Marco Rubio: Tax Bill ‘Probably Went Too Far’ On Corporate Handouts | HuffPost

[Senator Marco] Rubio expressed his reservations [about the Tax Legislation] in an interview with southwest Florida’s News-Press Thursday, noting he thinks Republicans probably gave corporations too much of a handout.“<P><P>If I were king for a day, this tax bill would have looked different,” he said. “I thought we probably went too far on [helping] corporations.”The senator believes the bill ― which is projected to add $1.4 trillion to the deficit over the next decade unless it can offset those losses via economic growth ― probably won’t result in multinational corporations investing their sudden windfall in hiring and expanding.Instead, it’s more likely to line the pockets of their shareholders.“<P><P><P>By and large, you’re going to see a lot of these multinationals buy back shares to drive up the price,” Rubio predicted. “Some of them will be forced, because they’re sitting on historic levels of cash, to pay out dividends to shareholders.  “That isn’t going to create dramatic economic growth.”

Source: Marco Rubio: Tax Bill ‘Probably Went Too Far’ On Corporate Handouts | HuffPost

This is What Would Happen if We Rolled Back Regulations to the 1960’s | HuffPost

VEA Vice Chair Nell Minow responds to President Trump’s initiative to roll back federal regulations to the 1960’s.

I’m a passionate supporter of the free market, an entrepreneur who has helped start four successful companies, and an advocate for shareholders as the foundation of capitalism. But there are some things the free market cannot do and some problems the market cannot fix. Only the government can resolve an issue if the obstacle to optimal solutions is collective choice, externalizing costs, or informational asymmetry. What that means, for example, is that the free market will never solve the problem of a manufacturer dumping toxic chemicals into the lake the community uses for water, fishing, and swimming or the air the community uses for breathing because there is no way, absent government involvement, to make the company pay for the damage it causes.

Source: This is What Would Happen if We Rolled Back Regulations to the 1960’s | HuffPost

How big oil is tightening its grip on Donald Trump’s White House | Environment | The Guardian

API has gone beyond the lobbying typical of trade associations, helping spawn permanent substructures within the executive branch that ensure its voice is heard. These government entities, which include the petroleum council and an obscure but powerful White House office, have for decades worked in tandem with API to fortify the oil and gas industry, often, its critics say, at the public’s expense.

API’s history on climate issues goes back farther than most realize. As early as 1959, it grappled with global warming, hosting a conference where the looming, manmade catastrophe was discussed. As the environmental movement was blossoming, API – with the government’s support – was working behind the scenes to undermine it by distorting projections of regulatory costs. An enduring false narrative was constructed: the economy or the environment.

For nearly a century, API has enjoyed special access to the executive branch, furtively shaping policy from the inside. Now, under Donald Trump, the industry smells victory on multiple fronts with a White House that openly detests regulation as much as it does. Days before Trump’s inauguration, API president Jack Gerard heralded the “once-in-a-generation opportunity” to reshape energy policy.

Fifty-two environmental rules have since been overturned or are in the process of being rolled back. API has publicly supported at least 23 of these actions. In May, the institute also sent a 25-page wish list to the US Environmental Protection Agency. Among the items it wants reconsidered: tougher standards for ozone – the main ingredient in smog – and regulation of methane, a greenhouse gas that is far more potent than carbon dioxide.

Source: How big oil is tightening its grip on Donald Trump’s White House | Environment | The Guardian

Corporate Tax Cuts Don’t Create Jobs, They Enrich CEOs | The Nation

Though congressional Republicans and the White House rarely see eye-to-eye these days, they are united on the idea that cutting corporate taxes will spur an hiring boom that will reach down to the ordinary worker.

A new report from the Institute for Policy Studies shows this isn’t true. US companies are already paying minimal amounts in corporate taxes, and the ones most likely under Republican theory to pour tax savings into job creation have instead been more likely to cut their workforce over the past nine years. The data shows that low corporate tax rates more often lead to increases in CEO pay and boosts for shareholders.

Before breaking down the report, it’s important to recognize that the 35 percent US corporate tax rate doesn’t reflect what corporations actually pay. The average effective corporate tax rate in the United States, once deductions are factored in, is around 27 percent, putting it below the global average. If you limit the review to profitable corporations, the number drops to 19.4 percent. Corporate taxes as a share of GDP have fallen threefold since 1952, from 6 percent to 2 percent. Far from being overtaxed, corporations have carried an increasingly lighter burden.Corporations avoid the full rate because of loopholes. There are deductions for domestic manufacturing and “bonus depreciation,” which allows immediate write-offs for half the cost of long-term investments. And corporations benefit tremendously from stashing profits overseas, thereby avoiding taxation entirely. These trillions of dollars in “offshore” profits aren’t sitting in a locker in Zurich; they’re invested in instruments like US Treasury bonds. In other words, the government pays corporations for their own tax avoidance.

The IPS report identifies 92 corporations that reported a profit every year from 2008 to 2015, and that also paid less than 20 percent in corporate income tax. These corporate winners include the usual suspects—banks, defense contractors, telecom firms, and energy companies. Because they were profitable, and paid taxes at or below the Republicans’ optimal rate, they offer an excellent test case. “If claims about the job creation benefits of lower tax rates had any validity,” report author Sarah Anderson writes, “the 92 consistently profitable tax-dodging firms we identified would be among the nation’s strongest job creators.”

But the lower rates didn’t correspond to job creation. Collectively, the 92 profitable corporations cut jobs by 0.74 percent over the period studied, from 2008–16. During that same time, the private sector added jobs at a 6 percent clip. So low-tax corporations did far worse on hiring than their counterparts.

Source: Corporate Tax Cuts Don’t Create Jobs, They Enrich CEOs | The Nation

Campaign urges U.S. public pension funds to divest from owner of Trump hotel

Advocacy groups launched petitions and sent letters on Wednesday urging two of the biggest U.S. public pension funds to divest from an investment fund unless it stops paying one of President Donald Trump’s companies to run a New York hotel.<P><P>Reuters reported on April 26 that public pension funds in at least seven U.S. states periodically send millions of dollars to an investment fund that owns the upscale Trump SoHo Hotel and Condominium in New York City and pays a Trump company to run it, according to a Reuters review of public records.

Source: Campaign urges U.S. public pension funds to divest from owner of Trump hotel

WSJ CFO Network, Washington 2017

The Wall Street Journal’s CFO Network gathering is always engaging and informative. This year VEA Vice Chair Nell Minow attended to appear at breakout sessions on board effectiveness and shareholder activism, and reported back on what she learned:

The speakers included Senators John McCain on national security (he said his biggest fears are North Korea and Russia) and Elizabeth Warren (she noted pointedly that there is widespread support, even among Trump voters for maintaining or expanding the Consumer Financial Protection Bureau and cited the President’s often-claimed enthusiasm for breaking up the TBTF financial institutions), Chairman of the House Ways and Means Committee Kevin Brady (he insists that major tax reform, including filing on a postcard for most individuals, is going to happen), and Ranking Member Adam Schiff of the House Permanent Select Committee (he supports an independent investigation into Russian interference with the democratic process).

A presentation on the prospects for financial regulation/deregulation included former SEC Chairman Harvey Pitt and former Commissioner Paul Atkins. Atkins referred to Dodd-Frank as “mostly rubbish…littered with all sorts of gimmies to unions, trial lawyers, and activists,” mentioning the conflict mineral and pay ratio disclosures as examples. He and Pitt emphasized the importance of making sure the investors get material information and are not overwhelmed with data. They insisted that the new administration will bring tough cases. Since fines are paid by the shareholders, they suggested that they do not impose a meaningful penalty. Pitt recommended outsourcing audits of investment managers and broker-dealers, using the Commission’s authority to exempt issuers from regulatory burdens, and experimenting with pilot programs to test regulatory ideas. Another possibly experiment: summary disclosures with hyperlinks providing more information, to assess the way users access the data. Atkins said, “You read through this stuff and most of it is kind of baloney.”

Why Corporations Are Helping Donald Trump Lie About Jobs – The New York Times

In an usually sharp statement, the New York Times editorial board took on corporate executives for allowing President-Elect Donald Trump to take credit for creating or saving jobs when either they were not created or saved or he had nothing to do with creating or saving them.

[C]ompanies like Sprint seem perfectly happy to go along with this fiction because they know they can profit handsomely by cozying up to Mr. Trump.

The Times notes that these executives all have matters before the federal government that they hope to be resolved favorably, at least favorably for their own interests if not the interests of investors, employees, customers, or the community.