Backdoor Bankroll

Another interesting take on the kerfuffle surrounding the defunding of NPR and the CPB comes from an entirely different direction, and from two separate sources. The first, from industry consultant Jim Haigh, challenges the assertion that public media shouldn’t be given a grubstake — when taxpayers at the same time are unknowingly subsidizing much more abusive institutions, some foursquare on the far right:

Now that we’ve attacked the pennies-per-person subsidy of NPR, let’s go after some real coin: taxpayer subsidy of Fox & NBC! When multinational corps dodge taxes, we citizens and small businesses make up the difference. NewsCorp/Fox is dodging in 152 tax havens (p.34) & GE/NBC in 7 with now majority partner Comcast in 3 more tax havens . . . Squawking about a few millions while ignoring mega billions speaks volumes about this debate and the state of media & misinformation. See GAO Report on Off-Shore Tax Dodgers: http://1.usa.gov/hSCH97.

This report lists the 100 largest publicly traded U.S. corporations and their tax havens. Similarly, this post on AlterNet.com, entitled “How You End Up Bankrolling Fox News: News Corp. and Rupert Murdoch Weasel Out of Paying Taxes,” blasts the hypocrisy of those clamoring for the pound of flesh from public media while blithely ignoring the tons tanning in the Caymans:

[I]f the right wants to introduce the issue of federal funding of the media into the public debate, they should be prepared to see their own Fox gored. Fox News has been the beneficiary of government largess for years and it is time stop it and make Fox pay its own way. As far back as 1999, there have been reports documenting how News Corp, Fox’s parent company, exploited loopholes in tax laws that permitted them to avoid levies that all other citizens have to pay. From The Economist:

“…News Corporation and its subsidiaries paid only A$325m ($238m) in corporate taxes worldwide. In the same period, its consolidated pre-tax profits were A$5.4 billion. So News Corporation has paid an effective tax rate of only around 6%. By comparison, Disney, one of the world’s other media empires, paid 31%. Basic corporate-tax rates in Australia, America and Britain, the three main countries in which News Corporation operates, are 36%, 35% and 30% respectively.”

The article goes on to describe how News Corp used a complex network of accounting dodges including as many as 60 shell companies that were incorporated in such tax havens as the Cayman Islands, Bermuda, the Netherlands Antilles and the British Virgin Islands. More recently, an investigation by the New York Times revealed that…

“By taking advantage of a provision in the law that allows expanding companies like Mr. Murdoch’s to defer taxes to future years, the News Corporation paid no federal taxes in two of the last four years, and in the other two it paid only a fraction of what it otherwise would have owed. During that time, Securities and Exchange Commission records show, the News Corporation’s domestic pretax profits topped $9.4 billion.”

When giant, prosperous, multinational corporations weasel out of their tax obligations, ordinary citizens are the ones who are forced to make up the shortfall. That is effectively a tax subsidy for the corporations funded by you and me and all of the indignant Tea Partiers who claim to oppose special interest favors for the elite.

The author, Mark Howard, makes some powerful points herein and on the blog he publishes, News Corpse, “The Internet’s Chronicle of Media Decay” (link now on right).

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