A short excerpt from A Brief History of the Corporation: 1600 to 2100 by Venkat on June 8, 2011
If you thought it was bad enough that Dick Cheney used to work for Halliburton before he took office, imagine if he’d worked there while in office, with legitimate authority to use his government power to favor his corporate employer and make as much money on the side as he wanted, and to call in the Army and Navy to enforce his will.
That picture gives you an idea of the position Robert Clive found himself in back in 1757. He made out like a bandit. That was a full 150 years before the American corporate barons earned the appellation robber.
The first Coca-Cola Company incorporated on March 24, 1888 and the first commercial sale of bottled Coca-Cola took place in early 1891 when the bottling was done in Vicksburg, Mississippi at the Biedenharn Candy Company.
The first outdoor wall advertisement that promoted the Coca-Cola drink was painted on the wall of the Young Brothers Pharmacy in 1894 in Cartersville, Georgia. By then Coke concentrate (Coke syrup) was sold separately at pharmacies in small quantities, as an over-the-counter remedy for nausea or a mildly upset stomach.
Vintage ads like the one pictured below suggested that Coca-Cola claimed some of these curative properties. The "Relieves Fatigue" slogan on this Schenectady New York wall dates back to the early 1900's.
It was during this time when the era of the robber barons was winding down, and in 1909 the People of the United States imposed its first corporate tax of 1% on companies like Coca-Cola.
By 1969, the year that America had first landed a man on the moon, the corporate tax rate on large corporations such as Coke was as high as 52.8%, until eventually by1994, it was lowered to the current rate of 35% --- albeit, with a lot less loopholes than today.
Three years later in 1997 the Coca-Cola Company passed the "one billion a day" mark in sells of bottled Coke --- and it was not until 14 years after that, did the CEO of Coca-Cola falsely claim that his company found it easier to do business in China and Brazil than in the United States because of our antiquated and unfair tax code:
“If you talk about an American company doing business in the world today with its Chinese, Russian, European or Japanese counterparts, of course we’re disadvantaged. A Chinese or Swiss company can do whatever its wants with those funds [earned overseas]. [But] when we want to bring them back, we are faced with a very large tax burden.” ~ Mukhtar Kent, CEO Coca-Cola, 2011
Republicans had seized on Kent’s comments, including Virginia Governor Bob McDonnell who had said that he was “staggered” by Kent’s comments and decried that it should be a “wakeup call” to Washington.
But in actuality, Coca-Cola enjoys very low federal taxes, and pays a lower tax rate than most Americans. According to Citizens for Tax Justice, in 2011 the company’s federal tax expense was $470 million, which was only 6.5 percent of the $7.2 billion in pre-tax profits that Coca-Cola reported that year. It's odd that Coke's CEO would complain about taxes when the statutory corporate tax rate hadn't been lower than what Coke paid for over 100 years.
That’s a very low tax rate for Coke, and it certainly does call for reforming the tax code, though not in the way that those such as Coke's CEO wants it "reformed". On top of that, the company actually told Citizens for Tax Justice that they had paid a 38% tax rate --- which is more than the statutory corporate rate of 35%; but Coke would not release any documentation backing up their bogus claim.
Part of the reason that Coca-Cola pays such a low tax rate is that it parks profits in overseas tax havens like the Cayman Islands. The company has saved $500 million in some years by hiding profits there. It's these overseas profits that actually gets to the heart of what Coke's CEO is really after—he mentions that Coca-Cola cannot bring those profits back without a “very large tax burden.”
The repatriation of overseas earnings is a big issue for multinational corporations based in America because, if they want to bring back profits made overseas, they must pay the standard 35% tax rate (minus any other tax loopholes that Congress has since granted them over the last few decades).
In 2004, big business got Congress to approve a repatriation holiday in which overseas profits could be brought back and taxed at a 5.25 percent rate instead of 35 percent. It was sold as a "jobs-creating" measure and implied that companies would bring back a lot of overseas money, which would spur investment and jobs in the U.S. (*cough-cough-clear throat*)
At that time a lot of overseas profits did come back, but unfortunately—yet predictably—the jobs never materialized. The Congressional Research Service later found that “little evidence exists that new investment was spurred.” In fact, a comprehensive study found that 92 percent of the money that was brought back was used to enrich their institutional shareholders (e.g. Bain Capital, Goldman Sachs, etc.) and their company executives.
Moreover, many of the companies that participated in the repatriation ended up laying off workers in the following months and years. On top of that, many of these companies—including Coca-Cola—now have much more money parked overseas than they did before the repatriation holiday. Coca-Cola repatriated $6.1 billion of the $9.8 billion it had in overseas profits in 2004—but as of 2011, the company has $20.8 billion parked overseas, more than triple that amount.
So, what Coke's CEO Muhktar Kent was really saying is, although his highly profitable company’s already-low federal tax rate is abetted by hiding profits overseas, he’d also like to bring back those profits at an outrageously low rate so that his company can get even richer. Otherwise, they’ll keep their money in China, or Brazil, or wherever --- and this will certainly help his shareholders, which is his only true motivation.
Now we're also hearing that Coca-Cola, the world’s largest beverage
suing to crush the world’s best recycling program.
Coke claims that they can't afford to pay their fair share of taxes, but when the government of Australia's Northern Territory considered creating a 10-cent refund on recycling plastic bottles, Coca-Cola poured millions of dollars into a misleading campaign to oppose the plan. But after the people Down Under had decided, the plan had passed --- but then Coke sued the government to stop the program. Coca-Cola runs similar campaigns all over the world.
These days Coca-Cola sells nearly 2 billion plastic bottles every day, and
there is already a Texas-sized island of un-recycled plastics in the Pacific
Coke "says" it supports recycling, and it even has a special website to advertise how much it cares. But all over the world, Coca-Cola opposes public programs that encourage people to recycle plastic bottles. If Coke was really serious about recycling, it needs to start supporting recycling programs, not suing sovereign nations to stop them.
The recycling program Coke is suing over is called a “container deposit scheme,” (a “bottle bill” in the United States), but it shouldn't cost Coca-Cola anything. Instead, consumers pay an extra ten cents for each bottle, which they can get back by recycling the used container. But Coke claims that recycling programs are a " tax" that hurts its sales. So far, Coke's competitor, PepsiCo, hasn't sued a country yet.
In 2003 Coke announced that it would cut staff by about 1,000 people, or 4% of staff. It was Coca-Cola's second major layoff, with the first coming in 2000 when 5,200 people were let go (a typical company doing more with less.)
In 2010 Coca-Cola Enterprises, the biggest bottler of Coca-Cola beverages, said it was going to layoff another 5% of its work force, or about 3,800 jobs. And last year in France workers were set to go on strike claiming that more layoffs were fundamentally unfair while Coke was enjoying growing global profits.
Just last month Coca-Cola Refreshments USA Inc announced that it will close its Sheboygan production facility, leaving 40 employees jobless, according to a letter to the Wisconsin Department of Workforce Development. "You can assume over time that our presence in the United States, in terms of employees, will go down a bit," said chief executive John Brock.
And a few of those unemployed Coke employees might want to supplement their incomes "a bit" by collecting discarded plastic Coke bottles for ten-cent refunds.
Today, and maybe because efforts around the country to impose taxes on high-sugar drinks --- and because of Mayor Michael Bloomberg’s move to restrict the sizes of sodas sold in New York City --- Coke is now spending millions of dollars on a ridiculous P.R. campaign fighting back against the public's growing awareness of obesity, diabetes and tooth decay.
“This is not about changing the products, but about confusing the public,” said Michele R. Simon, a public health lawyer who writes frequently about the food and beverage business and its role in public health issues on her blog Appetite for Profit. “They are downplaying the serious health effects of drinking too much soda and making it sound like balancing soda consumption with exercise is the only issue, when there are plenty of other reasons not to consume too much of these kinds of products.”
Here's the HONEST Coke commercial.
But Coke isn't alone, not as it pertains to dirty tricks, phony PR campaigns, tax avoidance schemes, and overall poor corporate governance, when they are supposed to be our "pillars of the community". This has become the "norm" for the corporate culture --- massive profits at any cost to people, sovereign governments, or to the global environment --- just to enrich a handful of people at the top, such as those who sit on their shared board of directors.
These CEOs sometimes forget that it's governments around the world that ALLOW their corporations to exist and remain in business, and that it's not a Constitution Right. And none of these CEOs were ever endowed with (or ENTITLED to) any inalienable right to receive multi-million dollar annual salaries. It's only a privilege, one that they constantly abuse, by using "limited liability" granted in corporate charters to avoid responsibilities and to put them essentially all above the law.
In 2011, during the aftermath of the Great Recession --- in the middle of massive layoffs, foreclosures, and government cuts ---- Coke's CEO Muhtar Kent did not make any "shared sacrifices". He saw his total compensation rise 17.5% to $29.1 million that year, as did Coke's Chief Financial Officer, Gary Fayard, who saw his total compensation increase 3.1% to $8.5 million.
Over a 5-year period, Muhtar Kent, the current CEO of The Coca Cola Company, made over $40 million. A study by the Institute for Policy Studies reports that John F. Brock, the current CEO of Coca Cola Enterprises, earned $19.1 million in 2011 --- and that his salary alone was more than what Coke had paid in federal income taxes that year --- when Coca Cola’s net revenues saw robust growth in the billions of dollars, while it also had four subsidiaries in tax havens.
These corporate executive officers, such as those at Coke, also pay a low capital gains tax on their stock options in their executive compensation packages (paying 20% or less on their AGI, instead of the top marginal rate of 39.9% as on regular wages). In other words, they all pay a lower tax rate than Warren Buffett's secretary --- but yet, congress REFUSES to change this in the tax code because Coke, as well as all the other larger corporations, lobbies Congress and contributes to their congressional campaigns for favorable tax laws in return.
Yet still these CEOs complain about "high taxes" (and 10-cent refunds on plastic bottles). It seems that it's true: enough is never enough for these people. Their greed is like an addiction: "Wealth is like sea-water; the more we drink, the thirstier we become." ~ Schopenhauer
When will the members of our Congress and state politicians (just as any other country's national and local political leaders) stop caving in to the unreasonable demands of the CEO's of these multi-national corporate conglomerates? When will our elected "representatives" stop giving in to the CEO's approach of using "sticks and carrots" --- using threats of jobs-for-tax breaks, just like they do when holding jobs as hostages for less governmental regulation?
Especially when it's become so blatantly apparent for several decades that these executive corporate officers' ONLY considerations have consistently shown to be ONLY for profits to further enrich themselves.
No matter how little or how great they are taxed, nor how many or how few regulatory laws are passed, nothing will ever keep them from doing everything possible to maximize their profits --- and well over 100 years of history has proved this --- since the days of the Robber Barons. Wars were started for profits, but with the exception of Afghanistan an Iraq, there were also war taxes on excessive profits.
The Campaign to Stop Killer Coke originated to stop the gruesome cycle of violence against union leaders and organizers in Colombia in efforts to crush their union, SINALTRAINAL. Since then, violence, abuse and exploitation leveled against Coke workers and their communities have been uncovered in other countries as well, notably China, El Salvador, Guatemala, India, Mexico and Turkey...where Coke is probably getting better tax breaks.
But now Coke is waging a war on the people and our allies in Australia. It's a good thing these CEOs don't have their own army or navy!
Historical Corporate Tax Rates
(Paid by Major Corporations in U.S.)
|1950||Over $25,000 (Add Surtax of 19%)||
|1950||Excess Profits Tax||
|1951||Over $25,000 (Add Surtax of 22%)||
|1951||Excess Profits Tax||
|1952||Over $25,000 (Add Surtax of 22%)||
|1952||Excess Profits Tax||
|1953-1963||Over $25,000 (Add Surtax of 22%)||
|1964||Over $25,000 (Add Surtax of 28%)||
|1965-1967||Over $25,000 (Add Surtax of 26%)||
|1968-1969||Over $25,000 (Add Surtax of 26%)||
|1970||Over $25,000 (Add Surtax of 26%)||
|1971-1974||Over $25,000 (Add Surtax of 26%)||
|;1975-1978||Over $50,000 (Add Surtax of 26%)||
Other Previous Coke Slogans
1886 - Drink Coca-Cola
1904 - Delicious and Refreshing
1905 - Coca-Cola Revives and Sustains
1906 - The Great National Temperance Beverage
1917 - Three Million a Day
1922 - Thirst Knows No Season
1923 - Enjoy Thirst
1924 - Refresh Yourself
1925 - Six Million a Day
1926 - It Had to Be Good to Get Where It Is
1927 - Pure as Sunlight
1927 - Around the Corner from Everywhere
1929 - The Pause that Refreshes
1932 - Ice Cold Sunshine
1938 - The Best Friend Thirst Ever Had
1939 - Thirst Asks Nothing More
1939 - Whoever You Are, Whatever You Do, Wherever You May Be, When You Think of Refreshment Think of Ice Cold Coca-Cola
1942 - The Only Thing Like Coca-Cola is Coca-Cola Itself
1948 - Where There's Coke There's Hospitality
1949 - Along the Highway to Anywhere
1952 - What You Want is a Coke
1956 - Coca-Cola... Makes Good Things Taste Better
1957 - Sign of Good Taste
1958 - The Cold, Crisp Taste of Coke
1959 - Be Really Refreshed
1963 - Things Go Better with Coke
1969 - It's the Real Thing
1971 - I'd Like to Buy the World a Coke (part of the "It's the Real Thing" campaign)
1975 - Look Up America
1976 - Coke Adds Life
1979 - Have a Coke and a Smile
1982 - Coke Is It!
1985 - We've Got a Taste for You (for both Coca-Cola & Coca-Cola classic)
1985 - America's Real Choice (for both Coca-Cola & Coca-Cola classic)
1986 - Red, White & You (for Coca-Cola classic)
1986 - Catch the Wave (for Coca-Cola)
1987 - When Coca-Cola is a Part of Your Life, You Can't Beat the Feeling
1988 - You Can't Beat the Feeling
1989 - Official Soft Drink of Summer
1990 - You Can't Beat the Real Thing
1993 - Always Coca-Cola
2000 - Coca-Cola. Enjoy
2001 - Life Tastes Good
2003 - Coca-Cola... Real
2005 - Make It Real
2006 - The Coke Side of Life