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Not that very many people with any common sense really believe that cutting taxes on corporations and the wealthy would really jump-start the North Carolina economy, but here’s some additional info that places this patently absurd idea in its proper light.

As reported today by Travis Waldron at Think Progress:

“Even as American corporations are raking in record profits, the largest among them are shifting larger amounts of money away from the United States and into offshore tax havens that allow them to pad their bottom lines even more, according to multiple analyses of legal filings made since the beginning of 2013.

The Wall Street Journal found that the 60 largest companies moved $166 billion offshore in 2012, shielding 40 percent of their earnings from American taxes and costing the U.S. billions in lost revenue.”

Got it? The problem is not lack corporate profitability; it’s lack of demand from cash-strapped, debt-strapped consumers. Generally speaking, businesses generally have plenty to invest, but are holding back or squirreling money away because they don’t perceive a demand for the products and services they might produce. Cutting taxes and public spending further just perpetuates the vicious and destructive cycle in which we are already stuck.

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Not that you were likely losing any sleep about the well-being of the plutocrats running the American economy, but just in case you were wondering,  Think Progress reports this morning that  the Wall Street types are in the money again.

“2012 was the second most profitable year in Wall Street’s history, with banks making north of $140 billion. Wall Street’s bonus pool, while not yet back to the heights it achieved before the financial crisis, is growing again, and the average cash bonus hit $121,900.

This is part and parcel of a longer trend on Wall Street, which has seen pay skyrocket as the financial industry was deregulated. According to Bloomberg News, Wall Street’s bonus pool has nearly quintupled since 1985, growing from $4 billion to more than $20 billion (in constant dollars).”

Read and weep at the whole story by clicking here

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Food-Twinkies No MoreThere have been a number of stories in recent days implying that the demise of Hostess was somehow the result of unreasonable demands from workers. Here, however, are a couple of stories that debunk that narrative.

In the first (“No cupcake: Workers turn down bad deal from Hostess”), Dean Baker at the Center on Economic and Policy Research points out that the management team with whom the workers were attempting to negotiate were basically a bunch of predatory knuckleheads.

In the second (“Hostess blames union for bankruptcy after tripling CEO’s pay”), the folks at Think Progress provide more disturbing details.

 

 

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In case you missed it amongst all the debate hubbub, another modern day robber baron cashed out yesterday. According to the folks at Think Progress:

“Citigroup CEO Vikram Pandit abruptly resigned today, leaving the helm of the bank that he guided through the financial crisis of 2008. For his five years of leading Citi, Pandit will receive compensation in the neighborhood of $260 million.”

Not that he did much to earn it. As the article also notes:

“Overall, Citi lost 88 percent of its value under Pandit. Earlier this year, the Wall Street Journal dinged Pandit for having the pay package that was most detached from his company’s performance, as a three-year decline of 27 percent coincided with his making $43 million.”

Ah, the genius of the “free” market…

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In anticipation of Big Business Day, er uh,  Labor Day, the good people at the National Employment Law Project are out with a new report that shines some welcome light on a much undereported subject in modern America: the huge and growing profits of low wage employers.

This is from the release that acccompanied the report:

“America’s low-wage economy is marked by two extremes.  On the one hand, workers earning at or near the minimum wage are seeing the real value of their paychecks diminish steadily over time, as the cost of living increases while their wages remain stagnant.  After nearly half a century of neglect, today’s federal minimum wage of $7.25 per hour is decades out of date.  In terms of purchasing power, its value is 30 percent lower today than it was in 1968.

On the other hand, many corporations are posting record-breaking profits. Read More