poor people to pay half their salary for the society in which they live. But this society lives, and people make money in it and do very well in it because we’ve created this society. And it costs money to do that. And for General Electric to fool around and not pay anything, that’s where the Alternative Minimum Tax came from, a long time ago. Because it’s absolutely irritating that General Electric pays less than the secretary at the front desk of this agency, this organization. It is simply not fair.
The Daily Show’s Jon Stewart has been repeatedly skewering GE for its tax avoidance. On Monday, Stewart asked rhetorically, “I thought the corporate tax rate needed to be lower. How can you lower it from nothing?” The Washington Post — echoing reporting by ThinkProgress — notes that the story of GE’s taxes has been “conspicuously absent from the reportage of one news organization: NBC [which is owned by GE].”
Unfortunately, GE is not alone in its tax avoidance. It joins Bank of America, Citigroup, ExxonMobil, Wells Fargo, Boeing, and many other major corporations have gone quarters or or entire years without paying any federal corporate income taxes. That’s part of the reason that there is a Main Street Movement erupted across America demanding fair sacrifice that doesn’t shoulder the burdens of an economic crisis on those who didn’t cause it.
Citing GE CEO Jeff Immelt’s growing compensation, Russ Feingold’s Progressives United is running a campaign calling on Immelt to step down from his chairmanship of President Obama’s Council on Jobs and Competitiveness. MoveOn is also running a campaign with the same demand.