Amazon and Taxes

For John, BLUF:  In cases like this it is usually beneficial to dig a little deeper.  Tax policies are usually structured to drive certain behaviors, like corporate investment.  Put another way, taxes are not so much about raising money as they are about shaping human behavior.  Nothing to see here; just move along.

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Why Does Amazon Pay $0 in Federal Income Taxes?

Here is the sub-headline:

There's a reason Amazon as a corporate entity usually escapes income taxes.

From FEE, by Prof Tyler Cowen, 20 February 2019.

Here is the lede plus one:

The main reason Amazon as a corporate entity does not pay much in taxes is because the company so vigorously reinvests its profit.  The resulting expensing provisions lower their tax liabilities, in some cases down to zero or near-zero.

That is, in fact, the kind of incentive our tax system is supposed to create, and does so only imperfectly, noting that many economists have suggested moving to full expensing.

I am thinking reinvestment creates jobs, at least temporarily, as buildings are built and equipment purchased.  And later people are hired to work in those buildings, to operate that machinery.

A little bit later the article makes this point:

Amazon pays plenty in terms of payroll taxes and also state and local taxes.  Nor should you forget the taxes paid by Amazon’s employees on their wages.  Not only is that direct revenue to various levels of government, but the incidence of those taxes falls somewhat on Amazon, which now must pay higher wages to offset the tax burden faced by their employees.

I am glad there are people, like Mr Jeff Bazos, out there creating jobs.

Hat tip to the InstaPundit.

Regards  —  Cliff

President Getting Ready for [Limited] Amnesty

For John, BLUF:  Let's look before we shoot.  Nothing to see here; just move along.

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Here is an item from The Hill on the anticipated Presidential action taking with regard to illegal immigration.  "White House prepares activists for Obama's immigration order."

One source said the White House sought to "temper expectations," on the executive action, cautioning that while some advocates have pushed for him to carry out the Senate’s immigration reform bill, Obama doesn't have the legal authority to go as far by acting alone.

"They're setting expectations, making it clear he has the legal authority to do what he's going to do, but that he's not going beyond his authority, as some advocates would like," said one source familiar with the calls on Tuesday.

The source predicted that, given the timing of the calls, that the White House could announce the executive order as early as Wednesday, but cautioned the president could also wait for the government funding fight in Congress to run its course.

To cut to the chase, the President is either:

• Going to issue instructions within his authority under Article II of the US Constitution and the laws already passed by the US Congress, or,
• Going to exceed his authority.

If he acts within his authority the prime question, the only question, is why he didn't act sooner, act this last Summer, or within the last year, or the year before, or two years ago or four years ago or back when the Democrats dominated Congress?  Why has he waited to long?  It is that simple.  Why was he negligent.

On the other hand, if his actions exceed his authority, what will the US Congress do to regain its rightful place as the maker of the laws?  Impeachment is off the table.♠  What is available is the power of the purse strings.  The Congress can refuse to fund or can defund activities that it believes are illegal.  Simple as that.  From there it is to the Courts.  Building a case against a President who has acted outside his authority.  Of course the Democrats in Congress would have to recognize it is Constitution before Party, before Ideology.  Otherwise it is just the Civil War all over again, with the Democrats rejecting the Union and Prof Barack Obama the new Jefferson Davis.

But, we need to examine what President Obama does before we do anything.  It may all be perfectly legal, if somewhat tardy.

Hat tip to the Instapundit.

Regards  —  Cliff

♠  Impeachment is off the table, if for no other reason than impeaching someone who is seen as the first "Black" President would just poison the well.  On the other hand, if and when Senator Harry Reid contacts the Speaker of the house and says now is the time, Impeachment may be on.