Ordinary citizens are examining corporations with a big magnifying glass, and what they're seeing isn't pretty, especially when contrasted with demands that citizens surrender some of their most sacred social programs. Simply put, they are extremely pissed off.
One of the newest vehicles for their outrage is US Uncut, a group that arose specifically to protest the two-tier system that demands endless sacrifice from the majority as it facilitates corporate theft.
Early this year, British journalist Johann Hari wrote a Nation article, “The UK's Left-Wing Tea Party,” in which he detailed the sudden and impressive emergence of UK Uncut, a British movement formed to curb corporate tax dodging. Hari's wish was for the cause to cross the pond and take root in America. That took about a month. Carl Gibson from Mississippi read Hari's article and immediately felt inspired to launch US Uncut. Overnight franchises sprang up across the country.
The anti-corporate tax-dodging movement has seen its ranks expand dramatically in the past few months. In March, more than 40 chapters participated in a US Uncut day of action. Almost a month later, on Tax Day, more than 100 chapters protested corporate tax dodging.
|FACT CHECK: BANK OF AMERICA|
|On April 15, members of US Uncut protested in front of the Bank of America in downtown New Haven. They blasted the country's (and Connecticut's) biggest bank for not paying federal taxes in 2010. “I pay, You pay, Why doesn't BofA?” read one of the placards. BOA's regional spokesman, T.J. Crawford, told the New Haven Independent that the bank paid $2 billion in state and local taxes across the country. “These individuals are entitled to their opinion, but not to their own set of facts,” Crawford said of the protesters. But in fact BOA paid only $158 million in state and local taxes in 2010, according to filings with the Securities and Exchange Commission. Banks aren't required to report taxes by state, but do the math: That's slightly more than $3 million per state from the country's fifth-largest firm in terms of total revenue. In 2009, it paid $555 million in state and local taxes, but what it got back in federal refunds ($3.6 billion) wiped out that debt as well as its overseas tax liabilities, making it so that BOA effectively paid no taxes on any level in any place on planet Earth two years ago. —John Stoehr|
US Uncut's impressive growth is thanks in large part to the nationwide budget-cut backlash. The group believes that instead of asking ordinary people to sacrifice, the government should first demand that corporations pay their fair share in taxes and put an end to tax havens, which rob the U.S. of $100 billion every year.
US Uncut's main targets include Verizon, Bank of America, FedEx, General Electric and BP. Verizon made nearly $12 billion in pretax earnings last year but has paid no federal income taxes for two years. However, the company did spend more than $34 million on lobbying during that time.
Another target of US Uncut is GE, America's largest firm, which hasn't paid a nickel in federal income taxes last year — and will actually receive a $3.2 billion tax credit. Meanwhile, Bank of America paid nothing in federal taxes last year and got nearly $1 billion from taxpayers — not counting the $45 billion it received during the bailout. And the list goes on.
In fact, two-thirds of corporations in America don't pay any federal income taxes, according to a 2008 Government Accountability Office report. Corporations skirt this messy issue by saying that while they don't pay federal taxes, they pay heaps in state and local taxes — a claim that is frequently untrue.
According to an analysis of Intel Corporation's 2010 financial statements by Philip Mattera, research director of Good Jobs First, the company paid just $51 million in state and local taxes (less than 1 percent of its $13.9 billion in pretax income). In the previous two years, Intel reported negative amounts. At the same time, the company aggressively sought subsidy deals and preferential tax treatment. Intel “has received hundreds of millions of dollars in property tax abatements and sales tax exemptions in states such as Arizona, New Mexico and Oregon,” Mattera notes.
Last year, Boeing got a tax refund of $137 million from state and local governments even as it earned more than $4 billion in pretax profits, according to Mattera. The company is well-known for its thuggish tactics when negotiating with Washington State. In 2003 it made it clear that if the state did not provide a 20-year, $3.2 billion package of tax credits, it would build its new Dreamliner aircraft elsewhere. The state conceded — but when it came time for Boeing to open a second production line in 2009, the company went to South Carolina, which offered a staggering $900 billion subsidy package. (The National Labor Relations Board ruled that this was illegal retaliation and ordered the company to shift production to Washington.)
Corporations are paying fewer taxes than ever (see our cover story for more). Corporate income tax payments made up only 5.4 percent of total state tax collections last year, down from 10 percent in 1980, according to the Census. “Somebody is gaming the system,” Gibson says.
Those “somebodies” lobby Washington to rig the game in their favor. It is because of this two-tier system that US Uncut's movement continues to grow. The group comprises many young people who are fairly new to the world of activism.
Kevin Shields, founder of US Uncut Philadelphia, is a senior in high school. “If you don't do [activism],” he says, “you're really missing out, and you're participating in your own exploitation.”
A slightly different version of this article originally appeared in The Nation.