Hundreds of Google’s own employees have spoken out against this controversial contract, which provides advanced technology that will be used to further oppress and harm millions of Palestinians
Today, for the first time in company history, Google shareholders like me voted on a resolution that calls into question a contract with the Israeli government and military known as Project Nimbus. Hundreds of Google's own employees have spoken out against this controversial contract, which provides advanced technology that will be used to further oppress and harm millions of Palestinians. Through its Project Nimbus contract, Google provides cloud services to the Israeli army, making it easier for Israel to surveille and oppress Palestinians. Shareholder resolutions have become an important tool for demanding ethical business practices in boardrooms. The resolution asks that Google and parent company Alphabet evaluate the harm caused by contracts with institutions that have violated human rights, like the Israeli military, US Immigration and Customs Enforcement (ICE), and US Customs and Border Protection (CBP). These contentious deals lead people to rightfully ask why a company that creates products we all know and rely on every day would also create and supply products to institutions that violate people's basic human rights. For years, prominent human rights organizations have raised alarms about Israel's brutal oppression of Palestinians. There is now a near-total consensus among the United Nations and all major human rights organizations, including Amnesty International, Human Rights Watch, and Israel's leading human rights organization B'Tselem, that Israel's discriminatory policies and practices against Palestinians amounts to the serious crime of apartheid. Through its Project Nimbus contract, Google provides cloud services to the Israeli army, making it easier for Israel to surveille and oppress Palestinians. The contract also provides data support to the Israel Land Authority (ILA), which according to Human Rights Watch, uses discriminatory policies to expand illegal Israeli settlements on Palestinian land where Palestinians aren't allowed to live. Google has had incredible success recruiting a diverse workforce, and they should be embracing employees who want to make the company better. The company may have difficulties retaining talent if it pursues contracts that run contrary to Google's stated corporate values that attracted employees to the company in the first place. In May of last year, 250 Jewish employees at Google urged the company to support Palestinian rights and end its ties with the Israeli military, and nearly 700 Google employees signed a petition rejecting the Project Nimbus contract. Google aspires to value democracy, accountability, and safety, and rightfully says that companies "can make money without doing evil." But as tech evolves and becomes more pervasive in almost every aspect of our lives, there is a growing awareness of the threat it can pose to human rights. Google has canceled these kinds of contracts before and it should reverse its contract with the Israeli military too. After public backlash over a contract with the US military, Google outlined new ethical principles for its use of artificial technology (AI), including a commitment not to use AI for weapons or surveillance, particularly in cases where there is a violation of "internationally accepted norms." Given the outcry from human rights organizations over Israel's system of apartheid, the Project Nimbus contract sharply conflicts with Google's stated ethical standards. As shareholders, we believe that Google's commitment to ethics is a good thing for society and for investors. Not only do Google's AI principles help ensure that Google technology is used to bring people together, rather than cause harm, but these ethical commitments also make Google unique amongst its competitors in a world where more and more users want companies they support to share their values. Ethical business matters. Increasingly, workers, consumers, and even investors are demanding better from corporations. Google has a choice: instead of enabling human rights abuses, it should promote technology that has a positive impact on the world. Google can and should stand on the right side of history by ending Project Nimbus.
"Noting similar efforts by Amazon and Facebook, they said the tech giant "should focus on complying with antitrust law rather than attempting to rig the system with these unseemly tactics."
U.S. Sen. Elizabeth Warren and Rep. Pramila Jayapal on Wednesday sent a letter to Google CEO Sundar Pichai demanding that the company swiftly end its "ongoing attempts to strip Assistant Attorney General Jonathan Kanter of his authority to enforce antitrust law." "These efforts to bully regulators and avoid accountability... are untethered to federal ethics law and regulations." The day after Kanter took the oath of office to lead the Antitrust Division at the Department of Justice (DOJ) in November—following a bipartisan Senate vote confirming his nomination—Google suggested in the letter to federal officials that Kanter should be recused from litigation and probes against the tech giant because he may not be "fair and impartial." Google's stance apparently has not changed. CNBC reported Wednesday that a spokesperson pointed to an earlier statement about his recusal, saying, "Mr. Kanter's past statements and work representing competitors who have advocated for the cases brought by the department raise serious concerns about his ability to be impartial." Warren (D-Mass.)—who voted to confirm Kanter—and Jayapal (D-Wash.) pushed back against Google's claims, writing that "the company's attempts to force Mr. Kanter off current and future cases are misguided and reflect what appears to be a willful misunderstanding and misrepresentation of federal ethics mandates." Echoing earlier arguments from experts, the pair laid out why Kanter's recusal isn't required under federal law: First, there is no evidence whatsoever that Mr. Kanter's work involving Google at the DOJ would affect his "financial interest." Second, Mr. Kanter has never represented either Google or the United States, the two parties that would be involved in any "particular matter" involving action by the federal government against the company. Third, although Google as a corporation with a clear financial interest in weak antitrust enforcement appears to be willing to question Mr. Kanter's impartiality, there is no basis for a reasonable person to do so given that Mr. Kanter's prior work has aligned with the federal government's interest in robust enforcement of antitrust law. Kanter, a well-known antitrust attorney whose nomination by President Joe Biden last year was welcomed as a win for workers and consumers, "is eminently qualified to lead the Department of Justice's Antitrust Division, and it is unfair and inappropriate of your company to question his impartiality," the progressive lawmakers wrote. "These efforts to bully regulators and avoid accountability—which are similar to those of Facebook and Amazon earlier this year—are untethered to federal ethics law and regulations, and we urge you to cease them immediately," they added. "Google should focus on complying with antitrust law rather than attempting to rig the system with these unseemly tactics." Jayapal and Warren, joined by Sens. Richard Blumenthal (D-Conn.) and Cory Booker (D-N.J.), similarly called out Amazon and Facebook last year for attempting to "strip Federal Trade Commission (FTC) Chair Lina Khan of her authority to enforce antitrust law." Like with Kanter, Biden's nomination and the Senate's bipartisan confirmation of Khan, an "antitrust trailblazer," were widely celebrated by critics of Big Tech hopeful that the appointees will hold companies like Amazon, Facebook, and Google accountable for alleged illegal conduct. "Google is right to fear that the company may have run afoul of federal antitrust law and that more aggressive enforcement from effective regulators could affect the company's operations and bottom line," wrote Warren and Jayapal, noting that U.S. officials "have filed a plethora of lawsuits against Google regarding alleged anti-competitive and exclusionary practices." "If Google is serious about ending conflicts of interest in Washington, it can demonstrate its sincerity by supporting legislation, like the Anti-Corruption and Public Integrity Act, to strengthen federal ethics requirements," the Democrats said, referencing a bill they jointly reintroduced in 2020. "Otherwise," they warned the Google CEO, "your efforts to sideline key federal regulators—like similar actions by Facebook and Amazon—simply serve as further evidence that you will go to all lengths to ward off necessary scrutiny of your immense market power."
"Corporate interests will say or do anything to preserve the broken status quo, including lie to families that overdue investments in child care, education, and climate change are somehow not in their interest."
Companies Vowing Climate Action Also Back Lobby Groups Trying to Kill Landmark Climate Bill "Corporate interests will say or do anything to preserve the broken status quo, including lie to families that overdue investments in child care, education, and climate change are somehow not in their interest." JULIA CONLEY October 1, 2021 A new analysis out Friday makes clear the wide gap between corporations' stated commitments to fighting the climate crisis and the lengths they are currently going to in order to stop the passage of the biggest climate action spending package in U.S. history. The research by the progressive advocacy group Accountable.US examined statements and pledges made in recent years by companies including American Airlines, Amazon, Apple, and Google regarding the corporations' plans to end carbon emissions, shift to fleets of electric vehicles, and take other steps to help combat the climate emergency. "Let's be clear: Walmart, one of the biggest companies in America, says they support the climate initiatives in the Build Back Better Plan. But the company is actively fighting its passage." —Accountable.US Those stated commitments mean little, Accountable.US said, considering the companies' close ties with lobbying firms that are actively working to kill the Build Back Better Act, the spending package which would invest $3.5 trillion over 10 years to transition towards renewable energy and bolster the wellbeing of working Americans. "Major corporations love to tell us how committed they are to addressing the climate crisis and building a sustainable future, but behind closed doors, they are funding the very industry trade groups that are fighting tooth and nail to stop the biggest climate change bill ever," Kyle Herrig, president of Accountable.US, told The Guardian. Microsoft, for example, said last year it would be carbon negative by 2030, emphasizing that "the scientific consensus is clear" about the human-caused climate emergency and the danger planet-heating carbon emissions pose to humanity. The company also unveiled a plan to establish a $1 billion climate innovation fund "to accelerate the global development of carbon reduction, capture, and removal technologies." The analysis by Accountable.US showed that despite Microsoft's claimed commitment to climate action, some of the company's executives are among the board members of the U.S. Chamber of Commerce—the largest lobbying group in the United States—which has made no secret of its goal of tanking the Build Back Better plan, which progressives hope to pass through the filibuster-proof reconciliation process. The Chamber said in August that it was prepared to "do everything we can to prevent this tax raising, job-killing reconciliation bill from becoming law." On social media, Accountable.US pointed to other examples of large corporations whose stated concerns over the climate emergency are inconsistent with their involvement with powerful lobbying groups. The group responded to a tweet from American Airlines on helping to "accelerate the technologies needed to reach net zero emissions" by pointing out that the aviation company is opposed to the reconciliation bill, which would invest in electric vehicle infrastructure, create millions of good-paying clean energy jobs, and reduce emissions from transportation, among other measures.
If we can make enough noise to break through the lobbyist facade, we can get these bills to the floor in the next few weeks, and we will win
A leading digital rights group on Wednesday kicked off a new campaign aimed at boosting federal legislation that would crack down on Big Tech monopolies. "This and next week are do-or-die for the most significant antitrust reforms in a generation." Fight for the Future's (FFF) "Antitrust Summer" campaign is betting that grassroots organizing can help win passage of S. 2992 and S. 2710, respectively the American Innovation and Choice Online Act (AICOA) and the Open App Markets Act (OAMA). "Powerful tech companies have gained way too much control over our lives. Facebook, Google, Apple, and Amazon drown us in ads, algorithmically amplify hate and extremism, copy and kill their competitors, and limit free speech," Fight for the Future said. "But this isn't our destiny," the group continued. "The internet is capable of so much more. Big Tech monopolists get away with harming us and our democracy simply because they can."
“We can’t allow our free press to be captured by tech monopolies,” warned one advocate.
Press freedom and antitrust advocates on Friday derided both Facebook and corporate media beneficiaries of the tech titan's multimillion dollar spending spree following reporting that the company is rethinking its investments amid increasing regulatory pressures and a shift away from news partnerships. "For years, Facebook has sucked advertising dollars away from newspapers and news magazines." The Wall Street Journal reports that Facebook in recent years has annually paid an average of more than $15 million to The Washington Post, as well as $20 million to The New York Times, and over $10 million to the Journal. The Journal deal is part of a larger $20 million agreement. "For years, Facebook has sucked advertising dollars away from newspapers and news magazines," Barry Lynn, executive director at the anti-monopoly watchdog group Open Markets, said in a statement. "At the very moment the U.S. government began to seek solutions to this problem, Facebook cut murky, multimillion-dollars deal with America's most influential newspapers, apparently as part of an effort to halt regulation and continue to siphon off advertising dollars unhindered," he added. According to "people familiar with the matter" interviewed by the Journal, it is not clear whether Facebook will continue its deals with media corporations as Meta, the social platform's parent company, shifts its investments from news to "products that attract creators" and the metaverse. The Journal also cites Meta CEO Mark Zuckerberg's disappointment at "regulatory efforts around the world looking to force platforms like Facebook and Alphabet Inc.'s Google to pay publishers for any news content available on their platforms." Facebook was so incensed by a 2021 Australian law compelling large online platforms to pay publishers for linking to local news stories that it temporarily imposed a blackout on Australian news outlets, a move condemned by groups including Access Now and Amnesty International. Lynn said that "it's not entirely surprising, then, to learn Facebook wants to nix these payments, which clearly haven't delivered the protection from regulation that Facebook expected." He continued: It is surprising that the public is only now learning the details of Facebook's payoffs to America's biggest newspapers, three years after the fact. Facebook should absolutely pay for the news it shares on its platform. But the American people also need complete transparency about any and all agreements between the publishers who report the news and the tech giants we expect them to cover honestly and critically. Open Markets Institute calls on news publishers to immediately disclose the amounts and terms of all their deals with Big Tech, including any renewed deals with Facebook and existing deals with Google. We can't allow our free press to be captured by tech monopolies. They already hold far too much power and pose dire threats to our democracy. Open Markets also called on the Times, Post, and Journal to "work constructively with Congress to ensure that the Journalism Competition and Preservation Act establishes a foundation for a truly fair marketplace designed to ensure robust advertising support for every newspaper in the United States, not only the few dominant players." Introduced by Sen. Amy Klobuchar (D-Minn.) in February, the proposed legislation "creates a four-year safe harbor from antitrust laws for print, broadcast, or digital news companies to collectively negotiate with online content distributors (e.g., social media companies) regarding the terms on which the news companies' content may be distributed by online content distributors." Google and Facebook have also come under fire for throttling traffic to progressive and other independent news sites, many of which are fighting to survive amid incessant corporate consolidation. "This is a classic example of the rich get richer," Jody Brannon, director of the Center for Journalism & Liberty, a program of the Open Markets Institute, said in a statement. "Facebook collects most digital ad dollars from the reporting done by local journalists, so why can't smaller newsrooms reap even fractions of those millions to better cover their communities?" The Journal report comes as the digital rights group Fight For the Future kicks off an "Antitrust Summer" campaign aimed at boosting federal legislation to crack down on Big Tech monopolies.
Changing their name doesn't change reality: Facebook is destroying our democracy and is the world's leading peddler of disinformation and hate.
Tech ethicists and branding professionals on Thursday said consumers should not be hoodwinked by Facebook's name change, which numerous observers compared to earlier efforts by tobacco and fossil fuel companies to distract attention from their societal harms. "Don't be fooled. Nothing changes here. This is just a publicity stunt hatched by Facebook's PR department to deflect attention as Zuckerberg squirms." Facebook co-founder and CEO Mark Zuckerberg announced the Meta rechristening during Facebook Connect, the company's annual virtual and augmented reality conference, explaining that "we are a company that builds technology to connect people and the metaverse is the next frontier, just like social networking was when we got started." "Some of you might be wondering why we're doing this right now," he added. "The answer is that I believe that we're put on this Earth to create. I believe that technology can make our lives better." Many critics found Zuckerberg's explanation unconvincing at best and, at worst, disingenuous. "Changing their name doesn't change reality: Facebook is destroying our democracy and is the world's leading peddler of disinformation and hate," the watchdog group Real Facebook Oversight Board said in a statement. "Their meaningless name change should not distract from the investigation, regulation, and real, independent oversight needed to hold Facebook accountable." Vahid Razavi, founder of the advocacy group Ethics in Tech, told Common Dreams: "Don't be fooled. Nothing changes here. This is just a publicity stunt hatched by Facebook's PR department to deflect attention as Zuckerberg squirms" over the negative press from recent whistleblower revelations. Former Facebook employees-turned whistleblowers say the company's profit-seeking algorithms—and its executives who know their insidious impacts—are responsible for the mass dissemination of harmful content, including hate speech and political, climate, and Covid-19 misinformation. Profits Before People: The Facebook Papers Expose Tech Giant Greed Jon Queally Siva Vaidhyanathan, a media studies professor at the University of Virginia and author of the book Antisocial Media, told Time that "the Facebook of today has never been the end game for Zuckerberg." "He's always wanted his company to be the operating system of our lives that can socially engineer how we live and what we know," Vaidhyanathan continued, adding that the new name is "not going to change his vision for his company—he's never let anybody on the outside change his mind." Zuckerberg, he said, "wants to take the dynamic of algorithmic guidance out of our phones and off of our computers and build that system into our lives and our consciousness, so our eyeglasses become our screens, and our hands become the mouse." Some observers compared Facebook's attempt to rebrand itself to what they called similar efforts by Big Tobacco and fossil fuel corporations. "It didn't do anything," Laurel Sutton, co-founder of the branding agency Catchword, told Time. "People still knew that Altria was Philip Morris and they didn't rehabilitate their reputation simply because they changed the name." "There's no name that's going to rehabilitate the behavior that they've displayed so far," Sutton said of the social media giant. "Maybe put that time and energy into rehabilitating their morals and ethics and business decisions rather than just trying to slap a new name on something."
"When you include their untaxed wealth growth in the calculation, many billionaires pay almost nothing," said Frank Clemente of Americans for Tax Fairness. JAKE JOHNSON May 19, 2022 When their astronomical wealth gains are taken into account, dozens of the top billionaires in the United States paid an average federal tax rate of just 4.8% from 2013 to 2018—a significantly lower rate than the nation's average taxpayer. "As long as we fail to tax their main source of income—the growth in their fortunes—many billionaires will continue to live largely tax-free lives." That's according to a new analysis released Thursday by Americans for Tax Fairness (ATF), a progressive group that has been tracking the explosion of billionaire wealth over the past several years, particularly during the coronavirus pandemic. Under current U.S. law, unrealized capital gains from stocks and other assets are not taxed, allowing billionaires such as Amazon executive chairman Jeff Bezos and Tesla CEO Elon Musk to accumulate massive fortunes tax-free. And even when assets are sold and gains are "realized," the long-term capital gains tax rate is significantly lower than the top marginal tax rate of 37%. Drawing on Forbes figures on billionaire wealth and recent Internal Revenue Service data leaked to ProPublica, ATF estimates that 26 of the richest people in the U.S. paid an average federal income tax rate of 4.8% between 2013 and 2018 when wealth gains are counted as income. Some prominent billionaires—including Berkshire Hathaway CEO Warren Buffett, Facebook CEO Mark Zuckerberg, and Bezos—paid tax rates of less than 2% during the six-year period, ATF found. On Twitter, ATF pointed out that the average U.S. taxpayer pays a 13.3% tax rate on their income. "Teachers, plumbers, firefighters, and other working Americans can already pay higher tax rates than billionaires—and that's just counting the small part of billionaire income that is now taxed," Frank Clemente, ATF's executive director, said in a statement. "When you include their untaxed wealth growth in the calculation, many billionaires pay almost nothing." ATF argues that it's reasonable to count billionaires' unrealized wealth gains as income because the ultra-rich can borrow against their assets, securing "low-interest loans that fund lavish lifestyles without owing income tax." "At the scale enjoyed by billionaires, growth in the value of assets—even if those assets are not sold—can be as good as money in the bank, which Elon Musk is putting to good effect in his purchase of Twitter," the group said. In October, Sen. Ron Wyden (D-Ore.)—the chair of the Senate Finance Committee—introduced legislation that would impose an annual tax on unrealized gains that the wealthy accumulate from tradable assets, a proposal that ATF has applauded. At present, the bill has no path to passage in the Senate, largely because of Sen. Joe Manchin's (D-W.Va.) opposition. "As long as we fail to tax their main source of income—the growth in their fortunes—many billionaires will continue to live largely tax-free lives," Clemente said Thursday.
"As the people who build the technologies that Microsoft profits from, we refuse to be complicit."
Corporations that contract with President Donald Trump's immigration agencies faced harsh rebuke this week both from within their ranks and from outside critics over their complicity with the Trump administration's separation of families at the U.S.-Mexico border. More than 100 employees at Microsoft demanded that the company stop providing support to Immigration and Customs Enforcement (ICE). "We request that Microsoft cancel its contracts with ICE, and with other clients who directly enable ICE," wrote the workers. "As the people who build the technologies that Microsoft profits from, we refuse to be complicit." Microsoft has previously told employees that its work with ICE does not support the Trump administration's zero tolerance immigration policy under which thousands of children have been separated from their families—packed into detention centers for children as young as a few months old or sent all over the country in the foster care system. The employees made clear that such an assurance "does not go far enough." "We believe that Microsoft must take an ethical stand, and put children and families above profits," said the employees, noting that the company has a $19.4 million contract with ICE. "We also call on Microsoft to draft, publicize and enforce a clear policy stating that neither Microsoft nor its contractors will work with clients who violate international human rights law." In January, Microsoft announced a new partnership with ICE through its Azure Government computing program. The program's capabilities include facial recognition software, leading to concerns among critics that the company could be directly participating in the apprehension of immigrants. In CEO Satya Nadella's response to his employees' letter, he said only that Microsoft is "supporting legacy mail, calendar, messaging, and document management workloads" for ICE. Regardless of the exact nature of Microsoft's work with the agency, the letter noted, the company is "providing the technical undergirding in support of an agency that is actively enforcing this inhumane policy." Meanwhile, partnerships forged by defense and intelligence contractors with the Health and Human Services Department (HHS)—which is charged with caring for children who arrive in the U.S. without adults as well as those who have been forcibly separated from their parents and guardians—have come under attack in recent days. As Common Dreams reported last week, General Dynamics and MVM, Inc. have won multi-million dollar contracts with the department to oversee the detention centers where more and more children have been sent in recent weeks, and to transport children throughout Texas. General Dynamics' involvement in the zero tolerance policy provoked condemnation from peace activists in Maine, home of the corporation's subsidiary, Bath Iron Works. "It is a real sign that [General Dynamics] is willing to do just about anything to make [money]," peace activist Bruce Gagnon told the Bangor Daily News. "Ethics do not matter to this mega-corporation at all." Organizers of the online boycott campaign Grab Your Wallet have urged supporters to contact both General Dynamics and MVM.
In an attempt to evade the long arm of U.S. intelligence that could mark a sea change in internet privacy, Microsoft has announced plans to build two new data centers in Germany that will store user information in a secure network and not allow access to anyone—including the U.S. government and Microsoft staff themselves—without explicit approval by the user or a “data trustee.”
If permission is granted by the user or the trustee, Microsoft would still be required to operate under their supervision.
In this case, the trustee is T-Systems, a subsidiary of German conglomerate Deutsche Telekom. By stationing its data servers in Frankfurt am Main and Magdeburg, Microsoft will be placing user data under German privacy protections, which are some of the strictest in Europe.
The move comes amid growing public outcry over government eavesdropping in the wake of Edward Snowden’s 2013 revelations that exposed National Security Agency (NSA) mass surveillance at home and abroad. And it may help address new privacy concerns arising just weeks after the U.S. Senate passed the controversial Cybersecurity Information Sharing Act (CISA), which supporters say would make it easier for tech companies to respond to security breaches—but which opponents say is nothing more than a government surveillance bill in disguise.
Microsoft, which publicly opposed CISA, has been in an ongoing legal battle with the Department of Justice (DOJ) after the company in December 2013 refused to hand over emails from a drug trafficking suspect stored on servers in Dublin, Ireland. Microsoft told DOJ officials they would have to get a warrant from an Irish court.
With that case still underway, the company’s initiative signals that it may be looking for a whole new approach to privacy.
The implications of the move are significant, even if they are not necessary fail-safe. As The Verge writes:
It’s an approach that’s comparable to Apple’s use of encryption that even the iPhone-maker can’t break — theoretically taking away the option of government authorities forcing the company to give up users’ data. However, none of these tactics are ever completely secure. For example, the Snowden revelations showed that despite Europe’s outward desire for data sovereignty, many local spy agencies still funneled European citizens’ data to the NSA.
Paul Miller, an analyst for Forrester, notes that although Microsoft is confident in the security of German servers, this arrangement has yet to be tested in the courts. “To be sure, we must wait for the first legal challenge. And the appeal. And the counter-appeal,” said Miller.
More importantly, though, Microsoft’s decision could end up affecting more than just its own users. If the German trustee model becomes a recognized standard for data security, then customers of other cloud computing firms like Google and Amazon could demand similar arrangements. EU officials might also be emboldened by the move. Last month, the EU Court of Justice invalidated the longstanding Safe Harbor treaty allowing US companies to send data on European citizens back to America. The treaty is currently being renegotiated, and Microsoft’s support for the data trustee model could feed into these debates.
The data centers—which are connected to each other by a private network that will operate separately from the internet—are aimed at organizations working with sensitive information, such as health or finances.
“These locally deployed versions of Microsoft’s commercial cloud services adhere to German data handling regulations and customers will be able to view how and where data is processed,” the company stated on Wednesday.
Microsoft Corp. is currently sitting on almost $29.6 billion it would owe in U.S. taxes if it repatriated the $92.9 billion of earnings it is keeping offshore, according to disclosures in the company’s most recent annual filings with the Securities and Exchange Commission. The amount of money that Microsoft is keeping offshore represents a significant spike from prior years, and the levies the company would owe amount to almost the entire two-year operating budget of the company’s home state of Washington.
The company says it has “not provided deferred U.S. income taxes” because it says the earnings were generated from its “non-U.S. subsidiaries” and then “reinvested outside the U.S.” Tax experts, however, say that details of the filing suggest the company is using tax shelters to dodge the taxes it owes as a company domiciled in the United States.
In response to a request for comment, a Microsoft spokesperson referred International Business Times to 2012 U.S. Senate testimony from William J. Sample, the company’s corporate vp for worldwide tax. He said: “Microsoft’s tax results follow from its business, which is fundamentally a global business that requires us to operate in foreign markets in order to compete and grow. In conducting our business at home and abroad, we abide by U.S. and foreign tax laws as written. That is not to say that the rules cannot be improved — to the contrary, we believe they can and should be.”
The disclosure in Microsoft’s SEC filing lands amid an intensifying debate over the fairness of U.S.-based multinational corporations using offshore subsidiaries and so-called “inversions” to avoid paying American taxes. Such maneuvers — although often legal — threaten to signficantly reduce U.S. corporate tax receipts during an era marked by government budget deficits.
White House officials have called the tactics an affront to “economic patriotism” and President Obama himself has derided “a small but growing group of big corporations that are fleeing the country to get out of paying taxes.” In a July speech, he said such firms are “declaring their base someplace else even though most of their operations are here.”
“I don’t care if it’s legal; it’s wrong,” Obama said. Meanwhile, Democratic lawmakers have been pushing legislation they say would discourage U.S. companies from avoiding taxes through offshore subsidiaries. The proposals are being promoted in advance of the 2014 elections, as polling suggests the issue could be a winner for the party. In Illinois, the issue has already taken center stage in the state’s tightly contested gubernatorial campaign.
Because Microsoft has not declared itself a subsidiary of a foreign company, the firm has not technically engaged in an inversion. However, according to a 2012 U.S. Senate investigation, the company has in recent years used its offshore subsidiaries to substantially reduce its tax bills.
That probe uncovered details of how those subsidiaries are used. In its report, the Senate’s Permanent Subcommittee on Investigations described what it called Microsoft’s “complex web of interrelated foreign entities to facilitate international sales and reduce U.S. and foreign tax.” The panel’s report noted that “despite the [company’s] research largely occurring in the United States and generating U.S. tax credits, profit rights to the intellectual property are largely located in foreign tax havens.” The report discovered that through those tax havens, “Microsoft was able to shift offshore nearly $21 billion (in a 3-year period), or almost half of its U.S. retail sales net revenue, saving up to $4.5 billion in taxes on goods sold in the United States, or just over $4 million in U.S. taxes each day.”
U.S. Sen. Carl Levin, D-Mich., said at the time: “Microsoft U.S. avoids U.S. taxes on 47 cents of each dollar of sales revenue it receives from selling its own products right here in this country. The product is developed here. It is sold here, to customers here. And yet Microsoft pays no taxes here on nearly half the income.”
Apple and General Electric, which also employ offshore subsidiaries, are the only U.S.-based companies that have more money offshore than Microsoft, according to data compiled by Citizens for Tax Justice. In all, a May report by CTJ found that “American Fortune 500 corporations are likely saving about $550 billion by holding nearly $2 trillion of ‘permanently reinvested’ profits offshore.” The report also found that “28 these corporations reveal that they have paid an income tax rate of 10 percent or less to the governments of the countries where these profits are officially held, indicating that most of these profits are likely in offshore tax havens.”
Microsoft’s use of the offshore subsidiary tactics has exploded in the last five years, with the amount of Microsoft earnings shifted offshore jumping 516 percent since 2008, according to SEC filings.
According to Microsoft’s filings, if the company repatriates the $92.9 billion it is holding offshore, it would face a 31.9 percent U.S. corporate tax rate. U.S. law generally permits companies to deduct the foreign corporate taxes they’ve already paid from the U.S.’s official 35 percent corporate tax rate. According to CTJ’s Richard Phillips, that means Microsoft’s disclosure implies the company is paying just 3.1 percent in the locales where it is currently holding the cash. Phillips says such an extremely low rate strongly suggests the firm is keeping the earnings not just in relatively low-tax locales like Ireland, Singapore and others the company has disclosed, but also in smaller countries like Bermuda that are considered true tax havens.
According to a Wall Street Journal report in 2012 about companies reducing transparency about their subsidiaries, Microsoft “once disclosed more than 100 subsidiaries [but] reported just 13 in its 2003 annual report and 11 in its 2012 report.”
Amazon should welcome our voices and our deep knowledge of the business.
Want to know why there’s a sudden wave of workers organizing to form unions across the country?
A lot of reasons, to be sure, but more than anything, I believe: Workers want to be heard. We spend most of our waking hours on the job, and we have a lot to say about what happens there. We want to find a way to make our employers actually listen to what we know, and what we want.
Companies with hourly workers on their boards of directors perform better—they enjoy higher profits, lower turnover, and stronger safety records.
In most companies, the boards of directors have no face-to-face contact with the people who do the actual labor of keeping the lights on and the packages delivered. They don’t know what it means to be watched while you take a restroom break, to have the pace of work determined by machines, to have to carry your belongings in a clear plastic bag so security can ensure you haven’t taken anything.
Workers know this, and we know how it feels to try to raise a family on $15 an hour, to have to report to work while ill because we have minimal paid leave, to work 12-hour shifts just to earn a few more cents an hour.
In fact, while Jeff Bezos blasted himself into space last summer, many essential workers were losing COVID-related paid sick leave, struggling to stay safe and healthy, and even mourning the loss of loved ones.
We want to share this reality and these experiences, and we want to find a way to make changes so the business and the workers can do better.
That’s why I worked so hard to help form a union at my warehouse in Bessemer, Alabama; and why I celebrated when the workers on State Island were successful earlier this year.
Amazon should welcome our voices and our deep knowledge of the business. In fact, on May 25, shareholders have a chance to acknowledge this potential, and support a resolution to nominate an hourly associate to the Board.
Amazon needs a worker on the board because current labor practices are running through workers. The average Amazon warehouse worker only lasts eight months on the job. The rate of turnover is so high that the company is exhausting the local labor supply.
Amazon needs a worker on the board because the pace of work is injuring workers at extraordinary rates. I’ve been injured myself, and they tried to blame me for it, while it was clearly an issue from the work. An ice pack and ibuprofen is supposed to cure every injury. Out of all the places I’ve ever worked, I’ve never seen the pace being pushed so fast, and seen safety not be the number one priority.
Amazon needs a worker on the board because they need to understand what it means when a coworker dies on the job. We’ve had several deaths in our facility and not once has Amazon acknowledged the loss of our coworkers. This was devastating and continues to crush our morale.
Amazon needs a worker on the board because we bring voices that are missing on the board. Amazon’s board remains mostly male and white, even though the majority of hourly workers are of color and women. And not one person on Amazon’s board has any idea what it means to try to keep a household running right now on $15 an hour—or $20 or $30 an hour.
Finally, Amazon needs a worker on the board because it will make the company more successful. We are the ones who know all the ins and outs of how the process works. From the tape to the robot arm to the distance to the bathroom, we know it best. Companies with hourly workers on their boards of directors perform better—they enjoy higher profits, lower turnover, and stronger safety records.
I’ll continue to do all I can to make life better for my coworkers, because I care for them and believe in our dignity. If Amazon truly wants to be “Earth’s Best Employer,” listening to its employees is a good place to start.
As ordinary workers across the United States watched inflation eat away at modest wage gains in 2021, many corporations—including firms contracting with the federal government—used record-shattering profits to lavish their CEOs with bigger pay packages and reward shareholders with billions of dollars in stock buybacks.
According to an analysis published Tuesday by the Institute for Policy Studies (IPS), the average gap between CEO and median worker pay at a sample of 300 low-wage U.S. corporations surged in 2021, rising to 670 to 1—up from 604 to 1 in 2020.
“Amazon has reported $10.3 billion in recent federal contracts, most of it to provide web services for the National Security Agency.”
Forty-nine of the publicly traded companies examined in the IPS study, titled “Executive Excess,” had CEO-to-worker-pay ratios above 1,000 to 1 last year.
Amazon, for instance, paid CEO Andy Jassy a staggering 6,474 times more than it paid its median worker in 2021, a year in which the e-commerce giant spent $4.3 million on anti-union consultants.
Overall, IPS found that CEO pay at the 300 corporations increased by $2.5 million to an average of $10.6 million last year while median worker pay grew by just $3,556, rising to an average of $23,968 as inflation soared to its highest level in decades.
IPS noted that skyrocketing inflation—which has been fueled by corporate profiteering—resulted in effective pay cuts for median workers at 106 of the companies in its sample.
Meanwhile, IPS observed, 67% of those firms spent a total of $43.7 billion on stock buybacks, which benefit company shareholders and help boost the stock-based compensation of executives. Now a common practice among profitable corporations, share buybacks were largely illegal before 1982.
“With the $13 billion Lowes alone spent on share repurchases, the company could have given each of its 325,000 employees a $40,000 raise,” the new report states. “Instead, its median pay fell 7.6% to $22,697.”
Sarah Anderson, director of the IPS Global Economy Project and lead author of the new study, said in a statement that “CEOs’ pandemic greed grab has sparked outrage among Americans across the political spectrum,” pointing to an April survey showing that nearly 90% of U.S. adults believe the widening chasm between CEO and worker pay is “a problem in this country today.”
That problem, according to IPS’ findings, is being exacerbated by taxpayer dollars. Out of the 300 companies analyzed, 40% were awarded contracts from the federal government between October 1, 2019 and May 1, 2022.
IPS found that the combined value of the federal contracts was $37.2 billion, and the average CEO-worker pay ratio of the contractors jumped to 571 to 1 in 2021.
“Amazon has reported $10.3 billion in recent federal contracts, most of it to provide web services for the National Security Agency,” the report notes. “The company reportedly also received a lucrative share of a multibillion-dollar CIA contract for cloud services. The details and exact value of this contract continue to be classified.”
Among other policy recommendations, IPS argued that President Joe Biden can and should take action unilaterally to ensure that contracts flow to firms with lower CEO-to-worker-pay ratios.
“The president could wield the power of the public purse by introducing new standards making it hard for companies with huge CEO-worker pay gaps to land a lucrative federal contract,” Anderson said.
The bill is being praised as “simple, bipartisan, wildly popular with voters, and a good first step toward reining in Big Tech.”
Amazon and tech giants are mounting a big-money push to tank bipartisan antitrust legislation its proponents say rightly takes on concentrated corporate power undermining small businesses and democracy.
Introduced in October by lead co-sponsors Sens. Amy Klobuchar (D-Minn.) and Chuck Grassley (R-Iowa.), the American Innovation and Choice Online Act (S.2992) is coming up against negative media and spending blitzes ahead of a possible vote later this month.
Bloomberg reported Monday that Senate Majority Leader Chuck Schumer (D-N.Y.) has promised a vote on the legislation this month, noting the narrow window ahead of the August recess.
The bill would, among other provisions, prevent major platforms like Amazon and Google from giving preferential treatment to their own products.
According to a report released last week by the Center for American Progress, the measure would “protect American consumers, small businesses, and innovation online.”
Industry lobby groups and major tech firms, however, are “going all out” against the bill, Axios reported Monday.
Dharmesh Mehta, Amazon’s vice president of worldwide selling partner services, for example, “recently tried lobbying third-party sellers on an online forum that they use to communicate with one another about hot topics” to encourage them to oppose the measure, according to CNBC. “I want to ensure that you are aware of this legislation and what you can do to try and stop it from harming you,” he wrote in part, and directed sellers to a contact-your-senator form. CNBC added:
Hundreds of sellers replied to Mehta’s post, including many who seemed unconvinced by Amazon’s point of view and promised to support the legislation. Third-party sellers, who account for more than half of Amazon’s retail volume, have in recent years expressed frustration over the costs they pay to stay in good standing, the amount Amazon charges them for ads, and Amazon’s inability to rid the marketplace of scams and bad actors.
U.S. Chamber of Commerce executive vice president Neil Bradley also came out swinging against the bill, writing in a Monday blog post that it would afford “unprecedented authority to bureaucrats at the FTC and DOJ allowing them to micro-manage the American economy and pick winners and losers in the marketplace.” And in a letter to senators last week, the chamber called it “misguided” and urged lawmakers to vote against it.
To help achieve that aim, as a Washington Post analysis published Monday highlighted, “tech trade associations and groups with ties to industry giants are… launching a major advertising blitz that’s increasingly targeting swing-state Democrats.”
The Post reported:
“CCIA—a trade group that counts Amazon, Apple, Facebook, and Google as members—took out over $8 million in TV ads earlier this year primarily targeting swing states like Arizona, Georgia, Nevada, and Wisconsin, according to the independent news site the Lever. CCIA also took out over $2 million in ads in New Hampshire, according to the New Hampshire Journal. (Amazon founder Jeff Bezos owns The Washington Post.)
In recent months, another group called New Democracy has “taken out at least $167,000 in Facebook ads and over $218,000 in Google ads that largely call on a narrow set of swing-state Democrats to reject the bill,” the Post added. “The ads have been shown at least 13 million times, according to a review by The Technology 202 of the companies’ digital advertising libraries.”
Bloomberg also noted that “Apple, Amazon, Google, and [Facebook parent company] Meta spent $16.7 million lobbying in the first three months of 2022, with all four identifying the antitrust bills as their top priority, according to lobbying disclosures filed with Congress,” referencing the Senate and House versions. And Apple, Axios reported Monday, “spent more on lobbying last quarter ($2.5 million) than in any previous quarter.”
The money may have been well spent.
The legislation “passed the Senate Judiciary Committee with support from both parties earlier this year,” Politico reported last month. However, “in the days since Senate Majority Leader Chuck Schumer told Klobuchar he would hold a floor vote as early as [June], several Democratic senators have privately expressed deep reservations about voting for the legislation, particularly with a midterm election looming, in their conversations with Schumer and other Democratic offices.”
Fight for the Future, a digital rights group backing the legislation, said in an email to supporters Tuesday that “a small faction of Senate Democrats may be betraying you for Big Tech.”
“There is no question that these lawmakers, including Maggie Hassan (N.H.), Michael Bennet (Colo.), Brian Schatz (Hawaii), Dianne Feinstein (Calif.), and Alejandro Padilla (Calif.), are being swayed by Big Tech lobbyists,” the group wrote.
“But siding with Big Tech at the expense of passing legislation that would rein in monopolistic companies that abuse their gatekeeper status to undermine human rights, distort democracy, abuse our personal data, and stifle competition,” said Fight for the Future, “is just wrong.”
Stacy Mitchell, co-director at the Institute for Local Self-Reliance, called Klobuchar’s bill “simple, bipartisan, wildly popular with voters, and a good first step toward reining in Big Tech.”
In a lengthy Twitter thread last week debunking Amazon’s claim that the legislation would kill its Prime service, Mitchell wrote that the measure would stop the online retail giant and other Big Tech firms from “self-preferencing and market manipulation.”
Its passage, she added, could bring about “the end of some of the most nakedly monopolistic tactics used by Big Tech.”
"It is time for Amazon to end its blatant disregard of labor law and treat workers with the respect and dignity they deserve." COMMON DREAMS STAFF June 11, 2022 Sen. Bernie Sanders (I-Vt.) and Sen. Kirsten Gillibrand (D-N.Y.) Friday sent a letter to Amazon CEO Andy Jassy urging him to drop the company's objections to the historic union election on Staten Island before a National Labor Relations Board (NLRB) hearing on Monday and finally recognize the Amazon Labor Union. "If Amazon can afford to spend $10 billion in stock buybacks to enrich its wealthy shareholders and executives—including the second richest person in the world, Jeff Bezos—it can afford a unionized workforce," the senators wrote. "If Amazon can spend over $4 million in a single year on union-busting and $213 million on your compensation, it can afford a workforce that can collectively bargain for better wages, better benefits, safer working conditions, and reliable schedules…We strongly urge you to respect the will of Amazon workers by dropping your objections, recognizing the Amazon Labor Union and negotiating in good faith before the NLRB hearing on June 13th. It is time for Amazon to end its blatant disregard of labor law and treat workers with the respect and dignity they deserve." Since the workers on Staten Island became the first-ever Amazon warehouse to successfully vote to form a union in the United States, Amazon has refused to negotiate a first contract, refused to recognize that the union exists, and filed 25 objections to the election – despite the NLRB certifying the victory. "Sadly, Amazon has refused to accept the will of their workers and has instead filed 25 objections to the election, accusing both the union and the NLRB of misconduct. Amazon has objected to the union election from the beginning, alleging that there is insufficient support and the union and NLRB manipulated evidence of support. But, Mr. Jassy, last month's election results make it clear that your workers at JFK8 want a union. Amazon has gone as far as alleging that the NLRB and the union's actions are "substantially more egregious" than its own actions to interfere with a union election in Bessemer, Alabama by illegally installing a mailbox to intimidate workers" the senators wrote. Last year, Amazon increased its profits by 75 percent to a record-breaking $35 billion while avoiding over $5 billion in taxes and while spending $4.3 million on union-busting consultants and lawyers. Amazon has also been penalized more than $75 million for breaking federal discrimination and wage laws and is currently being sued by the NLRB to reinstate a worker who was illegally fired for organizing a union. Amazon is waging a war against workers' right to unionize – from forcing workers to attend anti-union meetings, to threatening to slash wages and benefits if workers form a union – and there are currently 51 open Unfair Labor Practice cases against Amazon pending before the NLRB.
On Wednesday, Jeff Bezos, the world’s wealthiest person, shattered the $200 billion ceiling. He had a decent day on the stock market, with Amazon shares edging up about 2 percent. But a “decent” 2 percent day for the richest man on Earth means his net wealth soared by around $5 billion that day. And voilà, just like that, we’ve got the world’s first multi-centibillionaire, and I’m pretty sure the first ever printing of the word “multi-centibillionaire.” Strange days, friends. Strange days, indeed.
Dan Riffle, a senior advisor to Rep. Alexandria Ocasio-Cortez, has famously asserted that “every billionaire is a policy failure.” If that’s so—and I do believe it is—then the United States of America is at least to some degree a failed state. And by “some,” I mean much more than we can afford to ignore.
Bezos isn’t alone up there. Yes, he is a whopping $75 billion richer than Bill Gates, the runner-up on the Bloomberg Billionaire Index. But that still means that the Microsoft co-founder is worth a staggering $125 billion, with Facebook co-founder Mark Zuckerberg ($111 billion) not far behind, and Tesla CEO Elon Musk ($104 billion) pulling the platinum caboose of the centibillionaire’s club.
A train, replete with all the Snowpiercer-like mental imagery it conjures, seems a fitting metaphor for a system that progressive economist and former U.S. labor secretary says has “gone off the rails.”As in Snowpiercer, Bezos and his plutocrat pals in the front of the train are worse than oblivious to the plight of the poor passengers in the back. They’re downright contemptuous.
Have you heard about Chris Smalls? He was a worker at Amazon’s Staten Island warehouse who was fired after organizing a work stoppage to protest a lack of protective gear and pandemic hazard pay amid the deaths of numerous company employees. What Amazon executives didn’t expect was that Smalls would become a cause célèbre who would draw worldwide attention to some of their worst corporate practices. Scrambling into damage control mode, Amazon general counsel David Zapolsky decided the company’s best course of action was to smear Smalls, a Black man, as “not smart or articulate.”The system is beyond broken. It is beyond unfair. It has entered the realm of insanity. What else would you call it when three men own more wealth than the bottom half of the U.S. population—that’s 160 million people—combined? How would you describe a system in which tens of millions of people are jobless, millions of children are hungry, and millions of families are at risk of becoming homeless, while the net worth of America’s billionaires has skyrocketed by nearly $800 billion over the past five months?The four richest men in the world now have a combined net worth of $540 billion. In my own personal quest to wrap my head around such stupendous wealth, I found countries to be a useful benchmark. More specifically, I reckoned that comparing the tech titans’ total treasure to the annual gross domestic product of various nations, the only truly appropriate entities against which these men can be accurately measured, would give me a fuller understanding of the scale and scope of their fortune.
So I got hold of the World Bank’s latest available (2019) world GDP figures and from these I learned that if Bezos, Gates, Zuckerberg and Musk were a country, their net worth would fall between the GDP of Thailand ($543 billion), the world’s 22nd-largest economy, and #23 Sweden ($530 billion).
On his own, Bezos’ bazillions would place him roughly on par with #52 New Zealand ($206 billion), and well ahead of oil-drenched #53, Qatar ($183 billion). Had Bezos and his former wife not divorced last year, the couple would be worth at least $263 billion, or about as much as the GDP of Finland, the world’s 44th-largest economy.
Bezos is now on track to become world’s first trillionaire. My spell-check doesn’t even recognize that word; surely it’s a mistake? Oh, but it’s not, and according to the business research firm Comparisun, Bezos is projected to reach that unimaginable milestone by 2026.
Unless, that is, somebody stops him and his ilk. Some think this can realized via more traditional means:
Progressives on Wednesday slammed what they called a proposed $10 billion handout to Amazon founder Jeff Bezos—the world’s first multi-centibillionaire—in the 2022 National Defense Authorization Act as a “giveaway of galactic proportions” in the face of growing wealth inequality and the inability of U.S. lawmakers to pass a sweeping social and climate spending package.
According to Defense News, Senate Majority Leader Chuck Schumer (D-N.Y.) plans to merge the $250 billion U.S. Innovation and Competition Act of 2021 (USICA)—aimed largely at countering the rise of China—with next year’s NDAA, which would authorize up to $778 billion in military spending. That’s $37 billion more than former President Donald Trump’s final defense budget and $25 billion more than requested by President Joe Biden. The NDAA includes a $10 billion subsidy to Bezos’ Blue Origin space exploration company.
“Providing Jeff Bezos with $10 billion of taxpayer money would be an inappropriate giveaway of galactic proportions,” Stuart Appelbaum, president of the Retail, Wholesale, and Department Store Union (RWDSU), said in a statement Wednesday.“Jeff Bezos shouldn’t receive taxpayer subsidies for his personal projects—period,” he continued. “In at least two recent years, one of the richest people on the planet paid no income tax; yet he then demands billions in taxpayer funds for a project that’s already been awarded to another company. This is the height of hubris.”
“Rather than waste $10 billion on a redundant space contract for Bezos, that money could be used to adequately fund Social Security Disability, Medicare and Medicaid, and the food stamps that many of his own employees at Amazon and elsewhere have to rely on to make ends meet,” Appelbaum said.
“Jeff Bezos’s business model includes feasting on public subsidies—and the U.S. Senate must not acquiesce to his demands,” he added. “Furthermore, until Jeff Bezos changes the way his employees are mistreated and dehumanized at Amazon and elsewhere, no elected official should support the passage of subsidies for him or any of his projects.”Sen. Bernie Sanders (I-Vt.) has condemned the NDAA for containing $52 billion in “corporate welfare” for Big Tech. Explaining why he would vote against the NDAA, Sanders said Tuesday that “combining these two pieces of legislation would push the price tag of the defense bill to over $1 trillion—with very little scrutiny.”
“Meanwhile,” he added, “the Senate has spent month after month discussing the Build Back Better Act and whether we can afford to protect the children, the elderly, the sick, the poor, and the future of our planet. As a nation, we need to get our priorities right.”