EX-IM Bank -- "General Electric's Twisted Knot"
Posted by robgambrill 8 years, 7 months ago to Business
Some notes on the "Crony Capitalism" problem specifically as it relates to GE. Sorry this is so long, but the story is rather convoluted.
General Electric is claiming that they are moving 500 turbine manufacturing jobs to France because the house won't reauthorize the ex-im bank. France is however willing to back loans for GE, in exchange for moving turbine production to France. Now it looks like the jobs they are moving don't actually exist (yet).
Well, they got a french government backed deal, so GE is making a business decision moving(?) turbine production to Europe . Can't fault them there if they can make more money. They do appear to be making some political hay out of the deal though.
Now GE, has over 2 billion in profits that are being held overseas. They can't bring them home because of the high corporate tax rates in the US. Can't really blame GE for that either, the corporate rate is way too high.
However, with all the tax loop holes, GE does not pay the full corporate rate as it is. In some recent years, GE got a tax rebate. Smaller (less well connected) businesses don't often get that deal. I can't bring myself to feel sorry for General Electric.
They do seem to think that taxpayers should back loans on GE products sold overseas though.
Uh, couldn't (and shouldn't) GE be expected to take up the risk themselves if these deals are critical to their business, or simply pass on the deals if they are that risky? Really now, are they hurting so bad that they need taxpayer assistance to stay in business?
Now it is not like GE is adverse to spending money at home. They are one of the biggest contributors to incumbent political campaigns in the US.
Well, businesses need their "guy" in DC. I can't fault them for trying to get politicians on their side. But "their side" seems to involve backing all incumbents from both parties, both democrats and republicans. For some reason, they deem it necessary to back the status quo.
If you are a conservative, you know what happened when Chris McDaniel, Matt Bevin and Milton Wolf tried to run against sitting RINOs in the primaries. They got squashed.
GE made large contributions to the campaigns of Mitch McConnell, Pat Roberts and Tad Cochren. They also gave money to the National Rebulican Senate Commitee. They are willing to fight to keep things just the way they are. Government reform is just not something they are interested in.
I think I could not be faulted by saying that, at the very least, General Electric appears to be acting without integrity. Not sure what people concerned about "fixing" the system can do about it.
If you think "there ought to be a law", you are probably reading the wrong forum. Tax reform to remove loopholes would get there attention, but they seem to have both sides "in their pocket". I don't think an "Occupy Wall Street" type protest or boycott would hurt them much, GE is multinational and pretty darn big.
You could buy stock and complain about them blowing money, but they have over 250 million shares outstanding. Even if 10,000 conservatives bought a hundred shares each (a million total), it would be a mere squeak in the board room. Internal reform could be a long slog.
Next time I "have" to deal with a GE sales rep, I am going to state the following. "You don't pay much in taxes, and you got money enough to throw around to the politicians, so I think you should give me a MUCH better deal than what you are offering". If customers start haggling enough so that it makes it up the chain in sales meetings, they might have enough of an incentive to knock it off. The only other option is to not do business with them at all, that would be possible in certain situations.
Do you objectivists have any ideas on how to be "pro-business" and contend with corporate "bad actors" at the same time? Should we try to engage them, or simply walk away whenever feasable?
http://www.nbcnews.com/business/busin...
http://www.washingtonexaminer.com/gen...
https://www.opensecrets.org/orgs/summ...
https://en.wikipedia.org/wiki/General...
General Electric is claiming that they are moving 500 turbine manufacturing jobs to France because the house won't reauthorize the ex-im bank. France is however willing to back loans for GE, in exchange for moving turbine production to France. Now it looks like the jobs they are moving don't actually exist (yet).
Well, they got a french government backed deal, so GE is making a business decision moving(?) turbine production to Europe . Can't fault them there if they can make more money. They do appear to be making some political hay out of the deal though.
Now GE, has over 2 billion in profits that are being held overseas. They can't bring them home because of the high corporate tax rates in the US. Can't really blame GE for that either, the corporate rate is way too high.
However, with all the tax loop holes, GE does not pay the full corporate rate as it is. In some recent years, GE got a tax rebate. Smaller (less well connected) businesses don't often get that deal. I can't bring myself to feel sorry for General Electric.
They do seem to think that taxpayers should back loans on GE products sold overseas though.
Uh, couldn't (and shouldn't) GE be expected to take up the risk themselves if these deals are critical to their business, or simply pass on the deals if they are that risky? Really now, are they hurting so bad that they need taxpayer assistance to stay in business?
Now it is not like GE is adverse to spending money at home. They are one of the biggest contributors to incumbent political campaigns in the US.
Well, businesses need their "guy" in DC. I can't fault them for trying to get politicians on their side. But "their side" seems to involve backing all incumbents from both parties, both democrats and republicans. For some reason, they deem it necessary to back the status quo.
If you are a conservative, you know what happened when Chris McDaniel, Matt Bevin and Milton Wolf tried to run against sitting RINOs in the primaries. They got squashed.
GE made large contributions to the campaigns of Mitch McConnell, Pat Roberts and Tad Cochren. They also gave money to the National Rebulican Senate Commitee. They are willing to fight to keep things just the way they are. Government reform is just not something they are interested in.
I think I could not be faulted by saying that, at the very least, General Electric appears to be acting without integrity. Not sure what people concerned about "fixing" the system can do about it.
If you think "there ought to be a law", you are probably reading the wrong forum. Tax reform to remove loopholes would get there attention, but they seem to have both sides "in their pocket". I don't think an "Occupy Wall Street" type protest or boycott would hurt them much, GE is multinational and pretty darn big.
You could buy stock and complain about them blowing money, but they have over 250 million shares outstanding. Even if 10,000 conservatives bought a hundred shares each (a million total), it would be a mere squeak in the board room. Internal reform could be a long slog.
Next time I "have" to deal with a GE sales rep, I am going to state the following. "You don't pay much in taxes, and you got money enough to throw around to the politicians, so I think you should give me a MUCH better deal than what you are offering". If customers start haggling enough so that it makes it up the chain in sales meetings, they might have enough of an incentive to knock it off. The only other option is to not do business with them at all, that would be possible in certain situations.
Do you objectivists have any ideas on how to be "pro-business" and contend with corporate "bad actors" at the same time? Should we try to engage them, or simply walk away whenever feasable?
http://www.nbcnews.com/business/busin...
http://www.washingtonexaminer.com/gen...
https://www.opensecrets.org/orgs/summ...
https://en.wikipedia.org/wiki/General...
The system is designed to siphon assets from the people to support companies large enough to bribe politicians using campaign donations. Innovation is stifled as is competition to large donors.
GE benefits; GM benefits; Morgan Chase benefits; all their competitors and potential competitors are robbed.
Looks like Boeing is a contributor to both parties incumbent senators in my state. Yet another example of corporations protecting the status quo in exchange for favors.
I think business should have the right to influence government policy. What bothers me is when they use their influence to get their special perks.
I don't see an easy way to put a stop to this. What can you say, Who is John Galt?
In the case of GE, that could be hard for the average company or individual. Don't buy their thermoplastics, don't ride on planes with their jet engines, turn off the lights so you don't use their power plants, and don't get sick and go to the hospital. GE is kind of hard to avoid.
But like your better students, when given a choice, I think the proper course of action is just to steer clear of companies who behave like that.