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Amazon Poised To Get Cut of CA Sales Taxes

timothy posted more than 2 years ago | from the unfettered-free-market-free-of-cronyism dept.

Government 295

theodp writes "Eager to host Amazon warehouses and receive a cut of the tax on sales to customers statewide, the LA Times reports that two California cities are offering Amazon most of the tax money they stand to gain. After agreeing to collect California sales taxes beginning in the fall, Amazon is setting up two fulfillment centers in San Bernadino and Patterson, which will gain not only jobs but also a tax bonanza: Sales to Amazon customers throughout California will be deemed to take place there, so all the sales tax earmarked for local government operations will go to those two cities. The windfall is so lucrative that local officials are preparing to give Amazon the lion's share of their take as a reward for setting up shop there. 'The tax is supposed to be supporting government,' said Lenny Goldberg, executive director of the California Tax Reform Assn., of the proposed sales-tax rebate. 'Instead, it's going back into Amazon's pocket.' Sen. Mark DeSaulnier added: 'It seems like the private sector finds a way to pit one city against the other. You can't give away sales tax in this manner.'"

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recipe for corruption (5, Insightful)

bigdavex (155746) | more than 2 years ago | (#40063079)

Special tax deals for individual companies is a recipe for corruption.

Re:recipe for corruption (4, Insightful)

mwvdlee (775178) | more than 2 years ago | (#40063145)

It's not like a small start-up competitor for Amazon wouldn't get these same tax cuts in these same cities, right? Right? Please tell me I'm right.

Re:recipe for corruption (1)

Anonymous Coward | more than 2 years ago | (#40063163)

:(

Re:recipe for corruption (4, Interesting)

N1AK (864906) | more than 2 years ago | (#40063235)

A company comes to you and says you can have 5,000 jobs and $20,000,000 as long as you give them $15,000,000 back. That's a tempting offer and you can hardly blame the towns for considering it. Someone comes to you offering 10 jobs and a worn out $5 it's not worth the effort. It's not corruption it's the cost of allowing internal variation in tax and rebates.

The hidden costs of these deals (5, Insightful)

KingSkippus (799657) | more than 2 years ago | (#40063351)

Yeah, it sounds like a good deal except that a lot of towns are ignoring the hidden costs of these deals. That huge company is going to require a lot of extra government services in the forms of things like electricity, water and sewer, roads, etc. Plus with the extra people, it's going to require more of things like fire nad police services, welfare benefits, unemployment benefits, public parks, postal services, yadda yadda yadda. What looks like a $5,000,000 bonanza, when all is said and done, ends up costing the taxpayers a crapton of money.

These deals ought to be illegal, period. Government at all levels, from federal all the way down to local, should be prohibited from making sweetheart deals to one company without making them for all companies. It would have to be a federal law, since there's no way in hell that cities or states would make such laws on their own. That's the only way that the playing field could be leveled for everyone. Maybe now that corporations are "people," some small companies should get together and sue using the Equal Protection Clause, under the theory that government is prohibited from offering Company X a sweetheart deal that Company Y, Company Z, and every other company doesn't have access to. It's a little like selling bus tickets to the Smiths for $2 each and selling the same bus tickets to the Johnsons for $8.

There is no telling how many trillions of dollars aren't being collected from companies because of deals like this, how much money is being sucked out of local municipalities' and states' coffers and being paid by people who live nowhere near where the money eventually ends up.

Re:The hidden costs of these deals (1)

gsgriffin (1195771) | more than 2 years ago | (#40063459)

I want to agree with you, but not knowing exactly what resources are available today in those cities,I would tend to bet there are many large buildings vacant, lot less cars on the road, police and firemen being laid off, and people in that city that could use a job (and will pay taxes themselves, if they have an income). I just haven't hard as many cities complain about their financial loss because a big company came into town and started paying taxes. Its more often the other way around.

Re:The hidden costs of these deals (-1)

Anonymous Coward | more than 2 years ago | (#40063511)

Non-lawyers who think they understand law are worse than non-techies who think they understand computers.

Re:The hidden costs of these deals (0)

KingSkippus (799657) | more than 2 years ago | (#40063793)

Non-lawyers who think they understand law are worse than non-techies who think they understand computers.

Lawyers who think they have a monopoly on good legal ideas are worse than techies who think they are the only ones who should be allowed to use computers.

Re:The hidden costs of these deals (1)

dkleinsc (563838) | more than 2 years ago | (#40063585)

Government at all levels, from federal all the way down to local, should be prohibited from making sweetheart deals to one company without making them for all companies.

Well, here's the problem with that: Congresscritters are very very good at drafting legislation that only applies to 1 company even though in theory it applies to everybody. For instance, they might pass a law that gives a sweet deal to all business that run search engines in Mountain View, CA - for legal purposes, that isn't specific, but in practice it is.

Re:The hidden costs of these deals (1)

KingSkippus (799657) | more than 2 years ago | (#40063773)

In cases like that, the courts would have to step in and strike such laws down, kind of like how they do now when a state tries passing some law that is unconstitutional. Someone would have to say, "Hey, that law is obviously designed to give a sweetheart deal to Google," and sue.

Re:The hidden costs of these deals (4, Interesting)

characterZer0 (138196) | more than 2 years ago | (#40063849)

There is a simpler solution. Get rid of property taxes and corporate taxes and tax capital gains as income. This will break the argument that corporations are citizens and make governments pay attention to where the money is coming from - the people.

Re:The hidden costs of these deals (1)

V-similitude (2186590) | more than 2 years ago | (#40063851)

It's not a cost on the cities/towns that take the deal. They got to negotiate (with the entire state's tax revenue) how much they'll need to make it worth their while. Plus the jobs are always a big plus these days. I highly doubt the little costs you mentioned are going to cause it to be a loss for them.

On the other hand, it is a huge net loss for the state as a whole. Every other city is losing out on tax revenue, despite still providing roads and such that Amazon needs for deliveries. (And infrastructure for its website.)

Re:recipe for corruption (1, Informative)

Dcnjoe60 (682885) | more than 2 years ago | (#40063243)

It's not like a small start-up competitor for Amazon wouldn't get these same tax cuts in these same cities, right? Right? Please tell me I'm right.

You are right. A small start-up competitor or any retail business, for that matter, would have access to this.

Re:recipe for corruption (1)

nedlohs (1335013) | more than 2 years ago | (#40063269)

Sure they would. If that small startup will bring as many jobs and as much revenue with them as Amazon will.

Re:recipe for corruption (1)

bigdavex (155746) | more than 2 years ago | (#40063625)

Talks with Amazon about a so-called sales-tax rebate are still in the early stages.

Amazon is negotiating a special deal. If everyone gets the same special deal, it's not a special deal (just the law) and no one has to negotiate it.

The fact that they are negotiating tells us that they are not applying the tax code uniformly.
 

Re:recipe for corruption (1)

Anonymous Coward | more than 2 years ago | (#40063197)

Meh. It's just cities outcompeting each other into the ground for jobs and tax revenue. Nothing to see, move along.

Cities do this the world over. When plebeians eventually wake up and refuse to foot the bill in one area, our corporate overlords start anew in another.

Not really (2)

Dcnjoe60 (682885) | more than 2 years ago | (#40063237)

Special tax deals for individual companies is a recipe for corruption.

Not really. It's a hold over from the days when sales tax first started. States let businesses keep a portion of the sales tax to cover the costs of calculating it and remitting it. Back then, there were no computers and the like. However, the laws were never updated so, today, it is a windfall for them. But it isn't a "special tax deal." In the 40s, it made sense. Today, it doesn't. But then again, it does negate the notion that it is too expensive for online businesses to collect and remit sales/use tax when they actually would be getting paid to do so.

Re:recipe for corruption (1)

Quiet_Desperation (858215) | more than 2 years ago | (#40063335)

Well, no worries, then.

The California state government is already completely corrupt.

Re:recipe for corruption (1)

garyoa1 (2067072) | more than 2 years ago | (#40063707)

On the other hand, we really don't have enough corruption in government today.

California sucks with taxes (0)

Anonymous Coward | more than 2 years ago | (#40063083)

Don't know the full reason/details, but my company will not travel to california, and often turns down deals with california companies because they are such a nightmare to work with.

 

Re:USA sucks with taxes (0)

Anonymous Coward | more than 2 years ago | (#40063127)

The same could be said almost verbatim for US firms in many parts of the world.

Yes, you can... (2)

JoeMerchant (803320) | more than 2 years ago | (#40063085)

You can't give away sales tax in this manner.

If Amazon were decent about it, they'd refund it to the customers.

Re:Yes, you can... (0)

Anonymous Coward | more than 2 years ago | (#40063113)

You can't give away sales tax in this manner.

It's done all the time.

Re:Yes, you can... (1)

Dcnjoe60 (682885) | more than 2 years ago | (#40063257)

You can't give away sales tax in this manner.

If Amazon were decent about it, they'd refund it to the customers.

Many would argue that the discount a business gets from collecting sales tax is already figured into the pricing of their products as it impacts their bottom line.

Re:Yes, you can... (5, Insightful)

Trepidity (597) | more than 2 years ago | (#40063289)

As far as I can tell, empirically this doesn't really happen: when FAA taxes were suspended for a bit recently, due to a Congressional screw-up when it came to reauthorizing the agency to collect the fees, airlines didn't lower their fares, they just pocketed the savings as higher profit margins.

Another way of putting it is that profit margins, like almost everything else, aren't completely fixed, so tax hikes and tax cuts don't necessarily get passed through to retail prices, but instead may modulate profit margins (or other things, such as employee pay).

Re:Yes, you can... (1)

h4rr4r (612664) | more than 2 years ago | (#40063393)

Many would be wrong. The price is already set at what the market will bear, why lower it?

Costs have very little to do with price.

Re:Yes, you can... (1)

gl4ss (559668) | more than 2 years ago | (#40063669)

Many would be wrong. The price is already set at what the market will bear, why lower it?

Costs have very little to do with price.

..dodging the tax was originally how amazon managed to do their market takeover in the first place. don't pretend it had no effect on pricing.

Re:Yes, you can... (1)

Celarent Darii (1561999) | more than 2 years ago | (#40063697)

undoing bad mod

Re:Yes, you can... (1)

gl4ss (559668) | more than 2 years ago | (#40063617)

..where do you think their lower pricing comes from, thus their competitive edge? it's bullshit for all amazon competitors though!

Honestly (1)

Rangelus (1766356) | more than 2 years ago | (#40063087)

What could possibly go wrong?

That explains it (2)

John Jorsett (171560) | more than 2 years ago | (#40063109)

I thought Amazon folded rather abruptly on the CA sales tax issue after having put up a big fight for years. Now I know why. Look for this deal to be cut in other states as well.

Re:That explains it (2)

Formorian (1111751) | more than 2 years ago | (#40063309)

If CA Taxes work like they do in NY (I'm was a tax auditor) I still don't get why they folded.

How it works in NY. Let's say the average county in NY is 8% (it's all over from 7 to 9), 4% goes to the state right away. The other % (besides NYC) goes to the county, in NYC the next 4% (at least it used to be 8.75) goes to the city, .75% goes to the MTA or something like that.

So let's say the county is giving back 90% to Amazon, but that's only 3.6% going back to Amazon out of the 8%. And the county is only keeping .4%. Unless they have a deal with the state, which I doubt.

Re:That explains it (0)

Anonymous Coward | more than 2 years ago | (#40063595)

If CA Taxes work like they do in NY (I'm was a tax auditor) I still don't get why they folded.

You am was a tax auditor?

Re:That explains it (1)

aaarrrgggh (9205) | more than 2 years ago | (#40063611)

The state gets 8% of sale the city gets 1%. The city is "giving back" nearly 100% of their 1% of sales.

The summary is miserable, and I haven't read TFS, but usually this happens in the form of property tax breaks, and not a "refund" of collected taxes from other people. Slightly less corrupt... but only slightly.

If you want to know why your taxes are so high (5, Informative)

Overzeetop (214511) | more than 2 years ago | (#40063119)

If you want to know why your taxes are so high you only need to look at the deals which are given to major corporations to attract and retain their business. It's getting to be a bit like CEO compensation packages. Will the best ones make you money - sure. But that money is collected from everyone else - essentially a tax increase on the everyman.

The fact that governments are pitted against one another just means that the downward spiral will continue, as each locality offers to unlevel the playing field to favor their locality.

Re:If you want to know why your taxes are so high (1)

alen (225700) | more than 2 years ago | (#40063159)

so why should people living hundreds of miles away pay your town's taxes?

Re:If you want to know why your taxes are so high (1)

CrimsonAvenger (580665) | more than 2 years ago | (#40063201)

so why should people living hundreds of miles away pay your town's taxes?

Probably for much the same reason as a business based in another State should be required to collect your town's taxes...isn't that the argument that was made in order to get Amazon to collect CA sales taxes at all?

Re:If you want to know why your taxes are so high (0)

Anonymous Coward | more than 2 years ago | (#40063359)

as a business based in another State should be required to collect your town's taxes

Except that by opening an office in the state, you're no longer "based in another state".

And if you're going to play the "wholly separate company not controlled by Amazon" you should probably have told Bezos not to go mouth off to the news about how if his company is forced to pay taxes on it, he'll close that facility that he supposedly has no control over.

Re:If you want to know why your taxes are so high (1)

Dcnjoe60 (682885) | more than 2 years ago | (#40063267)

so why should people living hundreds of miles away pay your town's taxes?

Well, it could be because the infrastructure to ship all of those goods people are buying from Amazon and other online retailers is supported by sales tax. I'm assuming that Amazon's warehouses and office need police and fire protection, schools for their employees children and roads for the trucks to drive on, but I could be mistaken.

Re:If you want to know why your taxes are so high (0)

Anonymous Coward | more than 2 years ago | (#40063473)

Here in Washington state, we primarily have sales tax, property tax, and B&O tax. Property tax is based on the location of the business. As regressive as the tax is (for low-income homeowners at least), property taxes should be able to take care of those needs you mentioned (albeit in California). Sales tax is to where the product goes, more or less. That is, if shipped, based on the address to which it is shipped, and if bought at a brick-and-mortar store, to that location.

If someone lives in a bedroom community and if sales taxes are based solely on the business location (as opposed to how it is done here in Washington state), then you could have a community relying mostly on property taxes for everything.

Typing this up at 6:12am, I may have made some mistakes.

Re:If you want to know why your taxes are so high (0)

Anonymous Coward | more than 2 years ago | (#40063339)

In free markets, the downward spiral is called "efficiency", i.e. you don't keep paying $10,000 for a computer, instead you pay $500 and it's 100 times better. ZOMG RACE TO THE BOTTOM!

Some people hate competition, they are usually the ones that can't compete.

Re:If you want to know why your taxes are so high (2)

SlippyToad (240532) | more than 2 years ago | (#40063343)

If you want to know why your taxes are so high

Taxes in the US are almost the lowest in the developed world [taxpolicycenter.org] . So, I don't really want to know more about something that isn't true.

This doesn't look like a tax to me -- it looks like a government-imposed profit fee for Amazon. Perhaps they should dispense with the fee entirely.

Re:If you want to know why your taxes are so high (2)

FlopEJoe (784551) | more than 2 years ago | (#40063621)

And that profit fee is on top of the U.S. corporate tax rate being the 1st or 2nd highest in the developed world [huffingtonpost.com] . Does anyone think they eat those rates or don't try to offshore jobs and manufacturing?

Re:If you want to know why your taxes are so high (2)

operagost (62405) | more than 2 years ago | (#40063797)

It's highly unlikely that chart includes local tax data, like property tax. In fact, considering how much state income tax varies, I highly doubt that was taken into account.

Re:If you want to know why your taxes are so high (1)

misexistentialist (1537887) | more than 2 years ago | (#40063887)

Not surprising that taxation is different than in tiny socialist welfare states. But that doesn't mean it isn't too high by normal standards.

Re:If you want to know why your taxes are so high (0)

Anonymous Coward | more than 2 years ago | (#40063469)

If you want to know why your taxes are so high you only need to look at the money that politicians are spending.

Don't blame Amazon (4, Insightful)

gstrickler (920733) | more than 2 years ago | (#40063125)

Blame the design of the tax laws, and the city officials who are willing to give huge tax breaks to major businesses. We see this type of thing all the time in the building of major sports facilities. It's welfare for billionaires.

Re:Don't blame Amazon (1)

alen (225700) | more than 2 years ago | (#40063155)

so make your town like most of fly over country. nothing. and a good job is considered working at wal mart

Re:Don't blame Amazon (4, Insightful)

thomasw_lrd (1203850) | more than 2 years ago | (#40063311)

Its not really though. They will tax the employees. This is how the city makes additional tax revenue. That's what it really all about. Plus all the residual services that new job bring.

People only bring up the issue at hand, they aren't considering what is really happening.

It's much the same with the whole X amount of billionaires don't pay any taxes on their income. The news media doesn't report that's because they give 90% of the money to charitable causes, or what not. It's the residual effects of their money that makes the biggest difference, not the fact that they don't pay X amount of taxes.

Re:Don't blame Amazon (1)

Trepidity (597) | more than 2 years ago | (#40063329)

There is somewhat of a move in California towards removing local shares of tax collection, in part because of too many special-case deals like this where the money gets used like a slush fund. Although many are a lot more corrupt than this one; this is clearly special-case, but it's fairly transparent. Local redevelopment agencies were recently all-but-eliminated in last year's state budget, for example, partly to close the state's budget gap by taking back the money, but also partly because local redevelopment agencies had become notoriously corrupt slush funds for politicians, politically connected construction contractors, and real-estate speculators to divvy up.

The downside to that is that sometimes local politicians really do know better what the local needs are than Sacramento does, so can be more responsive. But overall California's municipal and county governments have not given anyone much confidence, even compared to the not-great-either state government.

Re:Don't blame Amazon (1)

Walterk (124748) | more than 2 years ago | (#40063883)

Yes, your honour, don't blame me! She was asking for it, wearing a short skirt and everything..

Public money (1)

athe!st (1782368) | more than 2 years ago | (#40063131)

Can local government just "give" money back like this? Seems like it's public money, surely it can't just be given to a private company?

Re:Public money (1)

hendridm (302246) | more than 2 years ago | (#40063287)

Solyndra, and countless others...

Re:Public money (2)

Dcnjoe60 (682885) | more than 2 years ago | (#40063293)

Can local government just "give" money back like this? Seems like it's public money, surely it can't just be given to a private company?

Almost all states allow the retailer to keep a portion of the sales tax collected to cover the cost of calculating and remitting it to the state. Your local Walmart gets this deal, too, as does your local family owned business. Of course, it made more sense prior to computers when it was a manual process to tally up all of the sales calculate the taxes prepare the statements and remit them to the state than it does today. But that would be a different argument.

Re:Public money (0)

Anonymous Coward | more than 2 years ago | (#40063407)

Can't be public money until the government has it. Which.. it wouldn't be able to get, since Amazon wouldn't be building there without the concession.

There isn't anything special about most tax jurisdictions. Especially when you're not talking about a brick and mortar retail location. So jurisdictions get to compete. And there isn't a whole lot for them to compete with. Just like with internet ad networks, you are not the customer. So you don't reap the benefits of the competition.

Re:Public money (1)

cdrudge (68377) | more than 2 years ago | (#40063431)

Can local government just "give" money back like this? Seems like it's public money, surely it can't just be given to a private company?

Sure. Happens all the time. Often it's a tax abatement. The community or state agrees to reduce or eliminate a tax for a short or long period of time in order to have a business base their operation, expand, invest capital, etc.

If you take a micro view of it, the city should be getting $8m but will only get $1.6m. Except it brings 1000 new jobs to the area, 1000 jobs who's salaries get reinvested back into the community when the workers buy things, pay taxes, etc. It lowers unemployment not just with those 1000 jobs, but also for businesses that support the warehouse.

There are additional costs associated with it, such as increased road maintenance to support 1000 new cars, thousands of of trucks, increased police and fire departments, etc. It's a balancing act to balance out what the positive economic impact to the area vs what it costs for that impact.

Re:Public money (1)

nedlohs (1335013) | more than 2 years ago | (#40063727)

It's more along the lines of the city would be getting $0 since amazon would likely locate in some other city. This way the city gets $1.6m and some jobs.

And the costs you mention that go with them, but nobody thinks two steps ahead...

Of course some other city loses out on $8m...

Eliminate Sales Tax? (1)

runeghost (2509522) | more than 2 years ago | (#40063153)

Sounds like an excellent time for California to rewrite or eliminate it's state laws on sales tax.

u mad bro? (0)

Anonymous Coward | more than 2 years ago | (#40063187)

'The tax is supposed to be supporting government,' said Lenny Goldberg, executive director of the California Tax Reform Assn., of the proposed sales-tax rebate. 'Instead, it's going back into Amazon's pocket.' Sen. Mark DeSaulnier added: 'It seems like the private sector finds a way to pit one city against the other. You can't give away sales tax in this manner.'

Yeah, they mad.

Instead of complaining about. . . (0)

Anonymous Coward | more than 2 years ago | (#40063189)

Instead of complaining about how this is evil corruption, why not abolish the ecommerce sales tax scheme all together? None of this would have happened if CA never tried to tax ecommerce in the first place.

"supporting the government" (3, Insightful)

roman_mir (125474) | more than 2 years ago | (#40063213)

It seems like this story is trying to make Amazon look bad or trying to make cities that are hunting for Amazon's money look bad, because they are providing the most competitive environment to the other cities and government officials don't like it. It's a story that needs to be cut just like Gordian Knot.

Yes, governments require money.
Yes, private enterprise creates money, so governments require private enterprise.

So governments competing for money of private enterprise makes sense. Some argue that this is wrong, they want 'one government' even 'world government' and 'world taxes', etc., all just to KILL competition (and majority of the mis-educated public believes that government increases competition, not that it destroys it in every way possible).

But of-course the real issue needs to be distilled here just like the Gordian Knot needed to be cut to be solved:

1. Sales taxes and income taxes should not coexist. Income taxes are illegal and collected illegally [slashdot.org] and sales taxes, excise, import taxes are legal and they are the preferred way to run governments, because they can be moderated by the people's purchasing and saving behaviour, and we shouldn't believe in propaganda that we exist to support the government structure and that individual rights are secondary to collective.

2. Governments SHOULD HAVE TO COMPETE for money. Governments that compete for money are governments that are much less spending happy and are aware that their financial situation wholly depends on the financial situation of the actual market and not on their ability to ENSLAVE people through taxing their labour, DESTROY competition by creating, supporting and bailing out monopolies/oligopolies and STEAL liberties and freedoms from people through growth of government offices due to all of the laws and regulations governments come up with.

People must be free to choose between different governments and governments must be local, not global.

Global government above you is a single point slave owner that you cannot escape.

Re:"supporting the government" (2, Insightful)

KozmoStevnNaut (630146) | more than 2 years ago | (#40063323)

So what you're really saying is that you refuse to contribute financially to the society which helped you achieve your current station in life.

I'm assuming that you live a relatively comfortable, perhaps even wealthy lifestyle. Yet you refuse to pay taxes and contribute, like the scum-sucking libertarian festering leech-like boil on society that you are.

Got it.

Re:"supporting the government" (1, Flamebait)

roman_mir (125474) | more than 2 years ago | (#40063341)

So somehow you have taken my comment on what is the correct solution to the problem and turned it into a treatise about myself specifically without having a single fact in you hands?

Why, that's perfect. It's an excellent display of what a disaster the publicly financed education system has become.

Re:"supporting the government" (2, Insightful)

KozmoStevnNaut (630146) | more than 2 years ago | (#40063397)

The fact that you call it "the correct solution" is very telling. As if it is the only single way to run a country, but I'm afraid the tendency to grossly over-simplify things is a common trait in all libertarians I have encountered.

And please do not hold me up as an example of the failures of your US publicly financed education system. Your education system has failed due to religious pressure, infighting and almost complete lack of funding.

None of this has affected my education, I live and was educated on the other side of the Atlantic, first in a public school, then a private school. My further education took place in my country's world-leading publicly financed system of higher educated, which is free and open for all to attend, with no regard to social class or income bracket. THAT is freedom.

Re:"supporting the government" (3, Insightful)

roman_mir (125474) | more than 2 years ago | (#40063501)

The fact that you call it "the correct solution" is very telling.

- says the guy, whose main objection to all of my actual prescriptions was: you are a 'libertarian sob' or some such.

As if it is the only single way to run a country,

- it's the best way to run a successful country, like the USA was 1870-1913. But surely, countries can be run for some time without being economically viable at all, USSR, Greece, USA post 1971 especially, Japan for the last 20 years, etc.etc.

You can run a country and then you can run a country into the ground.

but I'm afraid the tendency to grossly over-simplify things is a common trait in all libertarians I have encountered.

- seriously? The simplest things like: not running over your budget, spending within your limits, not growing the government above its basic and authorised functions and not growing government spending and in fact cutting government spending when there is no money for government, because the government has already done enough to hurt the economy, so the economy is shrinking. Those are not just simple ideas. Those are ideas that nobody wants to follow because they don't want to face the music, yet they love talking about the proverbial kids.

Simple ideas that nobody follows because sticking your head into the sand is even simpler.

And please do not hold me up as an example of the failures of your US publicly financed education system.

- first, it's not my publicly financed education system.

Neither is USA my system, nor does it have to be US system to be a publicly financed failure. Wherever you were 'educated' today, it's most likely you were 'educated' by a publicly financed, publicly ran system, and your failure to understand that point, that it doesn't matter whether it is a USA system or any other nation's, is just another testament to how pathetic this idea is in the first place.

  Your inability to stop talking about any specific circumstance, my or your own ('your father', etc., who asked you? Who gives a shit and what does it have to do with the point that is being made? nothing), proves how completely irrelevant the education systems have become. Worse than irrelevant.

I am sure you weren't actually BORN this stupid - they had to beat this into your head over time.

Re:"supporting the government" (0)

asylumx (881307) | more than 2 years ago | (#40063573)

Gee, you're winning people over to your side in droves with talk like that. It's a wonder the libertarian party hasn't done better lately with people like you!

</sarcasm>

Re:"supporting the government" (1, Troll)

roman_mir (125474) | more than 2 years ago | (#40063603)

Another display of the pathetic state of the public education system - sentiments are above logic, yes?

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063577)

Thanks for not using sockpuppets to mod yourself up this time.

Re:"supporting the government" (2)

forand (530402) | more than 2 years ago | (#40063615)

You are suggesting that the USA was a shining example of how you want a country to be run between 1870 and 1913? A period of time in which the USA saw some of the most egregious examples of centralization of wealth within a very small population? A period of time characterized by robber barons [wikipedia.org] and poor working conditions? When the USA was largely rural and practicing unsustainable farming? What exactly are we supposed to think is the shining example of how an country should be run?

Re:"supporting the government" (3, Interesting)

roman_mir (125474) | more than 2 years ago | (#40063759)

centralization of wealth within a very small population

- only in your mis-educated mind was the time in history that produced the most competition among all sorts of businesses, created all sorts of new products that never existed before and created entire new concepts of distribution of these products and services, was the time that somehow worsened the actual conditions of the general population.

The time that provided maximum freedom to people to run their businesses and to make money not by buying political system or just running the political system directly (dictatorships, monarchies), but instead the time that allowed people to do business unhindered by the dictatorships, monarchies and other forms of totalitarian regimes.

Obviously there were people who became much wealthier than other individuals, but the society increased its wealth production and distribution by a factor that was never observed at any previous time in history. Just the growth of population itself is the testament of the total success of the free market that people in USA enjoyed.

Every monarchy, dictatorship, socialist regime can just look in awe and wonder: how come it was not them that created the most prosperous and industrious nation in a very short time period, but it was a scarcely populated afterthought of a country. Well, today USA is not that USA.

The mis-education that you are getting in your publicly financed propaganda centres gives you a version of history in which actual captains of industry, people who STARTED entire industries are now known as the 'robber barons'.

As to working conditions - without the captains of industry the working conditions would have stayed exactly the way they were before, precisely as they always were. Kids always worked, people always lost limbs and lives at work, it was industrialisation, free market capitalism that forced search for efficiencies due to competition that created new tools and had to create more and more safe environments, because special skills are not acquired overnight and workers with special skills are much more valuable than workers without any special skills, generic workers are only worth as much as their health and individual physical abilities.

Specialised workers take years to train and are not as easily replaced, so their tools are more complex and their conditions must be made safer, because there is always competition who also COMPETES FOR LABOUR.

That's right - workers sell labour, they are not forced into it. And they can sell to highest bidders, whether this concerns monetary compensation or working conditions, and governments can do nothing to improve any of it, they can only watch as the private sector create new tools and systems and require more education and training.

But once the gov't destroys the private sector, none of the tools can or will be manned, education is no longer important.

Tools won't even be present, they are capital, and capital leaves when forced to by the ever hungry, ever growing monster of a government.

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063843)

"... was the time in history that produced the most competition among all sorts of businesses, created all sorts of new products that never existed before and created entire new concepts of distribution of these products and services, ..."

That sounds... rather downright progressive. If progressive means you are for progress.

Sadly, with NewSpeak nowadays...

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063705)

It's pretty rich calling others stupid when your stupidity is displayed for all to see. Your earlier assertion that 'income tax is illegal' is laughable; do you not understand the very simple concept that the US law is decided ultimately by the supreme court's willingness to uphold or overturn a law? So by definition, income tax *is* legal at the present time.
You talk as if your personal interpretation of the US constitution is in some way relevant. If you weren't a deluded libertard you'd say 'I believe that income tax *should be* illegal according to my own (effectively worthless) interpretation of the constitution'.

Re:"supporting the government" (3, Insightful)

KozmoStevnNaut (630146) | more than 2 years ago | (#40063875)

The best way to run a successful country? That obviously depends on how you define "successful".

Can we agree that a successful country is one where each person has the best possibilities to break their social heritage? One where each person has the best possibilities to rise up and create their own wealth? One where education is equally accessible by all and not a road to financial ruin for the unlucky? One where equality between all people, no matter sex, religion or sexual orientation etc. is a priority? One where even the poorest people can live a decent, well-fed existence?

If we can agree on this, and I believe we can, you really should study the Nordic Model, or "capitalism with a human face" as it's also called. Sure, I would love for my country to move further left. It works well right now, notwithstanding the idiotic policies of the previous 10 years of populistic, lowest-common-denominator right-wing politics that sought to dismantle our world-leading welfare model.

Please, do tell me what is wrong with my education? I work for an industry-leading company, among the top people in my country within my field of expertise and I am paid handsomely. I comfortably within the top tax bracket and pay my taxes with pride in exchange for the society that helped me get to where I am today.

Is it because nothing publicly funded can ever be effective, good or admirable, in your mind? You deride the idea of public education as "pathetic", yet you present no arguments.

I never mentioned my father, but now that you did, he also attended the same public education system that I later enjoyed the benefits of. Today, he is a successful business owner and has been for over 20 years.

I'm sorry, but I completely fail to see your points, both in the discussion to this article and in the post of your own writing that you linked to as "documentation" for your wild theories on the subject of income tax being illegal.

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063555)

Guess that makes you a libertarian then. Unless you're hiding the part of your posts that aren't gross oversimplifications of the posts you're replying to. Maybe the reasonable simplifications are hidden behind the outright fiction you're writing and claiming it to be the assertions of the GP..

Re:"supporting the government" (2)

operagost (62405) | more than 2 years ago | (#40063831)

We spent $1.15 trillion dollars on education in the USA last year. Source: US Dept. of Ed.

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063649)

So what you're really saying is that you refuse to contribute financially to the society which helped you achieve your current station in life.

I'm assuming that you live a relatively comfortable, perhaps even wealthy lifestyle. Yet you refuse to pay taxes and contribute, like the scum-sucking libertarian festering leech-like boil on society that you are.

Got it.

Sooo, how much EXTRA do you send in with your tax returns?

Yeah.

Figured that.

Re:"supporting the government" (1)

dkleinsc (563838) | more than 2 years ago | (#40063671)

My solution to this problem: Let GP pay no taxes, but have no access to anything the government has built, or any businesses where government regulation has had demonstrably beneficial effects.

In other words, he gets a homestead in the middle of nowhere with no electric grid, no bank account, no credit card, no car (not that he could drive it anywhere anyways), no Internet access, and (for the sake of argument) put him right next to the Mexican border where the drug cartels like to hang out with semiautomatic rifles, but without any kind of border patrol. Hope he has a good time!

Re:"supporting the government" (0)

Anonymous Coward | more than 2 years ago | (#40063695)

The weirdest part? GP, Roman Mironenko is an upper middle class Canadian, (via reading his resume). Just some 'lead' software developer, who himself seems to have spent the last decade working as a consultant for the heavily government subsidized incumbent telco Bell Canada. Not sure why someone living in our socialist society, who went to a government subsidized university (UToronto) to learn his trade, would be quite such a libertarian scumbag as Roman.

http://russkey.mozdev.org/RomanMironenkoResume.pdf

Re:"supporting the government" (1)

operagost (62405) | more than 2 years ago | (#40063857)

So what you're saying is that you'd rather use a straw man and ad homs than formulate a rebuttal.

Got it.

Or, Senator Dumbass (0)

Anonymous Coward | more than 2 years ago | (#40063219)

Since CA has state income tax, think of how much money it will reap by those taxes on the workers working at the facilities. Plus all the other tax money from the increase in revenue the salaries those people will be spending in the areas....

Brown should reduce CA local aid to these cities (-1)

Anonymous Coward | more than 2 years ago | (#40063221)

by the amount that they give back to Amazon.

Well Senator (1)

Anarchduke (1551707) | more than 2 years ago | (#40063247)

Apparently, you can give away sales tax in that manner.

Can somebody explain why? (1)

Shavano (2541114) | more than 2 years ago | (#40063299)

Two cities get to decide what to do with state sales tax?

This kind of deal just shouldn't be legal.

Re:Can somebody explain why? (2)

a90Tj2P7 (1533853) | more than 2 years ago | (#40063365)

No. Even the summary explains this:

all the sales tax earmarked for local government operations will go to those two cities

They're giving Amazon the money that would go to the city. Not all of the state's tax.

And it will. (1)

Rostin (691447) | more than 2 years ago | (#40063315)

'The tax is supposed to be supporting government,' said Lenny Goldberg, who, despite being executive director of the California Tax Reform Assn., sucks at economics and would rather be "right" than increase the tax base of either of these communities.

FTFY. However, in defense of his position if not his actual reasoning, it is shitty that these cities are offering Amazon a deal when presumably they haven't offered local brick-and-mortar businesses the same. No doubt in a few years when Amazon is perceived to have monopolized some business (the "selling everything for a reasonable price while providing good customer service business," perhaps), everyone will blame the evil free market.

Re:And it will. (1)

BenJeremy (181303) | more than 2 years ago | (#40063417)

Lenny Goldberg is upset that the laws he's worked so hard to enact (funny how a "tax reform" organization wants MORE taxes imposed, too) are being "perverted" by the cities' sweetheart deals with Amazon. He's using an argument he doesn't actually believe in.... because his "side" has no problems opposing this deal, but conservatives need a different argument than "they are ruining our internet tax bill!!!"

The tax deals are nothing new. I live in the Flint, Michigan area, and that sort of thing is still done in this state to attract business.

The states need to form a union (2, Insightful)

Anonymous Coward | more than 2 years ago | (#40063317)

Corporations play one state or city against another to extract tax breaks. They threaten to move the plant here or there, and get different localities to bid against each other with tax reductions. The burden falls on the rest of us.

I have a proposal for how to solve this problem. I think the states should increase their bargaining power against companies by forming a union. We could call it the "United States of America."

Here's how it would work. All the states would agree to be bound by a rule that when a company considers locating a facility in more than one place, none of those jurisdictions can offer it a tax break without the consent of all the others. Any jurisdiction that believes a company is considering another location could make a complaint under this requirement. If the company then chose a different location, and got a tax break there, it would be fined twice the amount of the tax break and the fine would go to the jurisdiction that made the complaint.

Of course, the states already have a so-called union. Too bad it sold out to the companies.

rms, http://stallman.org/articles/states-union.html

We own Amazon (1)

halfkoreanamerican (2566687) | more than 2 years ago | (#40063363)

Apparently we now own part of Amazon. I expect we will get to have a say in how they run their business. I have a co-worker who recently went to the polls and voted for everyone that was NOT in office. I think California should do the same. If you're going to tax, tax. Don't make us wish we didn't even have government.

California "Tax Reform" Association? Really? (0)

BenJeremy (181303) | more than 2 years ago | (#40063383)

OK, so this California Tax Reform Association seems to be set up by a Democrat (warning bells here) who seems to be solely focused on Internet Sales Tax and enforcement of that tax.

In the interest of full disclosure, the summary should mention this fact, as well as the political affiliation of the Senator who is complaining (yes, he too is a Democrat)

Opinions one way or the other of this move to grab a sliver of Amazon's tax revenues notwithstanding, the inclusion of quotes from a decidedly rabid pair of opponents is far from an even-handed treatment of the story.

Re:California "Tax Reform" Association? Really? (1)

dkleinsc (563838) | more than 2 years ago | (#40063737)

Caring about party identification more than what they're actually saying is a sure sign of partisan hackery.

Bribery (1)

Arancaytar (966377) | more than 2 years ago | (#40063449)

Leaving aside the question of how morally wrong this is (very), isn't it completely illegal?

Re:Bribery (1)

gl4ss (559668) | more than 2 years ago | (#40063569)

it's not illegal for a city to bribe a company, apparently. I guess it depends on who has the initiative.

nothing new (4, Informative)

Charliemopps (1157495) | more than 2 years ago | (#40063515)

They report on this like it was a new thing, just invented for amazon. It's not. Whenever a large employer has plans to move into a region they negotiate with several potential local governments to find themselves the best deal. In some cases one city might have an advantage like a rail line or a port, and can offer less of a deal, while another may have negatives... poor roads, bad zoning, etc... and they need to offer a lot more.

My father was VP of a company for years and they set up several factories. The local governments would give them free water, electricity, sewage, etc... You may think that's just a give-away by the city, but what the city would get in return is 1000-2000 employees all paying income taxes... Those same employees would then spend the money they earned, usually in town, and generate sales taxes. The money they spent would bring in other smaller businesses that wouldn't get the same breaks as the larger employer. By far the city profited more from the deal than they lost. That was the point of the deal.

Re:nothing new (3, Insightful)

Hatta (162192) | more than 2 years ago | (#40063761)

In the absence of such a deal, the company would still have to make a factory somewhere. That means those jobs would still exist, and still contribute taxes to the economy. The sweetheart deals only ensure that it's your city that gets the jobs.

So what we have here isn't a situation where everyone's a winner. These deals make your locality a winner at the expense of others. When looked at it from the perspective of society as a whole, these deals are zero sum or worse. They should not be allowed.

And now the truth comes out. (1)

JustAnotherIdiot (1980292) | more than 2 years ago | (#40063525)

Now we know why Amazon has been pushing so hard for taxes, because it gets a slice.
Hey Amazon? You're not the only online retailer. Start pulling this and I'll just stop using your service.

mod 3own (-1)

Anonymous Coward | more than 2 years ago | (#40063607)

"You can't give away sales tax in this manner." (1)

Cornwallis (1188489) | more than 2 years ago | (#40063655)

Well, clearly you can.

competition is good (2)

a2wflc (705508) | more than 2 years ago | (#40063659)

Cities, states, and countries are constantly competing to be the government to vouch for a business entity's credentials (i.e. incorporation services) or to provide other government services for a business (e.g. water, sewage, roads, police, courts to settle disputes).

For these services, sometimes the government wants direct taxes. Other times they are primarily concerned with jobs. These jobs provide residents with money to pay other types taxes (individual income, sales, gas, property, etc) as well as helping other businesses (e.g. restaurants, stores) and decreasing the need for public services (i.e. food stamps).

Sometimes there is corruption in the process. More often than not, the government has decided that having the business is an overall benefit. The government may be incompetent and make a poor decision that doesn't necessarily mean corruption is involved. In any case, you need to look at the total effect (direct + indirect taxes + services that increase + services that decrease) to see if it was a good deal.

It's not ALL the taxes... (1)

billybob_jcv (967047) | more than 2 years ago | (#40063713)

"Sales to Amazon customers throughout California will be deemed to take place there, so all the sales tax earmarked for local government operations will go to those two cities."

In California, there is often a local city or county percentage added to the state sales tax. The cities can do whatever they want with *their* portion of the sales tax. The state's portion goes to the state.

FUHHHHREEEEE MAARRRKEEEEETTT!!! (-1)

Alex Belits (437) | more than 2 years ago | (#40063767)

Now sales taxes go to expand Amazon's profit margins, thanks to free competition between cities!
Something is seriously backward in this picture (and should've never been legal to begin with).

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