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US Corporations Profits Come at Expense of Workers

Service : Economy
TEHRAN, March 29 (ICANA) – Some economists say American corporations like General Electric have amassed high profits at the expense of working people.
Tuesday, March 29, 2011 10:46:33 AM
US Corporations Profits Come at Expense of Workers

"The corporate profitability does not go hand in hand with the improvement in the lives of workers. In fact higher profits have come about at the expense of working people, at the expense of paying lower wages and low benefits."

Ismael Hossein-zadeh, Professor of Economics & Author made the remarks in an exclusive interview with Press TV's U.S.-Desk on Monday.

Hossein-zadeh also said that big corporation taxes now are much lower than they were several decades ago.

"Most of them hardly pay any tax because they concoct or fabricate so many expenses which lower their revenues and their profits and therefore they pay very little tax. Whereas in the 40s, 50s, 60s and even 70s, the average tax rate was much higher."

He added that American corporations also pocket a lot of money through what he called outsourcing and diluting workspace and environmental standards.

"Deregulation gives them a lot of maneuvering room for cutting cost. Environmental standards are diluted or weakened. Health and safety standards at the workplace that is for workers, are diluted or weakened so all these factors combined have helped corporate profitability to be very healthy. They produce mostly, especially General Electric produce mostly overseas. They pay very low wages and benefits when they produce abroad in countries like Vietnam and China and so on."

GE earned $5.1 billion in profits in America in 2010, in addition to another $9.1 billion it made overseas. But it paid nothing to the IRS. Instead, it enjoyed tax breaks totaling $3.2 billion.

A review of company filings and Congressional records shows that one of the most striking advantages of General Electric is its ability to lobby for, win and take advantage of tax breaks.

General Electric reported worldwide profits of $14.2 billion, and said $5.1 billion of the total came from its operations in the United States.

In 2009 and 2010, GE closed 28 manufacturing plants in the United States and it now employs more people overseas than it does in the U.S.

Half of GE's revenues come from the production of industrial, commercial and medical machinery and equipment. Providing loans accounts for another 30%.

The share of U.S. taxes paid by corporations has fallen from 30 percent of federal revenue in the 1950s to 6.6 percent in 2009.

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