Apple slips billions through loopholes of U.S. tax laws
By DAVID HORSEY | 5:00AM - Wednesday, May 23, 2013
APPLE, America’s richest, most innovative consumer technology company, is also the most creative in hiding billions of dollars in profits from the taxman, according to congressional investigators. But on Tuesday in testimony before the Senate Permanent Subcommittee on Investigations, Apple CEO Tim Cook pointed out that his company’s creative tax sheltering, far from being illegal, is made possible by the loophole-ridden tax laws of the United States.
Cook told the senators that Apple paid a $6-billion tax bill to the federal government last year. Not only does Apple pay everything owed to the IRS, Cook said, the company does not employ gimmicks to avoid required tax payments.
The subcommittee chairman, Senator Carl Levin (Democrat-Michigan), differed with that last point. "The company's engineers and designers have a well-earned reputation for creativity,” Levin said. “What may not be so well-known is that Apple also has a highly developed tax avoidance system — a system through which it has amassed more than $100 billion in offshore cash in a tax haven."
According to congressional investigators, Apple has developed an overseas network of obscure subsidiaries that are run by executives in Apple’s Cupertino headquarters, often with no employees in the locations where they are technically based. For the most part, the subsidiaries do not exist for any other reason than to have huge chunks of corporate earnings assigned to them on paper, thus making it possible for Apple to keep that money outside the reach of the IRS. One Irish subsidiary has paid almost zero tax on $30 billion in profits since 2009, according to investigators.
Before the hearing, Senator John McCain (Republican-Arizona) said, “Apple claims to be the largest corporate taxpayer, but by sheer size and scale, it is also among America’s largest tax avoiders.” When he was face to face with Cook, he said Apple had violated the spirit, if not the letter, of the law.
McCain’s fellow Republican Senator Rand Paul of Kentucky took exception to the bullying tone of his colleagues. "What we're talking about is what every company in America does, and that's minimizing their tax," Paul said. He asserted that the real culprit was “the awful tax code” and that “Congress should be on trial” for failing to fix it.
Stated more gently, that was Cook’s ultimate point as well. He called for a lowering of the corporate tax rate and a simplification of the law. Such changes would likely mean Apple would end up paying more in taxes, Cook told the senators.
Cook may have a good idea, but it is preposterous to think the current dyspeptic Congress will get past its dysfunction and find common ground on the best way to reform the tax code. Too much ideology and too many lobbyists stand in the way. As a result, Apple and every other American corporation will continue to slip through the gaps in the outmoded law with big bags of cash bound for foreign lands.
No doubt there'll be plenty of gullible suckers silly enough to hand over money for these things....
Hi! No one cares about your headphone jack
By Mark Morford, SF Gate Columnist | 7:59AM PDT - Thursday, September 08, 2016
Oh no another minor change in how we use a very popular piece of technology! What's wrong with the world? Change! Exceedingly minor! Don’t freak out, K?
YOU do not have any problems. You do not have a thing to worry about in your life, not really, especially not if you spent more than eight seconds this past month sighing out some snarky, pinched-mouth, head-shaking disapproval of Apple's long rumored and world-shattering (except not really) decision to eliminate the antiquated, horrible-sounding mini headphone jack from the new iPhone 7, and replace it with, well, nothing at all.
Yes, the mini jack is gone. In its place, just Bluetooth. Or an adapter that lets you use your old headphones via the Lightning port. OMG what a hassle! What is Apple thinking? What greedy, profiteering monsters they must be! Except not really.
Did you know this is what Apple (and every other self-respecting modern company in the world who wants to survive more than a year) has done for decades? Obsoleted various technologies at their own option and daring, because it was time, their designers and engineers saw a better way, the old tech was too slow or too ungainly or too unnecessary and you gotta change or die?
The CD-ROM drive, the floppy drive, the beige PC, the 64-pin connector, flip-phones, Walkmans the size of your head, Microsoft, and many, many more — all made blessedly obsolete by Apple and, despite wails of resistance and how-dare-theys and the vacant threats of boycotts or people running back to old versions, no one misses any of them in the slightest. Not to mention the million or so functions Apple has eliminated/replaced over the years in the Mac OS itself, functions which everyone swore they could never live without but then suddenly did, because who cares.
Here's a fun mind game: Do you know what the iPhone would look like today if average consumers like you or me had our say about what to change and what not to change, as the product evolved?
Go ahead, pretend you're going to miss it. You won't.
That's right: Nada. Empty space. The thing wouldn't exist at all, because consumers are generally dumb and would never have imagined such a device in the first place, because everyone thought creaky flip-phones and miniscule gray LED screens and lumpish Blackberries were infallible hunks of genius when in fact they were clunky gallstones of prehistory.
Here's another, even more terrifying mind game: Try to imagine a modern consumer world without Apple in it, one largely “designed” by Microsoft and HP, GE and Nokia and, I don't know, Ford. Then smack yourself in the head with a brick, in unfettered gratitude for what Jobs hath wrought. Apple singlehandedly improved and beautified the functionality and design of the modern world, from staplers to sex toys, TVs to cars, home design to product packaging.
Do not misunderstand. Apple is far from perfect. Their famously easy-to-understand operating systems and quick-setup user interfaces are nearly long gone. iTunes, for one, is a nightmare hell-beast of inelegant, poorly designed bloat. The products are still uniformly gorgeous, but running them smoothly and linking them all together is increasingly insane.
But it's not really Apple's fault. Complexity of function and capability have increased exponentially, to ridiculous degrees. We are, after all, a whiny and demanding bunch. We expect our phones to circle the goddamn moon just to tell us what to have for dinner. And lo, they do. Things are a little confusing in the OS now? Oh, hush.
Steve Jobs famously hated focus groups. He believed, rightly, that you can't really innovate by listening to clumps of unimaginative yokels tell you what they think they want. They will only want the same thing they already have, only faster and cheaper and hey, can you make one in blue?
Another thing AirPods have made obsolete? Jawbones and other obnoxious Bluetooth earpieces. (You can use one by itself, and use it for calls and Siri, as well as music.)
To truly innovate, you hire genius designers and visionaries and trust raw instinct, throw out the old ways and take a major risk or ten, and see what happens. Doesn't always work. In Apple's case, it usually does.
Do not listen to these people. Do not be one of these people. You have to take 37 seconds to figure out how to use new Bluetooth headphones in your new iPhone? You have to keep track of yet another adapter? You must ponder potential brain damage from all the electromagnetics hammering your cortex all the time every single day forever? Whatever. Repeat: You have no real problems.
I remember the banshee-like screams of protest when Apple eliminated the CD/DVD (optical) drive from their Mac lineup sometime back in 1937 (or whatever it was). “Now how am I going to watch scratchy DVDs or burn in all my old Dave Matthews CDs?” millions of humans did not shriek, before being slapped by fate, smacked by capitalism, and gently mocked by time. “Oh right. This is not a real problem. Also, I have terrible taste in music. What's on iTunes?”