COTW: Corps Stash Cash

One of the reasons there is so much joblessness in America is corporations are taking advantage of the casino economy by stashing profits rather than spending it on expansion of plant or workforce. Marx said this would be a feature of decadent capitalism, when money itself becomes a commodity. American corporations are now holding a record $1.73 trillion based on data from about 2300 companies compiled by Bloomberg. Companies are building up huge cash reserves due to rising production and cost savings, but also tax avoidance as ably demonstrated by Apple, Inc. It chose to float a bond rather than use its monstrous overseas pile of cash and have to pay taxes on it. The company avoided $9.2 billion in US taxes last year. Corporate capital expeditures have dropped 21% when compared to the final three months of 2012, marking it as the largest quarter to quarter drop since the depth of the Financial Panic of 2008. This, despite record low interests rates available to commercial borrowers.

The glaring message in these charts is that corporations are paying an increasing small amount of their profits in taxes with an ever shrinking share going to labor while the plutocrats are paid ever more in bonus. Meanwhile, the captains of enterprise are abetted in this plunder by a national government that is intent on printing more money than stars in the galaxy, further eroding consumer purchasing power. Call it slime aid: