Dodging Corporates Taxes? There Is An App For That.
October 2, 2012 7:31 AM   Subscribe

How Apple uses a Nevada based investment fund to (legally) avoid paying corporate tax on some of its massive profit.
posted by COD (135 comments total) 10 users marked this as a favorite

 
But at least they're not a Delaware corporation.

Every big company does stuff like this.
posted by tylerkaraszewski at 7:34 AM on October 2, 2012 [1 favorite]


Account Different
posted by Egg Shen at 7:34 AM on October 2, 2012 [5 favorites]


If you point out what is wrong with the system, you are called anticapitalist or anarchist and dismissed. If you point out what is wrong in a specific instance, they tell you everyone is doing it.
posted by Nothing at 7:39 AM on October 2, 2012 [105 favorites]


I just stumbled into the story via Anil Dash's Twitter feed. Everybody does it, and that is a problem. We should either not bother to tax profit, or close the loopholes and tax it more efficiently. But this system where the politicians can claim they are making their corporate buddies pay their fair share while they build in the loopholes to make sure they don't is bullshit.
posted by COD at 7:43 AM on October 2, 2012 [12 favorites]


Occupy Infinite Loop!
posted by rocket88 at 7:44 AM on October 2, 2012 [2 favorites]


If they paid more taxes than were legally due, I don't think they'd be qualified to become president.

Wait, who are we talking about again?
posted by Aquaman at 7:46 AM on October 2, 2012 [2 favorites]


Apple is a corporation. A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent. Pointing out such instances is weird unless it is in an attempt to get to change the law itself...
posted by asra at 7:51 AM on October 2, 2012 [2 favorites]


Going to the NY Times article reveals the answer to the question "how?": California’s corporate tax rate is 8.84 percent. Nevada’s? Zero. So they're dodging state taxes with this, not federal taxes.
posted by exogenous at 7:52 AM on October 2, 2012


Apple is a corporation. A part of its responsibility is to act within the law to reduce its tax burden...

A relentless focus on tax avoidance is not necessarily the only way to maximize shareholder value.
posted by COD at 7:54 AM on October 2, 2012 [12 favorites]


I hear that a feller caught a three-eyed catfish in the pond behind Apple.
posted by pracowity at 7:54 AM on October 2, 2012 [6 favorites]


Yeah, I find this a bit odd, as asra says. The framing of the fpp is sort of, I don't know, tongue in cheek editorializing about something that's legal....
posted by HuronBob at 7:54 AM on October 2, 2012


A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent.

Since when? Have shareholders ever successfully sued a corporation for not tax dodging successfully enough?
posted by saulgoodman at 7:54 AM on October 2, 2012 [5 favorites]


A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent.

Since when? Have shareholders ever successfully sued a corporation for not tax dodging successfully enough?


No one has ever been successfully prosecuted for necrophilia in my city. I'd still consider it the responsibility of the police to prevent such an action.
posted by Etrigan at 7:58 AM on October 2, 2012


Every company does this, but it's a particular thing in the tech industry because companies like Apple, Google and Microsoft tend to keep enormous amounts of cash on hand. Also they are international companies so there's plenty of room for tax arbitrage. Here's some 2011 articles on the IRS looking into Google and Microsoft and whether their tax strategies are legal. My guess is they substantially are.

The US corporate tax system is fairly broken. We have one of the highest corporate income tax rates in the world, but also so much tax avoidance that many companies pay zero or (for oil companies) negative taxes. There's a lot of arguments for overhauling the corporate income tax in the US by lowering the rate along with the deductions. But US tax code never gets simpler.
posted by Nelson at 8:00 AM on October 2, 2012 [6 favorites]


It would be nice if the Republican party would realize that being "business friendly" does not have to be the core of conservatism and indeed is probably, at this point in history, at odds with the protection of individual liberty and opportunity. A responsible opposition party could see this as a chance to push for a compromise on taxes that could include conservative-friendly simplifications without gutting revenus. Conservative writer David Frum had some tweets this morning along those lines:

Median income declined 4.1% during the recovery of 2009-2011. For most Americans, there has been no recovery at all.

Normally, such a bleak record would open a huge opportunity for the "out" party in an election year.

The trouble is, that this time the "out" party, the GOP, is championing only its own protected constituencies

I wish that somebody in GOP strategy room had looked at plan from POV of typical family & asked, Cant we offer them *SOMETHING*?

Romney camp wd answer, "We offer them growth via hi-income tax cuts." But median family won't believe that - why should they?

Maybe structure of modern globalized economy inevitably lowers incomes at middle in developed countries - possible.

But if so, case for social insurance becomes stronger, not weaker.

And then the party of capitalism must become also party of social insurance, for capitalism's own sake.

If globalization means lower wages for most voters and riches only for some, then democracy & capitalism become v uncomfortable together

If we want to save both, income-gainers will have to share proceeds with income-losers. In US, healthcare the obv way to do that.


Unfortunately the American Right are intent on dismantling every non-security portion of government.
posted by ghharr at 8:03 AM on October 2, 2012 [5 favorites]


Meanwhile, in Texas
posted by Bwithh at 8:04 AM on October 2, 2012


I used a New York based investment fund to (legally) avoid paying individual tax on some of my moderate profit. WHERE'S MY FPP?!
posted by nicwolff at 8:06 AM on October 2, 2012


Apple probably uses the money far more effectively and efficiently than the federal government would.
posted by shivohum at 8:07 AM on October 2, 2012 [2 favorites]


Ghharr, this isn't a right-left thing, and by bringing it up, you are playing into the ruse.

If the right didn't knee jerk oppose these things, and the left pretend to support them, then maybe a lot of Americans would realize its more of a Privileged v. Real Americans thing.
posted by Bathtub Bobsled at 8:09 AM on October 2, 2012 [1 favorite]


Ghharr, this isn't a right-left thing, and by bringing it up, you are playing into the ruse.


I don't think it's a party thing at all, I was using the right as an example because as the party out of the executive branch they have the opportunity to run against the status quo and present a conservative vision that would be beneficial to all Americans, but they have shown zero interest in doing that.
posted by ghharr at 8:12 AM on October 2, 2012


Apple probably uses the money far more effectively and efficiently than the federal government would.

True, but that's mainly because our government hasn't figured out how to offshore itself to China.
posted by Strange Interlude at 8:12 AM on October 2, 2012 [12 favorites]


A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent.

This is absolutely false. And if you seem to think this has something to do with shareholder value, I point you as I have pointed others to this short post.
posted by kenko at 8:12 AM on October 2, 2012 [6 favorites]


Bathtub Bobsled, Are those Real Americans the descendants of immigrant True Scotsmen?
posted by Longtime Listener at 8:12 AM on October 2, 2012 [5 favorites]


I'd still consider it the responsibility of the police to prevent such an action.

Do corporate officers no longer have the ordinary social responsibilities that apply to the rest of us by virtue of their positions? How far does this compartmentalization of moral responsibility go? Don't all members of a society/human beings still have the same social and moral responsibilities or does one's job trump one's identity as a human being? If so, if encouraging abortion to prevent maternity leave, for example, would help a company maximize its profits, is it obligated to encourage abortion?

Not to invoke the specter of the G-word, but this line of argument always reminds me of the "just following orders" defenses offered at Nuremberg. Humans don't stop being humans with all the moral and social responsibilities that come with being human just because they also hold a particular job.
posted by saulgoodman at 8:13 AM on October 2, 2012 [8 favorites]


We all do realize that every dollar that ends up in Apple's cash balance has already been taxed right? At the California rate or whatever corporate rate Apple is subject to. What we're talking about here is the tax on capital gains/interest income from Apple's $100bn cash balance. Effectively nothing compared to what they pay on their income statement

Apple's taxes over the last three years:
FY11 - 24% - $8.0bn
FY10 - 25% - $4.5bn
FY09 - 33% - $3.8bn

A reasonable assumption of tax payable on interest and gains from $100bn would be say, something like $450m annually assuming they returned 3% consistently, didn't take losses, and paid 15% on capital gains. How much did they actually pay? Why is this even an issue?
posted by loquax at 8:15 AM on October 2, 2012 [1 favorite]


Who can say but that people wouldn't flock to purchase products from a company that truthfully claimed that:

- its products aren't manufactured in sweatshops, even if that costs more!
- it takes an eye to the environmental consequences of the materials it uses, even if that costs more!
- in other respects too it takes the long view about how its actions affect the world and the country in which it's domiciled; for instance, it doesn't reduce its tax burden with a baroque corporate structure—even if that costs more!

And after all there are long-term consequences to widespread tax noncompliance in a country or state.
posted by kenko at 8:15 AM on October 2, 2012


What is the responsible approach to managing hundreds of billions of dollars in cash? Investing it in equities is classic capitalism and ostensbily keeps the economy liquid - lots of that money will go to keeping people in jobs with the concomitent payroll taxes and other economic benefits. If Apple took all of its dosh and, I dunno, bought an African country or two - what then?

I guess they could call it iStralia.
posted by Devonian at 8:16 AM on October 2, 2012


Do corporate officers no longer have the ordinary social responsibilities that apply to the rest of us by virtue of their positions?

Please define these "ordinary social responsibilities" and how they include "paying as much as possible to the government in the form of taxes." We can argue all day about whether this dodge should be legal, but it is, and failing to take advantage of it would be, on a corporate level, a failure of management.

Yes, there are companies that exist on a higher moral plane and reap some benefit from it. The largest companies in the world typically do not. You and I will have to agree to disagree that it is an inherent failure of these "ordinary social responsibilities".
posted by Etrigan at 8:19 AM on October 2, 2012 [2 favorites]


But at least they're not a Delaware corporation.

Apple the parent is a Delaware Corporation. Note: Being a Delaware Corporation is good.
posted by JPD at 8:23 AM on October 2, 2012


Also something like 55 bil of AAPL's cash is held offshore, so has not been taxed in the US. Braeburn being based in Nevada just means that the earnings from the reinvestment of US domiciled cash is not subject to California State Taxes.

Not an Apple fanboy, just explaining whats going on here. So figure about 60 bil in cash earning a what 3% return? so 180 mil in revenue, California Income tax rate is 8.84% so 16 mil or so in avoided taxes.
posted by JPD at 8:33 AM on October 2, 2012 [1 favorite]


Apple probably uses the money far more effectively and efficiently than the federal government would.

Possibly. However Apple doesn't pay teachers' salaries either. Being able to dodge taxes in the state their headquarters is in leads to situations like this.
posted by bonehead at 8:34 AM on October 2, 2012 [3 favorites]


So figure about 60 bil in cash earning a what 3% return? so 180 mil in revenue, California Income tax rate is 8.84% so 16 mil or so in avoided taxes.

Multiply all that by 10 - using your numbers, 60bn at 3% is 1.8bn in gains. Still irrelevant in the context of the actual tax paid on Apple's operations every year.
posted by loquax at 8:37 AM on October 2, 2012 [1 favorite]


oof. thats embarrassing
posted by JPD at 8:38 AM on October 2, 2012


Apple's just doing its job.

The villain here is the tax loophole. Close it.
posted by Sys Rq at 8:41 AM on October 2, 2012 [3 favorites]


And that 160 mil is about 2800 teachers etc...
posted by bonehead at 8:41 AM on October 2, 2012


Yes. No other company has ever done this.
posted by clvrmnky at 8:42 AM on October 2, 2012 [1 favorite]


However Apple doesn't pay teachers' salaries either.

That feels like a bit of a reach to me.

How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer). With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education. How many other California based companies can claim that. (and this doesn't include the taxes they DO pay, or the taxes paid by their employees, or the benefit of the jobs they create).
posted by HuronBob at 8:42 AM on October 2, 2012


Apple probably uses the money far more effectively and efficiently than the federal government would.

I was thinking about this very topic last night in the context of Food Service Industry. I've worked both for-profit chains & as a University cafetaria supervisor where we were profit is not a motive. You know where I'd eat any day of the week? The University cafeteria, where being all efficient and worrying about food cost is not our #1 concern. You know what our #1 concern was? Food safety & making the 8,000 student who came thru the food line daily happy with our food. Instead of spending time counting the mayonaise jars to make sure I wasn't over food budget or being ordered by some GM to scrape the 5-day old ketchup to put it with the rest of the ketchup that's been accumulating for who knows how long? I would spend time actually doing temp checks. Training staff on food safety. Ensuring food doesn't sit on the heating tray too long. Making sure everyone was wearing gloves, hair nets, etc. Things that get eliminated all in the name of efficiency.

How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer).

Yes, because no other competitor does this.
posted by jmd82 at 8:43 AM on October 2, 2012 [3 favorites]


The villain here is the tax loophole. Close it.

It isn't really a loophole though. You can't force them to do business in one state or another.

Besides the much much bigger loophole is the rest of their cash that lies offshore which has never been taxed. If you figure that's 55 bil that in its entirety should be taxed at the Federal rate.
posted by JPD at 8:45 AM on October 2, 2012


How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer). With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education.

This is such bullshit. Discounts are not donations. Apple still profits. Besides, the teachers would save a hell of a lot more money buying generic PCs instead.
posted by Sys Rq at 8:46 AM on October 2, 2012 [11 favorites]


If you point out what is wrong with the system, you are called anticapitalist or anarchist and dismissed. If you point out what is wrong in a specific instance, they tell you everyone is doing it.

The converse is true as well. If you point out that HP, IBM, Dell, etc do this it's "meh that's what companies do" and then if you point out Apple does it then it's a grave crime against all of humanity.
posted by Talez at 8:46 AM on October 2, 2012 [1 favorite]


I'm not getting the angle being played up by folks here. Apple is legally avoiding taxes, therefore...? Looks like Apple and I have something in common.

As far as I can tell, the story simply is simply that Braeburn is based in Reno rather than... somewhere else.
posted by 2N2222 at 8:47 AM on October 2, 2012


Possibly. However Apple doesn't pay teachers' salaries either. Being able to dodge taxes in the state their headquarters is in leads to situations like this.

California can't pay its teachers in part because it has $400 billion in unfunded pensions. If that's how irresponsible and spendthrift its government is, I don't see why putting more tax money into such a fundamentally broken system is necessarily a good thing.
posted by shivohum at 8:47 AM on October 2, 2012


I live in a state with high capital gains tax. Can I set up a hedge fund in another state just to avoid paying that tax?
posted by miyabo at 8:47 AM on October 2, 2012


As others have said, this isn't specifically about Apple, but about the tax policy that allows companies like Apple, which presumably are in California because the infrastructure there is what they want, including roads, police and schools, without having to pay to support it.

If the tax policy doesn't work, the high-tech sector, by managing it's higher cash holdings the way they are (legally) allowed to do, is a vampire on California, taking more out than they put in, getting a free ride on all the benefits of being in California without having to pay the full costs to support them.
posted by bonehead at 8:48 AM on October 2, 2012 [6 favorites]


asra: Apple is a corporation. A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent. Pointing out such instances is weird unless it is in an attempt to get to change the law itself...

I extrapolate this just a bit to mean that, the tactic of highlighting a legal act is a way to reveal certain absurdities built into "the system."

Then, yeah.

Everybody does it: No. I don't do it.

I suppose the tactic of voting with one's feet is appropriate, though. I know a guy who actually moved from Oregon to Nevada to avoid paying certain fees that Oregon requires of its businesses. He manufactures small trailers designed to be road-legal without having to register them with the DMV. He has it made in China. He also complained about how Oregon's schools suck. Their design is clever, and they are useful. He did nothing illegal either--just looking out for the business. Now, he doesn't put back into the system by offering discounts to certain customers, the way Apple does. I guess if I had to actually come to the goddam point, I would wonder if it would be possible to structure a business climate that didn't require expertise in avoiding regulations. Pointing out that Apple uses a bit of its excess capital better than the government does seems a bit slippery...reminds me of the argument that it was good to take over the American West because the Indians weren't really doing anything with it.
posted by mule98J at 8:52 AM on October 2, 2012 [2 favorites]


This is a double of the previous MeFi post "How (COMPANY/RICH PERSON) uses a (LOCATION/TAX LOOPHOLE)-based investment fund to (legally) avoid paying corporate tax on (SOME/MOST/ALL) of (ITS/THEIR) massive profit."
posted by EndsOfInvention at 8:52 AM on October 2, 2012 [1 favorite]


I live in a state with high capital gains tax. Can I set up a hedge fund in another state just to avoid paying that tax?

Yes. But you'd have to hold your interest through another corporation not domiciled in your state, and if that corporation paid you dividends or you sold your share for a capital gain you'd have to pay tax on it.

Which is exactly what happens to someone who lives in California and owns apple. Just that the middle Entity is Apple Inc. a Delaware Corp and AAPL doesn't pay a dividend so you'd only pay taxes when you sold.
posted by JPD at 8:52 AM on October 2, 2012


This is such bullshit. Discounts are not donations. Apple still profits.

Not to mention, educator discounts are bog standard with just about every big company.

Apple probably uses the money far more effectively and efficiently than the federal government would.

Ron Paul? Is that you?
posted by kmz at 8:54 AM on October 2, 2012 [1 favorite]


How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer). With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education.

Hey good idea, I have a budget of $0, so if I buy a Mac for $800-10% that means I have an extra -$720 to spend on educational sup- oh wait
posted by EndsOfInvention at 8:54 AM on October 2, 2012 [5 favorites]


I feel like I need to point out again that Apple has paid $28.8bn in total taxes on pre-tax profit of $109.5bn over the last 3 years and 3 quarters, for an average tax rate of 26.3%.

If you assume Apple has paid no tax (probably not correct) on the ~$2.5bn in returns their cash fund has made since inception (from the article), Apple's total tax rate goes down to 25.7%.

So what are we talking about again?
posted by loquax at 8:55 AM on October 2, 2012


HuronBob: "With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education."

It's not a donation. It's a very effective marketing tactic, even if they take a loss on teacher/educational sales (which they probably don't).

Having Apple hardware into schools gives Apple more visibility and attracts more lifelong customers than any ad campaign ever could. They could *give* the computers away, and it'd still be a good business decision for them.
posted by schmod at 8:55 AM on October 2, 2012 [1 favorite]


It's a very effective marketing tactic

It is also a form of price discrimination, which is perfectly normal profit-maximizing behavior.
posted by miyabo at 8:59 AM on October 2, 2012 [1 favorite]


Wait, Apple is GIVING away computers???!!!!!! Allright then!

do I have to go to Reno to pick it up?
posted by HuronBob at 8:59 AM on October 2, 2012


How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer). With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education.

How about this instead: Apply gives an iPad to every K-12 student in California. There are around 6 million students. Assume it costs around $200 to produce a mid-range iPad. That comes to around $1.2B total. A lot of money, but (i) it's a tiny fraction of cash on hand (and roughly equal to the Samsung judgment alone), (ii) it would create huge buzz/goodwill, and (iii) it would entrench Apple's ecosystem in an entire generation of the nation's largest state.
posted by brain_drain at 8:59 AM on October 2, 2012 [1 favorite]


Does apple lobby for these tax breaks or are they just taking advantage of the law as it is? It would be crazy to expect a company to donate money to the government. Just fix the law. Either California or Nevada could do something about it if they really wanted to.
posted by empath at 9:00 AM on October 2, 2012


tylerkaraszewski: "But at least they're not a Delaware corporation.

Every big company does stuff like this.
"


Just about every tax payer does stuff like this to one degree or another

The companies, people, and the general pubic who benefit from such large investments would say it was a good thing as well.
posted by 2manyusernames at 9:01 AM on October 2, 2012


They could *give* the computers away, and it'd still be a good business decision for them.

They actually did give them away in the 80s. I learned BASIC in first grade on my elementary school's free Apple II+.
posted by radwolf76 at 9:02 AM on October 2, 2012 [1 favorite]


I feel like I need to point out again that Apple has paid $28.8bn in total taxes on pre-tax profit of $109.5bn over the last 3 years and 3 quarters, for an average tax rate of 26.3%.


Its nitpicky but in that 16.64bn they reserved for taxes for FY09-11, about 5 bil is Deferred taxes where they reserved for them on their P&L but didn't send a check to the IRS. So the effective cash tax rate is <20%
posted by JPD at 9:02 AM on October 2, 2012


brain_drain: "How about this, Apple allows an educator discount (typically about 10% on a $1,000 computer). With about 300,000 teachers in California, that comes to a potential $30,000,000 "donation" in the interest of education.

How about this instead: Apply gives an iPad to every K-12 student in California. There are around 6 million students. Assume it costs around $200 to produce a mid-range iPad. That comes to around $1.2B total. A lot of money, but (i) it's a tiny fraction of cash on hand (and roughly equal to the Samsung judgment alone), (ii) it would create huge buzz/goodwill, and (iii) it would entrench Apple's ecosystem in an entire generation of the nation's largest state.
"


You would have the same result. Apple would be attacked for taking the tax break on the donation.
posted by 2manyusernames at 9:03 AM on October 2, 2012


> Apple probably uses the money far more effectively and efficiently than the federal government would.

"Our goal is to inflict pain. It is not good enough to win; it has to be a painful and devastating defeat. We're sending a message here. It is like when the king would take his opponent's head and spike it on a pole for everyone to see."
posted by boo_radley at 9:06 AM on October 2, 2012 [1 favorite]


The tax angle seems relatively meh: as JPD and loquax have pointed out, Apple's avoiding more or less modest capital gains tax on its investments. One would rather that businesses didn't do that, but there are lots of things businesses do -- even Apple -- that one would rather they didn't.

The scary bit to me is that one firm has $117B (and growing!) to throw around with no transparency whatsoever.
posted by notyou at 9:08 AM on October 2, 2012 [1 favorite]


The scary bit to me is that one firm has $117B (and growing!) to throw around with no transparency whatsoever.

The scary bit, to me, is that they don't seem to actually be investing that money in their products. I mean, $117 billion is enough to hire every software developer in the US for a year. There is absolutely no reason the Maps debacle should have happened, they should have thousands of mapping cars roaming the planet and 10,000 employees in India making the world's best maps. They should have a hundred new products in development at all times, they should be spinning off the ones that don't meet Apple's business model into dozens of new companies. They should have the best R&D department in the world making major fundamental tech advances left and right.

But they seem to be betting that it's better for them to stay relatively small and hold their profits in cash and stocks, which is pretty scary. What do they know about the economy that we don't?
posted by miyabo at 9:17 AM on October 2, 2012 [5 favorites]


This is just an example of why it is silly to tax corporations at the state level. If you want to tax corporations, do it at the national level. By the way, if the goal is to redistribute income from the rich to the poor, taxing corporations is a rather inefficient way to do it. Anyone who has a savings account pays corporate taxes, rich or poor. Redistribution is much more efficiently accomplished by taxing individual income -- not corporate income -- because then you can know for sure who it is you're taxing.
posted by thomisc at 9:21 AM on October 2, 2012


Hah, it's funny watching universes collide. "Apple is the best company ever!" and "Rich people owe all their money to the government!" are incompatible, and watching the little wheels spin is pretty amusing. Excuses get tossed out, and go unchallenged, that would never fly with, say, Monsanto, or Exxon-Mobil, or even General Motors. But because Apple is popular, well, it's okay if they do it.

If this is accurate:

FY11 - 24% - $8.0bn
FY10 - 25% - $4.5bn
FY09 - 33% - $3.8bn


then Apple's paying whacking huge sums of cash into the system, probably more last year than the lifetime taxes of every MeFi member, combined. California missing a chunk of it is irrelevant. Teachers are being paid for by the salaries paid to Apple employees, which are very high.
posted by Malor at 9:21 AM on October 2, 2012


A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent

And note that you, as a US Citizen, have the *right* to minimize your taxes in any legal way possible.

If you point out what is wrong with the system, you are called anticapitalist or anarchist and dismissed. If you point out what is wrong in a specific instance, they tell you everyone is doing it.

If you point out that Company X is doing something that all companies do to portray them in a negative light, then, well, you're a lying propagandist sullying the reputation of a company. If you truly were a journalist, you'd point out that this was common, indeed, generally accepted practice.

You can argue the practice is wrong. No problems there. But when you call out Company X, you're lying if you don't say that all large companies do so as well.

But, no, it's far more important to know that APPLE BUILDS STUFF IN CHINA, EVIL!!! and APPLE MINIMIZES THEIR TAXES, EVIL, and never mind that Google and Microsoft do as well.

The question is who paid for that story to be written and published, and how. Note, getting comped to a Google function because of you're known anti-Apple stand is getting paid.

A relentless focus on tax avoidance is not necessarily the only way to maximize shareholder value.

Yes, but you are required to maximize shareholder value in all ways possible. Avoiding capital gains taxation is a no brainer. Not doing so exposes Apple to shareholder lawsuits.

This is why all publicly held companies are evil. They are required to behave that way, and are punished if they do not.
posted by eriko at 9:22 AM on October 2, 2012


But they seem to be betting that it's better for them to stay relatively small and hold their profits in cash and stocks, which is pretty scary. What do they know about the economy that we don't?

It's mostly a leftover from the Jobs era.
He was, I think, a little paranoid about the Apple lean years where they essentially had to be bailed out by Microsoft.

Notice the first dividend for what, 20 years, now that Steve is gone. Also, rumor has it they are actively looking for ways to use the cash for something more proactive.
posted by madajb at 9:24 AM on October 2, 2012


> What do they know about the economy that we don't?
There's probably a bit of... call it corporate survivor's syndrome in Apple. They've had enough existential crises over the years that $117Bn may not seem like enough. As an analogy, my great-gram weathered the depression and even after things bounced back, after she bought the building she lived in and had multiple bank accounts for FDIC insurance purposes, still canned vegetables and collected string and cardboard just in case.

This isn't a defense in any case, but Apple probably can't even see that they could be the R&D driver as you describe it.
posted by boo_radley at 9:24 AM on October 2, 2012 [1 favorite]


Apple probably uses the money far more effectively and efficiently than the federal government would.

You know, I'm sitting here typing on a Mac Pro while I take calls on my iPhone 5 and when I take a break, I read a book on my retina iPad and play music that my AppleTV is streaming from my Mac Mini.

And I will say without any hesitation that, no, Apple will not make better use of the money than the federal government.

Apple is a company that makes computers, smartphones, tablets, and peripherals. The federal government, for all of its faults, is responsible for making sure that people don't starve to death when they get old, or die on the street when they lose their jobs and homes. I use Apple products to do my work because I really like how they work and how well they work together, but incrementally increasing the company's corporate profits is not a worthwhile tradeoff for starving the social safety net that exists in our country.
posted by verb at 9:24 AM on October 2, 2012 [15 favorites]


This is just an example of why it is silly to tax corporations at the state level.

This is why the states are a stupid idea that has caused the US nothing but misery for the entire history of this nation, and even before.

The reason you can game states is because they have different rules, and the markets see that and chose the rules that benefit them. Make it so there's no rule difference, and other factors, like education and quality of life, move to the fore.

Banks will always be in Delaware, because the rules are easy there -- and by incorporating there, you can ignore the 49 states that don't do it. States don't even have the power of tariff, which is the normal mechanism for fixing this -- you pay the tax here, or the tariff when you come here.

So, yeah, CA may not like it, but there's not a thing they can do about it.
posted by eriko at 9:27 AM on October 2, 2012 [1 favorite]


And I will say without any hesitation that, no, Apple will not make better use of the money than the federal government.

I can say without a doubt that Apple will not, so long as the US exists, spend that money on nuclear weapons or drone strikes on civilians in the middle east.
posted by eriko at 9:28 AM on October 2, 2012


I can say without a doubt that Apple will not, so long as the US exists, spend that money on nuclear weapons or drone strikes on civilians in the middle east.

Probably not, no. However, given the current political climate I think it's fair to say that revenue shortfalls don't result in less war -- they result in less safety net.

The conservative call to "starve the beast" doesn't result in less war, it results in the gutting of our social safety net to preserve the nation's warmaking abilities.
posted by verb at 9:29 AM on October 2, 2012 [2 favorites]


Please define these "ordinary social responsibilities" and how they include "paying as much as possible to the government in the form of taxes."

No. I won't play sophist games with you. I'm not going to accept that adults have no moral compass and/or can't understand as much about their social obligations as we expect of school children.

Exploiting legal technicalities to skirt the spirit of laws while strictly observing the letter is not sound ethical behavior, and even children should be expected to know that much. Our corporate culture in America is a disgrace.
posted by saulgoodman at 9:30 AM on October 2, 2012 [6 favorites]


Yes, but you are required to maximize shareholder value in all ways possible. Avoiding capital gains taxation is a no brainer. Not doing so exposes Apple to shareholder lawsuits.

Well, no, no they're not.
What they are legally obligated to do, from what I understand, is follow the articles of incorporation. Some companies explicitly state that maximum profit is not the goal of the company.
posted by madajb at 9:31 AM on October 2, 2012 [1 favorite]


Apple is a corporation. It is not a person ( no matter what the republicans might say). It does not have any "social" expectations. What it can and cannot do should be solely defined by what the laws say. I don't see why it has to justify any of its actions in any context other than in purely legal ones.
posted by asra at 9:31 AM on October 2, 2012


I can say without a doubt that Apple will not, so long as the US exists, spend that money on nuclear weapons or drone strikes on civilians in the middle east.

No instead they're spending it to help Foxconn put up new suicide prevention nets on their dormitory buildings. Very efficient and moral behavior.
posted by saulgoodman at 9:32 AM on October 2, 2012


They all do it, which is why states should have combined reporting.
posted by MikeMc at 9:32 AM on October 2, 2012


Apple is a corporation. It is not a person ( no matter what the republicans might say). It does not have any "social" expectations.

So who's making the decisions? A robot?

The actual people who make up Apple are still actually people, and unless you're arguing they're not, I don't see your argument here.
posted by saulgoodman at 9:32 AM on October 2, 2012


Large companies use money extremely inefficiently; they tend to give a lot of that money to individuals who by no stretch of imagination can be said to need it, or have any responsible or socially desirable use for it, and they also tend to not give money to their general workforce. It is this nickel-and-diming of workers, and offshoring into countries with lower standards of living, that is the problem. If they paid the workforce more, the workforce would pay taxes on that money, and those taxes would be used to maintain infrastructure.

There are many secondary benefits to high wages. People can start small businesses. They buy houses and cars and these become family assets. Their children are physically healthier and better educated. The crime rate and disease rate are lowered. Community bonds become stronger, as the middle class are able to spare money to help uplift and support the few poor.

This is basically an end-run around the problems of taxing corporations, which will (absent some complete left-field innovation in wealth tax) always be to some extent an exercise in nailing jelly to a wall. If they are forced to give more money to their workforces, whether local or international, simply as a condition of access to the society as customers, then the tax rate they pay becomes largely irrelevant. What are Apple going to do, not sell iPhones to first worlders? That is the handle by which they can be grasped: their need for access to customers, in order to sell them stuff.
posted by aeschenkarnos at 9:34 AM on October 2, 2012 [3 favorites]


Again, what if it's more profitable for a company to encourage its workers to have abortions (as actually happened at the US sweat shops on the Mariana Islands), is it the obligation of the corporation to force their pregnant employees to have abortions?
posted by saulgoodman at 9:35 AM on October 2, 2012


Comparing Apple to the U.S. government is silly.

One disappoints its customers by releasing new versions of its products that offer only modest incremental improvements over prior versions, failing to keep up with what its peers offer their customers.

The other is Apple.
posted by brain_drain at 9:37 AM on October 2, 2012


The actual people who make up Apple are still actually people, and unless you're arguing they're not, I don't see your argument here.

My argument is that the decisions they make when performing any official role is devoid of their personhood. Those actions should be strictly viewed in terms of black and white legality.

it makes no sense to have a moral discussion in this context.
posted by asra at 9:38 AM on October 2, 2012


The converse is true as well. If you point out that HP, IBM, Dell, etc do this it's "meh that's what companies do" and then if you point out Apple does it then it's a grave crime against all of humanity.

Nonsense. Most of the members here are fully aware that this is just an example of how the system can be used, yes, legally, and know full well that other companies do the same thing.
posted by juiceCake at 9:38 AM on October 2, 2012


I can say without a doubt that Apple, Exxon and other corporations will not, so long as the US exists, spend that money on buying politicians who will provide nuclear weapons or drone strikes on civilians in the middle east.

Awkward, I realize, but nevertheless, I FTFY.
posted by BlueHorse at 9:42 AM on October 2, 2012 [1 favorite]


Corporations are people, my friend!
posted by Mister_A at 9:44 AM on October 2, 2012


My argument is that the decisions they make when performing any official role is devoid of their personhood.

And my argument is that this is self-rationalizing nonsense. No one in society should ever be given a pass on being morally responsible, regardless of whatever hats they put on in their various roles in society.

it makes no sense to have a moral discussion in this context.

Of course it does. What doesn't make sense is claiming that impersonal forces of nature and/or some even higher law is responsible for business decisions made by real human beings.
posted by saulgoodman at 9:46 AM on October 2, 2012 [2 favorites]


Pointing to efficiency in private industry vs government is a clever reframe, and kind of a distraction here.

Apple can chose to be efficient. It can chose to offer one phone, one tablet, and two or three kinds of computers. It can chose to have one type of storefront. It can chose to not enter markets if it feels that profits aren't high enough or if it feels that those markets would distract it from its core strategy. Apple doesn't sell usb sticks or try to make musical instruments.

Governments can't chose what to do or not do, generally. They have mandates they have to at least try to meet. It is absolutely true that there is government waste and distorted spending, but the government, meaning the bureaucracy, doesn't get to choose to not run a granting program or pay teacher pensions. The politicians and the voters, ultimately, decide those things. Many times, like the Post Office, the government has to do inefficient things because that's what voters want.
posted by bonehead at 9:52 AM on October 2, 2012 [1 favorite]


Many times, like the Post Office, the government has to do inefficient things because that's what voters want.

That's as good an anti-government argument as any.
posted by shivohum at 9:54 AM on October 2, 2012


There's probably a bit of... call it corporate survivor's syndrome in Apple. They've had enough existential crises over the years that $117Bn may not seem like enough.

That, and that money in the bank is what let Apple gamble on things like the iPhone. If the iPhone flopped, Apple is nowhere near broke.

Look at Palm with the Pre. It *had* to work, it *had* to work well, and it *had* to be on time, or Palm was done.

It wasn't. They were.

Apple, like IBM and AT&T back in the day, could afford to spend money on things that may never make a single dollar. This gave them the opportunity to find things that, in fact, have made them a ton of money.

It also means that suppliers don't have much leverage. Apple's cash horde means they can do dramatic things. "Hmm, that costs too much (buy) there that's a reasonable cost per unit now!"

But, yeah, there was a lot of the dark time fear in that decision. That, and Tim Cook understands Warren Buffet when he calls cash a call option with no expiration date. Having cash means that when a good opportunity at a cheap price happens, you can grab it. That makes far more money than what you'd make on an investment, doubly so if it's one that leaves the capital hard to liquify.

Look at the markets. There's not a lot of good short term investments out there. Inflation is low, so you're not losing tons of purchasing power.

You can argue that Apple should pay more dividends. Why? To make the stock price more attractive to buyers? I think you'll find Apple stock is moving just fine, thank you. That's the reason for a dividend, after all. "If you own part of us, you'll get X. Doesn't that make you want to own part of us?" But plenty of people are paying a pretty steep price to own part of Apple. Why should Apple give away money to encourage something that's doesn't need encouraging?

Apple's products are from the impetus of Steve Jobs. Apple's ability to execute, cheap supply lines, and massive profitiablity selling very expensive gadgets is from the mind of Tim Cook, and the one reason I worry about Apple is I've seen this before.

Disney. Disneyland wasn't created by one man. It was dreamt up by one man, and one man insisted that it be insanely great. That man, of course, was Walt Disney. But there was the other guy who made it happen, that was Roy O. Disney. Roy was the money guy. Roy made it happen, somehow -- every time Walt came up with something, Roy would figure out how to make it actually happen, or help Walt find a version that could be made to happen.*

Walt dies. And, Disney starts to lose its magic. The movies that came out when Roy was chairman? Well, The Jungle Book wasn't bad, but was started well before Walt died. The other two? The Love Bug and The Aristocrats.

Roy was too buried trying to make WDW happen. He dies in 1971, and Disney fades further. The EPCOT opening is troubled. Disney is about to go under. They get a bailout, but the conditions are two -- they need to go back to movies, which they do best, and there needs to be a new leader. So, Disney is refunded and ressurected.

The resurrection was brought on by a similar team, Michael Eisner as CEO (as the idea guy) and Frank Wells as the president (and the execution guy.) 1984-1994 is a great time for Disney -- The Little Mermaid and Beauty and the Beast show they can still make movies. EPCOT is reworked and becomes a feature park, followed Tokyo Disneyland and by the seemingly un-Disney multi-studio Disney-MGM Stuidos (now Hollywood Studios). Alladin and The Lion King follow.

Then, Frank Wells dies in a helicopter crash. Frank Wells was the voice of sanity, of reason, of possibility, to Eisner's dreams. And he's gone. Instead, they hire Micheal Ovitz, who is anything but that person.

And, thus begins what is now commonly known as the Reign of Error.

You need two people, and they're opposites. You need the dreamer, and you need the person who's firmly anchored in reality.

Now, Apple's got the anchor, but I don't see a dreamer there. I hope they find one.



* Classic Example: Entering Disneyland or the Magic Kingdom. Walt wanted a curtain, clearly dividing the real world from the show. The problem -- how do you make that curtain work? How do you get crowds through it. Roy's answer? There are two smaller passageways, with low ceilings. They're not that small, or low, but they *feel* small and low, they're darkish on even a bright sunny day. And you walk through that passage, and when you leave the tunnel, Main Street USA opens before you, and the real world is gone.

Walt *loved* it. It was exactly what he wanted. Roy's gift, and Tim Cook's, was figuring out what Walt/Steve really *wanted*, and finding a way to make that happen. Walt didn't want a curtain. Walt wanted the reveal a curtain gave. Roy figured out how to do that without a reveal.
posted by eriko at 9:55 AM on October 2, 2012 [1 favorite]


Delaware court of Chancery has recently ruled that the Board of Directors has no duty to minimize its tax burden. See Freedman v. Adams (2012 WL 1099893)
posted by gagglezoomer at 10:04 AM on October 2, 2012 [1 favorite]


If they paid more taxes they wouldn't be able to pay the workers a fair wage to manufacture their goods, duh.
posted by Legomancer at 10:05 AM on October 2, 2012


Many times, like the Post Office, the government has to do inefficient things because that's what voters want what's necessary for society to function.

FTFY.
posted by kafziel at 10:06 AM on October 2, 2012 [1 favorite]


That's as good an anti-government argument as any.

Hey, let's privatize everything! That always works well!
posted by kmz at 10:06 AM on October 2, 2012


The Love Bug and The Aristocrats.

Yeah, that is a drastic change in direction.
posted by subtle-t at 10:07 AM on October 2, 2012 [2 favorites]


Many times, like the Post Office, the government has to do inefficient things because that's what voters want what's necessary for society to function.

If only...
posted by 2N2222 at 10:10 AM on October 2, 2012


And my argument is that this is self-rationalizing nonsense. No one in society should ever be given a pass on being morally responsible, regardless of whatever hats they put on in their various roles in society.

Why not? Your morals may suck.

Well, it turns out there is kind a way to deal with such things. They are called laws. And unless I'm missing something, it looks like the laws are being followed.
posted by 2N2222 at 10:12 AM on October 2, 2012


How about this instead: Apply gives an iPad to every K-12 student in California. There are around 6 million students. Assume it costs around $200 to produce a mid-range iPad. That comes to around $1.2B total. A lot of money, but (i) it's a tiny fraction of cash on hand (and roughly equal to the Samsung judgment alone), (ii) it would create huge buzz/goodwill, and (iii) it would entrench Apple's ecosystem in an entire generation of the nation's largest state.

Microsoft does this. There is a West Philadelphia charter school that was their pilot for this program, if I recall.
posted by Blazecock Pileon at 10:13 AM on October 2, 2012


That's as good an anti-government argument as any.

The only reason the Post Office isn't still making profits while it performs its core constitutionally established functions anymore is because anti-government political interests in Washington changed the way the USPS has to calculate its pension obligations, requiring it to fully fund all its current and future obligations 75 years in advance--a standard no other public or private entity is held to and that in effect instantly put the USPS hopelessly in the red.

The USPS is a vital public resource all the same and the vast majority of people continue to use it and depend on it to this day. There's hardly anything more fundamentally American than the USPS, from the early Pony Express days when the USPS united the frontier states to its ongoing role in delivering Social Security and other benefits to senior citizens who depend on them. It's amazing to me how much some people take for granted. Educated people who ought to know better.
posted by saulgoodman at 10:16 AM on October 2, 2012 [9 favorites]


Why not? Your morals may suck.

Evidently.
posted by saulgoodman at 10:17 AM on October 2, 2012


Hey, let's privatize everything! That always works well!

Or... here's a thought: let's make government -- particularly California -- make do with the money it has instead of constantly grasping for more. Let's implement restrictions so that special interest groups couldn't exercise so much power, and voters couldn't pass unfunded referenda. Let's reform the gargantuan, unaffordable, unfunded public sector pensions strangling the future. Let's make it easier to fire unproductive workers. Let's cut spending on criminalizing non-violent drug offenses. Let's make the business environment as inviting as possible. Let's force government to actually live within its means. What a thought.

And my guess is if government could show that it could operate efficiently and transparently, people might just be a little more willing to support higher taxes. They'd have a little more confidence that their money was being spent wisely.
posted by shivohum at 10:23 AM on October 2, 2012 [1 favorite]


miyabo: " I mean, $117 billion is enough to hire every software developer in the US for a year. There is absolutely no reason the Maps debacle should have happened"

Actually, I think they were trying to scoop up every talented GIS developer in the country for a while. There have been murmurings of an Apple Maps product for quite a few years now based on the number of geographers who were suddenly relocating to Cupertino.

The problem is that Apple's secretive nature might have prevented them from getting the best of the best, and also prevented them from revising the product once people realized it sucked. I've been getting a sneaking suspicion that cracks are beginning to show in Apple's user testing process. They've made too many universally-hated UI decisions in recent years for me to believe that their testing program is anywhere nearly as effective or rigorous as it once was. (Also, none of this would have happened if iOS was an open platform.
posted by schmod at 10:46 AM on October 2, 2012


shivohum: let's make Apple make do with the money it has instead of constantly grasping for more. Why do you prefer unaccountable, private legal entities to (at least theoretically) accountable public ones?
posted by saulgoodman at 10:49 AM on October 2, 2012 [3 favorites]


(Also, none of this would have happened if iOS was an open platform.

As a senior developer/architect who works with large open source projects, I can tell you categorically that "Openness" does not magically prevent bad UI decisions.
posted by verb at 10:53 AM on October 2, 2012 [4 favorites]


Why do you prefer unaccountable, private legal entities to (at least theoretically) accountable public ones?

For one thing because I believe in private property and liberty. I think people have the right to create companies, innovate, and sell products and services to people who voluntarily exchange money for them.

Whereas government is a coercive set of institutions, though admittedly necessary for some things, overlaid on top of that.

And private entities are accountable to the market, which in Apple's case (and in the tech sector generally) has proven to be wildly productive of incredible innovation -- it's a kind of accountability that is often far more powerful than the very blunt instrument of ballot-box accountability.
posted by shivohum at 11:16 AM on October 2, 2012


You should spend some time in places where private corporations actually murdered and enslaved people or overthrew governments.
posted by empath at 11:19 AM on October 2, 2012 [1 favorite]


I can tell you categorically that "Openness" does not magically prevent bad UI decisions

I think the idea is that, if iOS were an open platform, you could just install Google Maps on your iOS 6 device. Android allows you to install any app you want straight from a file, you just click a button to allow "unauthorized sources". Google can't stop you.

That said, I don't think this holds up to scrutiny because Apple owned the Google Maps app. Even if the platform were open, it would be violating Apple's copyright to distribute it outside the app store.

If Apple and Google were to have a huge tiff and Apple pulled the Gmail app from the app store, then openness would really be the issue.
posted by miyabo at 11:25 AM on October 2, 2012 [1 favorite]


Allowing tax avoidance schemes like this isn't being friendly to business -- it's being friendly to very large corporations. Small and medium businesses cannot afford the lawyers and infrastructure to set up such tax avoidance. So it's highly anti-competitive, in that it's an extreme disadvantage for any start-ups or newcomers into any industry.
posted by parudox at 11:26 AM on October 2, 2012 [1 favorite]


Its really not very expensive actually. The real issue is that most small businesses don't have income of this character.
posted by JPD at 11:34 AM on October 2, 2012


For one thing because I believe in private property and liberty.

Give me a break. No you don't.
posted by saulgoodman at 11:35 AM on October 2, 2012


shivohum: "Apple probably uses the money far more effectively and efficiently than the federal government would."

Well, if you consider money sitting on a balance sheet doing nothing to be effectively and efficiently used, I suppose that's true. Personally, I consider it effectively and efficiently not used.

Anyway, it never ceases to amaze me how many people trot themselves out as apologists for the companies involved in sleazy tax avoidance techniques, always telling us to blame the system, not the beneficiaries. This despite (most of) the beneficiaries paying quite handsomely to get their special little loophole written into the tax code. Don't treat them as if they're just innocent players playing by the rules that were handed down from on high. They make the rules they play by. That's why the rule book is so fucked up. It's not because politicians are stupid, it's because they are bought.
posted by wierdo at 11:56 AM on October 2, 2012 [2 favorites]


What is it with the hard-on otherwise sane people have for Apple?

(Does anyone have any pointers to good/accessible studies on brand/product loyalty, its motivations and pathologies? I'm curious what the actual motivations are and what their genesis is.)
posted by maxwelton at 11:58 AM on October 2, 2012 [1 favorite]


Apple probably uses the money far more effectively and efficiently than the federal government would."

At what? Building roads? Paying for soldiers to go to college? Providing food stamps to a single mom?
posted by empath at 11:59 AM on October 2, 2012 [1 favorite]


asra: "Apple is a corporation. It is not a person ( no matter what the republicans might say). It does not have any "social" expectations. What it can and cannot do should be solely defined by what the laws say. I don't see why it has to justify any of its actions in any context other than in purely legal ones."

This amoral "morality" is very weird in its prevalence. What is it with people saying that the legislated bare minimum is what we should all aim for?
posted by wierdo at 12:00 PM on October 2, 2012


What is it with the hard-on otherwise sane people have for Apple?

Varies from person to person. Some like their products' design aesthetic, some have emotional attachment from the days when they learned to type on an old Apple II with Mavis Beacon, some don't have a "hard-on" at all, and just happened to buy products that other people have a hate-on for.

It's a complicated world, you know?

(Does anyone have any pointers to good/accessible studies on brand/product loyalty, its motivations and pathologies? I'm curious what the actual motivations are and what their genesis is.)

They make a suite of products that I like, and use daily as part of my work and recreation. Some people swear by Zappos. Some swear by Honda. Some swear by the deli down the corner. Some do it for rational reasons, others for irrational reasons. I'm not sure what is served by trying to pathologize brand preference.
posted by verb at 12:07 PM on October 2, 2012 [3 favorites]


You should spend some time in places where private corporations actually murdered and enslaved people or overthrew governments.

You should spend more time in the many more places where governments did these things and worse. Really, neither proves anything about the state of affairs in the US today. Things are situation- and sector-dependent and time-dependent.

Building roads? Paying for soldiers to go to college? Providing food stamps to a single mom?

Actually, yes, probably, since none of these things happen without a vibrant economy, jobs, and tax base.
--
Well, if you consider money sitting on a balance sheet doing nothing to be effectively and efficiently used, I suppose that's true.

Apple's not keeping its money under a mattress. It's invested in things. It's circulating in the economy.

--
Give me a break. No you don't.

Interesting. How do you figure?
posted by shivohum at 12:11 PM on October 2, 2012


What is it with the hard-on otherwise sane people have for Apple?

(Does anyone have any pointers to good/accessible studies on brand/product loyalty, its motivations and pathologies? I'm curious what the actual motivations are and what their genesis is.)
posted by maxwelton at 1:58 PM


That cuts both ways. Right now Apple is the Yankees of the tech industry. People love them, or hate them. Would any company in the world doing something legal attract so much attention? Probably not. On metafilter? Definitely not.

You don't think there are plenty of comments in this thread that are only here because the commenter dislikes Apple? Anything Apple does is huge news, whether good or bad. A lot of the good is driven by those that love Apple, the bad by those that have a definite dislike for the company. You only have to look at the Foxconn story, where many, many companies are involved, but only Apple gets mentioned.
posted by justgary at 12:15 PM on October 2, 2012 [3 favorites]


You should spend more time in the many more places where governments did these things and worse. Really, neither proves anything about the state of affairs in the US today. Things are situation- and sector-dependent and time-dependent.

So before you said that corporations are freedom and liberty and the government is tyranny and coercion, and now it's all relative. Interesting. Seriously, try living somewhere with a weak central government and powerful corporations for a while. It's not pleasant.
posted by empath at 12:22 PM on October 2, 2012 [1 favorite]


A part of its responsibility is to act within the law to reduce its tax burden to the maximum possible extent

And note that you, as a US Citizen, have the *right* to minimize your taxes in any legal way possible.


The trouble is that large corporations have this uncanny knack for...er...encouraging lawmakers to pass laws that, surprisingly, rip new, enormous holes in the tax system.
posted by Skeptic at 12:35 PM on October 2, 2012 [2 favorites]


Interesting. How do you figure?

It's just obvious. "Might Makes Right" (whether its economic or military might) is not a system that promotes liberty for most people. It entrenches and deepens generational imbalances in freedom. History has proven this point again and again.

Imperfect as it may be, our constitutional democratic republic is the only legal corporation that every American (at least theoretically) owns an equal stake in merely by virtue of citizenship.

Private property and wealth protection alone are not sufficient to create liberty; historically, feudal systems offered plenty of both, and yet, those systems are still rightly remembered as among the most oppressive and restrictive of personal liberty the world has ever known. Among the first multinational privately-held companies were those that established the slave trade (and who were granted monopolies under the authority of the descendants of the private feudal landholders who eventually became the European aristocracy).

It seems to me that if you really cared about liberty you wouldn't so consistently ignore or dismiss the many historical examples of the role private interests can and have played in denying it to so many, especially in the absence of a powerful, publicly-interested counterweight to their otherwise unchecked power.
posted by saulgoodman at 1:36 PM on October 2, 2012


Saint Apple and Steve Jobs is its prophet? What about St.NASA? What about St.Primary Research?

Yeah Nasa boring, basic research boring, Iphone cool and "In my pocket" , as opposed to the rover on mars, who cares about Curiosity. It makes _some_ sense, but what the hell did Apple do for you actually, except being incredibly good at selling you their gadgets?

Moreover, what in the world make some people think that Apple using a tax shelter is good because it's legal? Killing people is legal in some states, does that make killing good?

And the sense of uberentitlement: Apple deserves a megabreak on taxes because they give jobs (to Foxcon, in China, anyhow) and create cool gadgets, using nothing but thin air and selling it to people who consume nothing to create everything, again from thin air.
posted by elpapacito at 2:10 PM on October 2, 2012 [1 favorite]


If corporations are people and have a right to purchase media to influence politics, why don't corporations pay income tax on their profit? If you give them the right to meddle in politics they can pay income tax like other people do. Save the business tax rate for small concerns like mom and pop stores and independent businesses.
posted by pdxpogo at 2:12 PM on October 2, 2012


Don't hate the playa.
posted by sciurine at 2:35 PM on October 2, 2012


except being incredibly good at selling you their gadgets?

Except being incredibly good at making gadgets I want to buy.

Better.

You can make your point without resorting to the tired and cliched 'it's all marketing' rhetoric.
posted by justgary at 2:49 PM on October 2, 2012 [1 favorite]


I think the idea is that, if iOS were an open platform, you could just install Google Maps on your iOS 6 device.

Until Google cuts your access off. Google Maps, as an application, is merely an interface to the Google server farms. If Google doesn't give you access to the TbT database, you get no turn by turn directions. If Google won't serve you vector information, you get no vector tiles.

The app on the phone is just a display terminal. The real smarts are in Google's hands, and you use them if, and only if, Google lets you.

Why do you think Apple made the new Maps? Apple wanted vector tiles, because of the huge bandwidth savings. Google let Android have vector tiles, and refused to let Apple have it. Apple wanted turn-by-turn navigation. Android's Google Maps had that, but Google wouldn't let Apple use it. Apple's contract with Google to ensure the current access to Google Maps expires in mid 2013. It was very clear that Google's terms were going to be very onerous, and there would still be no turn by turn, not vector tiles, massive personal info transfer to Google, and so forth.

They could wait, and pray, or they could do the smarter thing, which is get the product out now and start the interative improvement process that all Apple products have used. Far better than waiting until the last minute, only to find you don't have a product. At the very best, you get the same reaction you do now -- you get yelled at. If that's your best, why wait?

Apple's mistake, of course, was made back in 2007, when they chose Google Maps, thus putting a critical function of Apple's flagship product into Google's hands. At the time, it seemed safe -- Eric Schmidt was on Apple's BoD, after all. But it was a critical mistake.

And, you know, the more I use it, the more I realize that it is better than Google Maps on the iOS platform. It is vastly faster and it's routing uses traffic info better. Google's transit info in Chicago was a joke -- yes, they knew the routes, but they didn't factor traffic. 24 minutes from Kedzie to the Brown Line on the Diversey Bus at 5PM? Try 24 minutes to Western!

Is Google Maps on the web better? Yes. It almost certainly is better on Android than Apple Maps is on iOS. But the feature crippled Google Maps on iOS? No. I think Apple Maps is better, and is getting better by the day. And furthermore, they're using a better base dataset. I think, within a year, Apple Maps will be better than Google Maps on *any* platform in every current feature set. Heck, I know the aerial views are newer -- I can see my current car at my current house, not my old car at my old house.

Seriously, try it. Get something with iOS 5.x, and do a map lookup. The moment you hit go, grab an iOS 6 device and do that search in Apple Maps. Apple Maps is wicked fast. Google Maps on iOS is a heap of shit in comparison, speed wise.

Yeah, the 3d view is stupid, but that's true of *everybody's* 3-d view. What, are you a helicopter pilot?
posted by eriko at 3:50 PM on October 2, 2012 [3 favorites]


Something tells me, until Apple fixes their maps, no one will be able to steer the conversation away from them.
posted by Dark Messiah at 4:24 PM on October 2, 2012 [1 favorite]


While they're at it, they can put Siri on the iPad 2.
IOS6 has been a huge disappoint.
posted by rocket88 at 8:27 PM on October 2, 2012


Dark Messiah: "Something tells me, until Apple fixes their maps, no one will be able to steer the conversation away from them."

Just gonna softball 'em in like that, huh?
posted by boo_radley at 11:11 PM on October 2, 2012


Holy crap, people. Pay attention to the difference between state and federal taxes. Apple paying $20 billion to the federal government doesn't do anything to replace the money not being paid to California. However, Apple's employees will be paying state taxes there so the state is probably still earning a lot off of them.
posted by delmoi at 12:07 AM on October 3, 2012 [1 favorite]


I think the idea is that, if iOS were an open platform, you could just install Google Maps on your iOS 6 device.

...Isn't the fact that Google hasn't released a version of Google Maps for iOS yet the big holdup on that front? iOS being an open platform wouldn't magically make Google write a new version of their Maps app.

I'm annoyed by the new Maps app, too. The Google Maps app that shipped with iOS 5, though, was definitely showing grievous signs of age and was falling dramatically behind the Android mapping/directions experience. I'd been using Waze, a third party mapping program, for turn-by-turn directions for a little over a year.

On preview, I think we agree. I love the edit window.
posted by verb at 8:42 AM on October 3, 2012


eriko: "And, you know, the more I use it, the more I realize that it is better than Google Maps on the iOS platform. It is vastly faster and it's routing uses traffic info better. Google's transit info in Chicago was a joke -- yes, they knew the routes, but they didn't factor traffic. 24 minutes from Kedzie to the Brown Line on the Diversey Bus at 5PM? Try 24 minutes to Western!"

Google relies on transit agencies to publish accurate schedules. If traffic isn't being factored in, that's CTA's fault. Google's transit stuff is actually an open standard, given that the data is (by definition) very much outside of Google's control. Any competitors are welcome to grab the GTFS feeds from the agencies themselves.

While the standardization is great, it's also a pitfall that makes it difficult to add new features. Namely, nobody's figured out how to reliably incorporate real-time arrival information (ie. NextBus) in with the timetable-based directions. It's a difficult problem from both a usability and computational perspective. How do you generate accurate directions from a timetable that is constantly shifting? You could track on-time performance and make estimates based off of that, but if the transit agencies have access to that same information, you'd assume that they'd use it to improve the accuracy of their timetables (thus removing the need for Google to do the same thing).

It's a sticky problem, and nobody seems to have come up with a nice solution. Transit services have lots of idiosyncrasies, and it's difficult to account for them all in a standardized manner.
posted by schmod at 10:00 AM on October 3, 2012


verb: "...Isn't the fact that Google hasn't released a version of Google Maps for iOS yet the big holdup on that front? iOS being an open platform wouldn't magically make Google write a new version of their Maps app."

Wouldn't such an app be rejected by the App Store, as it duplicates native functionality bundled with the OS?
posted by schmod at 10:00 AM on October 3, 2012


Wouldn't such an app be rejected by the App Store, as it duplicates native functionality bundled with the OS?

Not if it's from Google. App Store restrictions are applied idiosyncratically, based in large part on how famous the submitter is. Witness all the people whose apps were pulled, then reinstated after they riled up folks on blogs.
posted by kafziel at 10:06 AM on October 3, 2012


You could track on-time performance and make estimates based off of that

So a couple of years ago, I had to commute using a bus that stopped right in front of my house every 30 minutes. The problem was that the bus was ridiculously unreliable. It seemed like every day, I'd leave my house 5 minutes early, and just miss the bus as it was leaving my doorstep. Or the bus would be 5 minutes late, I'd run inside to grab a hat or something, and miss the bus while I was inside for 30 seconds. It was so close to being functional transportation that I couldn't justify getting a car, but it still sucked.

So I wrote a script to repeatedly poll my city's NexTrip page, and parse the HTML results to figure out when the bus was going to arrive. The eventual goal was to ring an alarm or something when the bus was almost there. But as a first draft, I just had it continuously poll the NexTrip web page and record the results, to see how often the bus was late/early and by how much.

I ran the script all night. In the morning, I discovered that someone at the transit agency had decided my script was a DOS attack, and they had blocked my IP address on their entire web site.

Oops.
posted by miyabo at 10:21 AM on October 3, 2012


Wouldn't such an app be rejected by the App Store, as it duplicates native functionality bundled with the OS?

No one really knows except Apple, it's at their whim. See also the year long delay for Google Voice and the ongoing mystery of Google voice search on iPhone. The iPhone is the very definition of a closed platform: Apple has absolute contractual control on what applications are allowed on the device and they use that power to benefit their own products. I'm OK with that tradeoff, I have 4 iOS devices in my house myself, but it's always a tradeoff.
posted by Nelson at 3:38 PM on October 3, 2012


Wouldn't such an app be rejected by the App Store, as it duplicates native functionality bundled with the OS?

Some categories are treated differently. There are, for example, dozens of mapping and direction-finding applications in the App Store now. The Maps app also provides an API via which developers can register their own app as a mapping/direction-finding app in iOS 6, to provide navigation styles or hyperlocal directions that the native Maps app doesn't provide.

Also, on the iTunes store, Apple is doing a high-profile promotion of other mapping tools like Waze, Navigon, and so on to deflect anger about the native Maps app.

There's definitely a problem with inconsistently applied iOS store policies, but in the category of mapping in particular there's always been a wide open space for apps that do directions, mapping, local transit integration, and so on.
posted by verb at 9:07 AM on October 4, 2012


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