Harley-Davidson workers stunned by plant closure after tax cut

I have seen the enemy and it is the corporations. This is what corporations do when they get tax breaks. They are supposed to be spending the loot on R&D, new equipment acquisition, workers compensation, etc. Instead, greed ends up consuming them.

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http://www.nbcnews.com

by Gabe Gutierrez and Annie Rose Ramos

May.23.2018

The iconic company announced that it was slashing hundreds of jobs despite expecting to reap huge benefits from the new tax law.

Tim Primeaux has worked at the Harley-Davidson plant in Kansas City, Missouri, for 17 years. He was sure he was going to retire from the company.

That all changed when Harley-Davidson told its 800 employees in January that the plant will be closing next year. Operations will be shifted to the motorcycle manufacturer’s facility in York, Pennsylvania.

“We did everything Harley-Davidson asked us to do,” said Primeaux, a welder. “To have it all blow up in your face is kind of disappointing.”

Days later, Harley-Davidson announced a dividend increase and a stock buyback plan to reward shareholders, repurchasing 15 million of its shares, valued at nearly $700 million.

Like other corporations, Harley-Davidson is benefiting this year from the tax cut law passed in 2017, which slashed the corporate rate from 35 percent to 21 percent. The company maintains that the dividend increase and stock buyback is unrelated to the tax savings.

House Speaker Paul Ryan visited a Harley plant in Wisconsin in September and said, “Tax reform can put American manufacturers and American companies like Harley-Davidson on a much better footing to compete in the global economy and keep jobs in America.”

Many Harley-Davidson workers wondered if the tax cut would trickle down to help employees. But a recent CNBC survey found that only 10 companies in the S&P 100 say they have specific plans to use the savings to boost worker pay.

Workers were taken aback by the decision to close the plant. “You could see it on everybody’s faces, just shock and awe,” recalls Primeaux. “It was like I was in a bad dream, just stuck in it.”

Harley is also building a new plant in Thailand. However the company maintains that the Bangkok plant is “separate and unrelated” to the decision to close the Kansas City plant, according to Michael Pflughoeft, a spokesman for Harley-Davidson.

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“The greatest country, the richest country, is not that which has the most capitalists, monopolists, immense grabbings, vast fortunes…

Apparently nothing much changes.

“The greatest country, the richest country, is not that which has the most capitalists, monopolists, immense grabbings, vast fortunes, with its sad, sad soil of extreme, degrading, damning poverty, but the land in which there are the most homesteads, freeholds — where wealth does not show such contrasts high and low, where all men have enough — a modest living— and no man is made possessor beyond the sane and beautiful necessities.”
–Walt Whitman
American poet (1819-1892)

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When CEO’s Earn 5,000 Times as Much as a Company’s Workers

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With permission from

http://www.counterpunch.org

by Sarah Anderson

May 25, 2018

Mattel is one of the largest toy-making companies on earth. Turns out it’s one of the biggest manufacturers of income inequality, too.

Last year, the Barbie doll manufacturer paid its CEO nearly 5,000 times as much as its median worker.

This stunning revelation is the result of a new regulation that requires U.S. publicly held corporations to report their CEO-worker pay ratios to the Securities and Exchange Commission.

Mattel’s gap is the widest reported so far. But most other big U.S. companies also have staggering divides. According to a new report by the staff of Minnesota Congressman Keith Ellison, the first 225 large corporations to release their numbers had pay ratios averaging 339 to 1.

“This immense inequality is a crisis for our economy and our democracy,” said Ellison, a longtime advocate of pay gap disclosure.

What’s good for these CEOs, however, is actually bad for business.

A CNBC analysis of the new pay ratio data, for example, suggests that companies with large pay disparities have lower profits per employee.

Why might that be? According to a recent study by a Harvard Business professor, companies tend to perform poorly if workers feel they’re not paid fairly. The study’s author said workers who feel that way are likely to lack motivation and even quit their jobs.

It’s not hard to understand how it could put a damper on your morale to be working hard and struggling to get by while your boss is being rewarded hundreds — or even thousands — of times more than you on payday.

Doug Smith, a former partner at the big McKinsey management consulting firm, argues that the economic costs of huge pay gaps go far beyond the problems of low employee morale and high turnover.

“Instead of building a real economy beneficial to all,” Smith says, “these unethical pay practices spread outsourcing, offshoring, tax avoidance, downsizing, and the substitution of good-paying permanent jobs with temporary, precarious employment.”

There’s a growing movement to use the new pay ratio data to encourage corporations to narrow their gaps. Portland, Oregon will soon become the first city to impose a tax penalty on companies with pay gaps above 100 to 1.

Charlie Hales, Portland’s mayor when the law was passed in late 2016, argued that it made good business sense to encourage narrower gaps.

In a former job at an employee-owned engineering firm, Hales had seen firsthand how a small pay ratio boosted the bottom line. “Everyone worked a little harder because your success was my success,” Hales said. “And that egalitarian culture led to a strong work ethic that drove the corporation to success.”

With the new pay ratio data now coming out, lawmakers in six states — California, Connecticut, Illinois, Massachusetts, Minnesota, and Rhode Island — are considering Portland-style pay ratio taxes.

Narrowing the divides within U.S. corporations may not automatically leave us all whistling away while we work. But we’ll all pay a price if we keep fiddling while extreme inequality burns down our economy.

More articles by:Sarah Anderson

Sarah Anderson directs the Global Economy Project at the Institute for Policy Studies.

Confessions of a College Professor: Rants and raves about the mess of higher education in the United States (And Canada)

No wonder education has become so expensive.

Higher Ed Pay Skyrockets In Canada Too

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By Professor Doom

April 12, 2018

So I’m finishing up on an excellent article taking the entire Canadian higher education system to task. The American system operates by essentially the same rules, however, and Canada’s is merely a reflection of the incredibly corrupt system of their much larger southern neighbor.

The last abuse discussed in the article is administrative looting of the system. It’s little different, of course, from what goes on in the U.S., only smaller in scale. For American readers, you should increase the numbers given by around 40% to get an idea of what even a tiny college is raking in from the taxpayers.

In 2011, David Johnston, president of the University of Waterloo, made $1,041,881. [40] Indira Samarasekera of the University of Alberta had a total compensation package of over $1.1 million in the final year of her contract. [41]Elizabeth Cannon of the University of Calgary and David Turpin of the University of Alberta banked $897,000 and $824,000 respectively during the 2016–’17 academic year. [42] Even presidents at small- and medium-sized universities now routinely receive between $300,000 and $500,000 in compensation, this not including additional forms of remuneration that combined can reach as high as $200,000 per year. [43]

The author paints in well-documented but broad strokes, so allow me to fill in an important missing detail:

Administrators greatly outnumber faculty, and the latter have seen their salaries actually shrink over the years, especially as more and more faculty positions become “part time” jobs, or at least are paid as much.

Yes, the person at the top is making sickening amounts of money, and it’s even more repugnant when you consider these guys gets perks like free cars, free jets, a free mansion, a personal restaurant, an expense account greater all by itself more than faculty pay, and all the other insane benefits that simply did not exist before the student loan scam drowned our campuses in money.

But compounding this putrescent pay is the legion, and I do mean legion, of under-administrators infesting our campuses. Yes, I’ve seen a couple of classrooms-buildings erected in my 30 years of teaching in higher ed…but I’ve seen more administrative palaces built in the last 2 years than all the classrooms-buildings of my career put together.

These palaces are built from the ground up with luxury and beauty in mind, great glittering chateaus built for the royal caste sucking up all that student loan money. Our campuses are covered in these things, and each one is filled with functionaries, from deanlings to vice-presidents of Diversity (oh so many of those!), and they, too are paid handsomely, often with royal perks which, all by themselves, any faculty would feel privileged to take in lieu of their usual adjunct pay.

Every year, the statistics on salary are compiled…and every year, these guys see a 10% or more pay raises. Anyone who feels like it can see with his own eyes that making less than $100,000 a year as a college administrator, no matter how irrelevant the position, is difficult to do. Meanwhile, your typical college teacher qualifies for food stamps (no money in the budget, you see. Too bad.).

After a lifetime of teaching, my retirement package beyond money I was forced to invest (at ridiculously poor returns) is typical: zero. It’s different for admin:

Peter George netted $1.4 million after leaving his position at McMaster University, $99,999 annually, or one dollar less than the salary limit prescribed by the Public Sector Salary Disclosure Act (PSDA) so McMaster wouldn’t have to reveal the amount publicly. [45] And this doesn’t include the tens of thousands of dollars George received in additional compensation for insurance, health care, car allowance, and travel — all after he’d resigned!

–emphasis added. Do note that even when these people quit, they still get huge rewards.

I’ve mentioned before the insane golden parachutes these guys get, which are only a fraction of what the author sees in Canada. Isn’t it completely ridiculous that you can quit your job as a university admin and still rake in the loot? I emphasize we see this in the US on a regular basis as well.

In case the gentle reader is wondering how a system could be so broken that saying “I quit this job,” even quitting under a cloud of criminal accusations and obvious fraud, could still merit a million dollars or more of bonus payments, the underlying concept is called “best practices.” Honest, they justify the looting because of prior looting…it’s just that simple.

…these packages don’t compare to the one received by Harvey Weingarten, former president of the University of Calgary, who stands to collect as much as $4.75 million in pension monies after serving as president for only eight years. [46] The discovery of Weingarten’s remuneration package came to light just as he was warning the University of Calgary community that up to 200 jobs would have to be cut in an effort to address a budget shortfall of $14 million.

The ostentatious arrogance of the Poo Bah does nothing for my temper. The above is little different than being told the school just doesn’t have the budget for the $10,000 it would take to light up the parking lot so the students could feel safe…then watching the $500,000 a year Poo Bah get into his $80,000 “perk” car and go to his $1,000,000 home (mostly paid for by his annual $300,000 year bonus for good growth), while the $100,000 a year dean and her $80,000 a year assistant tells us all dozen faculty at the school have been denied our 1% pay raises because no money, you see; and all five $100,000 a year HR people and the $150,000 a year Vice President of Finance confirm the Dean is telling the truth. Afterwards, the $250,000 Vice-Provost and his $80,000 secretary also come in to confirm it. After the 3 pm meeting, we bump into the $120,000 Registrar and four of her co-workers whose titles we can’t guess coming back from lunch at a place we all know about, but could never dream of having enough money to eat there just because it’s lunch time.

In a school with only a couple thousand students on campus, by the way.

I’d like to conclude by addressing our university administrators directly. So far I’ve written about you; now I want to talk to you.

For laughs, the author actually addresses the admin…you’ve got to be kidding me. Please understand the numbers being quoted here are not pulled out of a hat…they’re documented—these schools take government money, you see, and one of the many government strings attached to that money is documentation of how it’s spent.

The first thing faculty expect from you is some honesty about the situation. The data is in and all credible sources agree that our students are in trouble and so too is our curriculum. We can’t get anywhere if you continue to deny what’s actually happening. The university in this regard increasing feels like a government in permanent damage control, where nary a word against anything can be spoken and no admission of failure is permitted. If you’d simply drop the facade we might be able to get somewhere.

Wow, asking for honesty? Good luck with that. The primary reason these guys lie so blatantly is because there’s nothing to stop them now. Addressing admin and asking them to play nice accomplishes nothing.

On the other hand, simply starving them out, by shutting down that student loan scam, will get their attention far more effectively than polite requests to stop looting so much.

I grant my solution is as likely to occur as polite requests are as likely to be heeded, at least in the near term. However, at some point, the money will stop flowing.

Finally, you must drop the childish and short-sighted sidelining of sciences and humanities not obviously related to your commercial interests…

The author then goes on to ask for quite a few other things from admin, but this is just extended idiocy. Admin holds all the cards, and these appeals are as pathetic as those from the high school nerd begging for mercy as a bully pummels him again and again…It’s not gonna happen, and so not worth further comment on my part.

The comments are, of course, quite supportive, but all neglect to point out the simple fact that the solutions and appeals the author provides have zero chance of changing anything on campus.

I assure the reader: stop the flow of billions of dollars via the student loan scam, and campuses will change very, very, quickly.

 

Tulip mania: the classic story of a Dutch financial bubble is mostly wrong

theconversation.com

Anne Goldgar

Professor of Early Modern History, King’s College London

February 12, 2018

Right now, it’s Bitcoin. But in the past we’ve had dotcom stocks, the 1929 crash, 19th-century railways and the South Sea Bubble of 1720. All these were compared by contemporaries to “tulip mania”, the Dutch financial craze for tulip bulbs in the 1630s. Bitcoin, according some sceptics, is “tulip mania 2.0”.

Why this lasting fixation on tulip mania? It certainly makes an exciting story, one that has become a byword for insanity in the markets. The same aspects of it are constantly repeated, whether by casual tweeters or in widely read economics textbooks by luminaries such as John Kenneth Galbraith.

Tulip mania was irrational, the story goes. Tulip mania was a frenzy. Everyone in the Netherlands was involved, from chimney-sweeps to aristocrats. The same tulip bulb, or rather tulip future, was traded sometimes 10 times a day. No one wanted the bulbs, only the profits – it was a phenomenon of pure greed. Tulips were sold for crazy prices – the price of houses – and fortunes were won and lost. It was the foolishness of newcomers to the market that set off the crash in February 1637. Desperate bankrupts threw themselves in canals. The government finally stepped in and ceased the trade, but not before the economy of Holland was ruined.

Yes, it makes an exciting story. The trouble is, most of it is untrue.

My years of research in Dutch archives while working on a book, Tulipmania: Money, Honor and Knowledge in the Dutch Golden Age, told me a different story. It was just as illuminating, but it was different.

 

Gordon Gekko talks tulips. Wall Street: Money Never Sleeps / scottab140

Tulip mania wasn’t irrational. Tulips were a newish luxury product in a country rapidly expanding its wealth and trade networks. Many more people could afford luxuries – and tulips were seen as beautiful, exotic, and redolent of the good taste and learning displayed by well-educated members of the merchant class. Many of those who bought tulips also bought paintings or collected rarities like shells.

Prices rose, because tulips were hard to cultivate in a way that brought out the popular striped or speckled petals, and they were still rare. But it wasn’t irrational to pay a high price for something that was generally considered valuable, and for which the next person might pay even more.

 

A sign of good taste? Michiel Jansz van Mierevelt, ‘Double portrait with tulip, bulb, and shell’, 1606, Author provided

Tulip mania wasn’t a frenzy, either. In fact, for much of the period trading was relatively calm, located in taverns and neighbourhoods rather than on the stock exchange. It also became increasingly organised, with companies set up in various towns to grow, buy, and sell, and committees of experts emerged to oversee the trade. Far from bulbs being traded hundreds of times, I never found a chain of buyers longer than five, and most were far shorter.

And what of the much-vaunted effect of the plague on tulip mania, supposedly making people with nothing to lose gamble their all? Again, this seems not to have existed. Despite an epidemic going on during 1636, the biggest price rises occurred in January 1637, when plague (mainly a summer disease) was on the wane. Perhaps some people inheriting money had a bit more in their pockets to spend on bulbs.

Prices could be high, but mostly they weren’t. Although it’s true that the most expensive tulips of all cost around 5,000 guilders (the price of a well-appointed house), I was able to identify only 37 people who spent more than 300 guilders on bulbs, around the yearly wage of a master craftsman. Many tulips were far cheaper. With one or two exceptions, these top buyers came from the wealthy merchant class and were well able to afford the bulbs. Far from every chimneysweep or weaver being involved in the trade, the numbers were relatively small, mainly from the merchant and skilled artisan class – and many of the buyers and sellers were connected to each other by family, religion, or neighbourhood. Sellers mainly sold to people they knew.

 

Patterned petals were very valuable. Hans Bollongier, ‘Floral still life’, 1639 (Rijksmuseum)

When the crash came, it was not because of naive and uninformed people entering the market, but probably through fears of oversupply and the unsustainability of the great price rise in the first five weeks of 1637. None of the bulbs were actually available – they were all planted in the ground – and no money would be exchanged until the bulbs could be handed over in May or June. So those who lost money in the February crash did so only notionally: they might not get paid later. Anyone who had both bought and sold a tulip on paper since the summer of 1636 had lost nothing. Only those waiting for payment were in trouble, and they were people able to bear the loss.

No one drowned themselves in canals. I found not a single bankrupt in these years who could be identified as someone dealt the fatal financial blow by tulip mania. If tulip buyers and sellers appear in the bankruptcy records, it’s because they were buying houses and goods of other people who had gone bankrupt for some reason – they still had plenty of money to spend. The Dutch economy was left completely unaffected. The “government” (not a very useful term for the federal Dutch Republic) did not shut down the trade, and indeed reacted slowly and hesitantly to demands from some traders and city councils to resolve disputes. The provincial court of Holland suggested that people talk it out among themselves and try to stay out of the courts: no government regulation here.

 

Monkeys dealing in tulips. When the bubble bursts, at the far right, one urinates on the now worthless flowers. Jan Brueghel the Younger, ‘Satire on Tulip Mania’, c1640, CC BY-SA

Why have these myths persisted? We can blame a few authors and the fact they were bestsellers. In 1637, after the crash, the Dutch tradition of satirical songs kicked in, and pamphlets were sold making fun of traders. These were picked up by writers later in the 17th century, and then by a late 18th-century German writer of a history of inventions, which had huge success and was translated into English. This book was in turn plundered by Charles Mackay, whose Extraordinary Popular Delusions and the Madness of Crowds of 1841 has had huge and undeserved success. Much of what Mackay says about tulip mania comes straight from the satirical songs of 1637 – and it is repeated endlessly on financial websites, in blogs, on Twitter, and in popular finance books like A Random Walk down Wall Street. But what we are hearing are the fears of 17th-century people about a 17th-century situation.

It was not actually the case that newcomers to the market caused the crash, or that foolishness and greed overtook those who traded in tulips. But this, and the possible social and cultural changes stemming from massive shifts in the distribution of wealth, were fears then and are fears now. Tulip mania gets brought up again and again, as a warning to investors not to be stupid, or to stay away from what some might call a good thing. But tulip mania was a historical event in a historical context, and whatever it is, Bitcoin is not tulip mania 2.0.

Facebook, Google, Twitter Announce ‘Counterspeech’ Psyop to Keep Public Docile

 

Methinks the reason behind all this effort to curb extremism from these social media monopolies is simple, follow the money. Look at this statement, it shows that Google’s YouTube does not have to pay 30% of its users. That’s plenty of money. And they hide behind “for the good of humanity” bullshit:

“Starting at the end of last year, the company had already begun altering its algorithm so that 30% of its videos were demonetized. The company had explained that it wanted YouTube to be a safer place for brands to advertise, but the move has angered many content producers who generate income with their video channels.”

ANTIMEDIA

Written by Jake Anderson

January 18, 2018

If you’re a radical or search for “extremist” content online, the biggest social networks and internet companies on Earth will soon be converting you into a docile moderate, or at least, they will try.

Facebook, Google, and Twitter have been screening and filtering extremist content for years, but on Wednesday, the gatekeepers of the internet confirmed to Congress that they are accelerating their efforts and will target users who may be exposed to extremist/terrorist content, redirecting them instead to “positive and moderate” posts.

Representatives for the three companies testified before the Senate Committee on Commerce, Science and Transportation to outline specific ways they are trying to combat extremism online. Facebook, Google, and Twitter aren’t just tinkering with their algorithms to restrict certain kinds of violent content and messaging. They’re also using machine learning and artificial intelligence (AI) to manufacture what they call “counterspeech,” which has a hauntingly Orwellian ring to it. Essentially, their goal is to catch burgeoning extremists, or people being radicalized online, and re-engineer them via targeted propagandistic advertisements.

Monika Bickert, Facebook’s head of global policy management, stated:

“We believe that a key part of combating extremism is preventing recruitment by disrupting the underlying ideologies that drive people to commit acts of violence. That’s why we support a variety of counterspeech efforts.”

Meanwhile, Google’s YouTube has deployed something called the “Redirect Method,” developed by Google’s Jigsaw research group. With this protocol, YouTube taps search history metrics to identify users who may be interested in extremist content and then uses targeted advertising to counter “hateful” content with “positive” content. YouTube has also invested in a program called “Creators for Change,” a group of users that makes videos opposed to hate speech and violence. Additionally, the video platform has tweaked their algorithm to reduce the reach of borderline content.

In his testimony, Juniper Downs, YouTube’s head of public policy, said, “Our advances in machine learning let us now take down nearly 70% of violent extremism content within 8 hours of upload and nearly half of it in 2 hours.”

On the official YouTube blog, the company discussed how they plan to disrupt the “radicalization funnel” and change minds. The four steps include: 

• “Expanding the new YouTube product functionality to a wider set of search queries in other languages beyond English.

• Using machine learning to dynamically update the search query terms.

• Working with expert NGOs on developing new video content designed to counter violent extremist messaging at different parts of the radicalization funnel.

• Collaborating with Jigsaw to expand the ‘Redirect Method’ in Europe.”

Starting at the end of last year, the company had already begun altering its algorithm so that 30% of its videos were demonetized. The company had explained that it wanted YouTube to be a safer place for brands to advertise, but the move has angered many content producers who generate income with their video channels.

The effort to use machine learning and AI as part of a social engineering funnel is probably not new, but we’ve never seen it openly wielded on a vast scale by a government-influenced corporate consortium. To say the least, it is unsettling for many. One user commented underneath the post, “So if you have an opinion that’s not there [sic] agenda You are a terrorist. Free speech is dead on YouTube.”

For its part, Twitter’s representative told Congress that since 2015 the company had taken part in over 100 training events focused on how to reduce the impact of extremist content on the platform.

In a post called “Introducing Hard Questions” on its blog, Facebook discussed rethinking the “meaning of free expression.” The post posed a number of hypothetical questions, including:

• How aggressively should social media companies monitor and remove controversial posts and images from their platforms? Who gets to decide what’s controversial, especially in a global community with a multitude of cultural norms?
• Who gets to define what’s false news — and what’s simply controversial political speech?”

The three tech giants have been under intense scrutiny from lawmakers who feel the platforms have been used to sow division online and even recruit homegrown terrorists. While the idea of using an algorithm to fight extremism online is not new, a unified front of Facebook, Google, and Twitter has never collectively produced original online propaganda, the specifics and scope of which remain vague despite the companies’ attempts at transparency.

Only recently, in the 2012 National Defense Authorization Act (NDAA), was the use of propaganda on the American people by the government formally legalized. Then-President Barack Obama continued strengthening government propaganda at the end of his administration with the dystopic Countering Disinformation and Propaganda Act of 2017, which created a kind of Ministry of Truth for the creation of so-called “fact-based narratives.”

It appears that while the government continues to strengthen its potential to conduct psychological operations (psyops), it is also joining forces with internet gatekeepers that can use their algorithms to shape billions of minds online. While one may applaud the ostensible goal of curbing terrorist recruitment, the use of psyops for social engineering and manufacturing consent could extend far beyond the original intent.

The high cost of low corporate taxes: Canada’s Corporations pay less tax than you think

Meanwhile, about 850,000 Canadians use food banks monthly. Come on Justin, smarten up.

Canada’s biggest corporations are using complex techniques and tax loopholes to pay far less than the official corporate tax rate. A Toronto Star-Corporate Knights #investigation

Source: Canada’s Corporations pay less tax than you think | Toronto Star

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Marco Chown Oved Investigative reporter

Toby A.A. Heaps Corporate Knights

Michael YowData analyst, Corporate Knights

December 14, 2017

A deep dive into the financial statements of Canada’s biggest corporations shows these companies pay far less than the official corporate tax rate. 

For every dollar corporations pay to the Canadian government in income tax, people pay $3.50. The proportion of the public budget funded by personal income taxes has never been greater.

At a time when Prime Minister Justin Trudeau has made tax fairness a centrepiece of his government, the Toronto Star and Corporate Knights magazine spent six months poring over tax data to determine how much income tax corporations are really paying.

We found the amount of tax most big companies pay has been dropping as a proportion of their profits for years, and not only because the corporate tax rate has been cut repeatedly. Canada’s largest corporations use complex techniques and tax loopholes to reduce their taxes significantly below the official corporate tax rate set by the government.

Our analysis of the financial filings of Canada’s 102 biggest corporations shows these companies have avoided paying $62.9 billion in income taxes over the past six years.

The 2011-2016 audited financial statements of all large Canadian corporations (those worth more than $2 billion) reveal they paid an average of 17.7 per cent tax.

During that time, the average official corporate tax rate in Canada for this group of companies was 26.6 per cent.

That 8.9 per cent gap translates into tens of billions of dollars that could have been used to pay for the schools, roads, hospitals, police and paramedics we all rely on.

The accounting manoeuvres Canadian corporations perform to reduce their tax bills are legal. But complex reporting rules make it difficult to determine if a company is actually paying its fair share of taxes.

The Star/Corporate Knights analysis looked at the amount of taxes companies paid as a per cent of profits over a six-year period to even out yearly fluctuations. Big losses and investments happen, and may reduce a corporation’s tax rates in any given year, but consistently low tax rates can indicate a pattern of avoidance.

This project is the first comprehensive attempt to combine Canadian corporations’ audited financial statements with government data to quantify the extent of corporate tax avoidance — and determine how much it costs the rest of us.

“Some income simply is not taxed,” said Peter Spiro, an economist with the Mowat Centre, a public policy think tank at the University of Toronto. “The public policy question becomes: are these tax breaks or tax exemptions justifiable?”

At a time when stocks and corporate profits are near record highs, the federal government has targeted small private corporations, expecting to recoup an estimated $250 million in tax revenue by closing loopholes.

If Ottawa instead closed all the loopholes used by large corporations, it could collect 40 times more than that.

In an average year, the 102 biggest companies in Canada pay $10.5 billion less than they would if they paid tax at the official corporate tax rate.

“That gap is undermining the integrity of the tax system,” said Jordan Brennan, an economist with UNIFOR, Canada’s largest private sector union, which represents Star employees. “Once we establish what the rates are, you have to have enforcement mechanisms to make sure (corporations) pay them.”

“If the government closed that gap they stand to gain $10 billion every year. Think about what you could do with $10 billion each year. That’s a national child care program. That’s any government’s signature program. Even if you’re fiscally conservative, you could use it to reduce the deficit. That’s not an insignificant portion of revenue,” said Brennan.

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