 President Barack Obama speaks during a meeting with the President's Council on Jobs and Competitiveness in Washington, DC, February 24, 2011 with General Electric CEO Jeff Immelt. Spitzer: Big U.S. companies created 2.4 million jobs overseas, cutting 2.9 million jobs here Today's Number of the Day is 2.9 million. We've all come to believe that when big businesses–meaning the mutli-nationals that dominate the airwaves with their advertising and the halls of Congress with their lobbyists–when they begin to hire again, the U.S. economy will hum and whir the way it's supposed to. Well, here's some bad news: During the first decade of this century–and not just the dip of the recession at the end of it–U.S. multi-nationals cut their workforces in this country by 2.9 million jobs, while increasing their employment overseas by 2.4 million. Take GE, for example: between 2001 and 2010, GE cut 25,000 U.S. jobs, and added 2000 jobs overseas. Wait a minute! Is this the same GE that made $14.2 billion in profits last year and paid no–ZERO– U.S. taxes? The same GE whose chairman Jeffrey Immelt is the the chair of President Obama's job creation committee, the Council on Jobs and Competitiveness? Somebody at the White House should have checked these numbers before making this appointment. As Immelt points out: jobs follow not only labor costs, but also markets. In 2000, 30 percent of GE's business was overseas. Today–60 percent of it is. For more on this subject, CLICK HERE to read a really superb article in The Wall Street Journal written by David Wessel. And for even more, CLICK HERE to read CNNMoney coverage of GE's tax situation.
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Actually, GE did pay U.S. taxes last year .... at the federal, state and local level. And the lost jobs are largely due to dispositions in its portfolio. And, no, I don't work for GE - now or ever. Just a fan of nuance.
Gary Sheffer from GE. A few clarifications. First, GE overhauled our business portfolio in the last decade - selling about half the company so making an apples-to-apples jobs comparison is unfair. If you discount the sale of businesses, GE's U.S. employment is up over the past 10 years. Much of this growth in U.S. employment - about 31 percent in our core industrial businesses - is tied to exports, which we have more than doubled in a decade. And we are adding about 16,000 U.S. jobs in 2010-11. Second, our U.S. tax rate has been low the last two years because of losses in GE Capital. Our tax rate will rise in 2011 as GE Capital recovers. We did not pay "zero" in U.S. taxes for 2010 nor have a "zero tax rate." When we file our 2010 tax return in September, we expect to have a small U.S. income tax liability. In addition, we paid more than $1 billion in federal, state and local taxes in the U.S. in 2010. Finally, on jobs and "cheap labor," Jeff Immelt said in a recent speech in Washington, "We've globalized around markets, not cheap labor. The era of globalization around cheap labor is over. Today we go to Brazil, we go to China, we go to India, because that's where the customers are."
It's just more proof that the U.S. Tax Code is fundamentally flawed and needs to be thrown out and replaced with a flat tax with no loopholes. But that will never happen because Washington is broken and refuses to ACTUALLY fix their own mess, they'd just rather keep putting it on the backs of the few of us that actually pay taxes.
Yes but the people have the power to vote all of them out of office and make the entire congress a 1 term wonder, but we won't do it, so they have no fear, just status quo and business as usual, kickbacks and handouts.
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