Tim Cook "Not Religious" About Holding Cash; 66% of Apple's $81B in Cash is Held Overseas

[divinox]

If a company decides to sit on cash there is usually a reason. It may feel that it needs it due to future economic issues or may want to buy another company or use it for R&D. Savings is beneficial to a society. Not all money should be spent immediately, it makes no sense. That is the problem with our economy is that the gov. has been pushing immediate consumption when we need more savings.

Companies should not get any money from the government. But the government should only tax individuals. It makes no sense to tax corporations. This is a regressive tax that usually paid by the lower income individuals that either consume the corporate goods or the workers of the corporation.

Corporations benefit from public investments. In fact, Public investments oft-times generate, and/or strengthen, possibilities for emergence of corporations. Ergo, by applying a "those who benefit should contribute"-rationale it definitely makes sense to tax corporations (and citizens).

As an example, car manufacturers, gas stations, oil companies, industries, work-places etc. all benefit massively from road infrastructure. Thus, it makes sense that they help build said infrastructure*.

* Granted, one could argue that infrastructure could, and even should, be provided through private means - but that would not render taxes null, it would just shift the revenue stream from B2G to B2B.

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So they get a free ride? I have to pay to educate their work force, to pave the roads they use to distribute, the fire stations and police and even the army that protect them, AND THEY GIVE NOTHING BACK TO THE COUNTRY THAT ALLOWS THEM TO PROFIT???

Are you CRAZY?
Oh, wait, you have to be a Randian.
Then yes, yes you are.

exactly.

p.s. Randians are scary creatures.

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yes and under capitalism that reason i usually greed.. which is instinctive in humans BUT they should not be allowed to do that to the point that it becomes destructive the economy.. in effect they are obtaining capital then denying the population from being able to benefit because the tax revenue is not be obtained.. but i know the govt now works for these companies so 99% of what they do is to me the companies and govt members richer .. general population can go to her or live as slave that is pure capitalism.

On this, i'd say the issue is just as much, if not more, lack of circulation as lack of taxation. After all, were talking about 80bn that, if paid out to share-holders as dividends, could be re-invested, and re-inserted into the economic system.

Yes, those commenting on the upsides of savings, and the down-sides of overconsumption certainly have a point. But theres a difference between saving for the future and stuffing your mattress with cash.

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Why is capitalism (free markets) considered greedy and selfish? Let me rephrase the question: Why are mutually beneficent transactions considered greedy and selfish?

They're considered greedy and selfish by those who 1) weren't party to the transactions, but 2) want one or both of the things that were exchanged in them. On one level, this can simply be a ploy by the latter people to get stuff without having to earn it.

I'd say that large part of it is a) the parasitic tendencies of taking, but not giving, and b) lack of responsibility when it comes to externalities, and incurring costs for the society at large.

Im not sure if greed is the best placeholder for such behavior, but it surely isn't far off the mark - and undoubtedly holds relevance, jealousy aside.

 

[mcmlxix]

Apple is part of the reason I can't find a job after graduating college in May. I studied performing arts with a 3.5 GPA!!

How many of you graduated with that high GPA?

Performing arts?

All of these people who majored in English lit, women’s studies, art, etc are now demanding good jobs. Plug in. GPA or not, you should have went to school for technology, engineering, medicine, etc. if you want employment.

 

[chrmjenkins]

If that money is earned outside the United States, why should they? The products are built somewhere else, sold somewhere else, and money collected somewhere else. All these would already be taxed in countries where these activities are happening. Why should they bring the money into the states to face another round of taxes? That's double taxation.

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This isn't just about Apple, this is competition between countries. Because the USA has such high tax rates; it's only natural that companies try to go to places where taxes are lower. The reason things are looking bad is because America is no longer competitive. Taxes are high, utility costs are high, transport costs are high, labor costs are high, too many laws and regulations and too many unions who want to be paid high but don't want to do equivalent work. With these conditions, which sane businessman would like to setup shop in the states? Won't it be natural to just move somewhere more attractive if you have a choice?

1) This is not unique to the US.
2) US tax rates are so fraught with loopholes, many companies pay close to no tax. For instance, google paid less than 2% last year. GE essentially paid nothing.

 

[GorgonPhone]

Why is capitalism (free markets) considered greedy and selfish?

cause the markets are not "free".. FACT they are politically strategically manipulated by many people in order to make the rich richer outside of the natural expected ebb and flow of a free system..

Thats what many citizens fail to realize when they are being sold the "capitalism is great" religion.. capitalism is great for the rich and very destructive to all others..

capitalism has a life cycle and as it reaches the end or critical mass it causes what we are seeing now in these and the world economy..

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You can't dodge the money you owe. Oh wait yes you can because you are a big business. Now if I tried to dodge my taxes all hell would break loose.

exactly cause your tax money payed is funneled into the pockets of big corporations through corrupt govt members and tactics.. can you say "bail outs"???????

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Have you not realized that these loopholes were created with campaign contributions and PACs with lobbyists heavily influencing our politicians?
What rational person would allow these loopholes in the first place?
Money can and does buy influence.
Corporate money has been a big reason why we are in the mess we are in now.
Many of our laws and policies should be for the people not the corporations.
Get money out of politics and stop the corruption.

exactly.. the corrupt politicians create loops holes for their business buddies to slip through..

 

[darryljones]

Yes, those commenting on the upsides of savings, and the down-sides of overconsumption certainly have a point. But theres a difference between saving for the future and stuffing your mattress with cash. .

Stuffing your mattress with cash is saving for the future. I hope it is not too use it solely for sleeping. The main point is that it is your property you can do what you want with it. If I want to take all my money out of the bank and make paper airplanes out it I should be able to and you or the government have no right to say I should not.

I'd say that large part of it is a) the parasitic tendencies of taking, but not giving, and b) lack of responsibility when it comes to externalities, and incurring costs for the society at large.

Im not sure if greed is the best placeholder for such behavior, but it surely isn't far off the mark - and undoubtedly holds relevance, jealousy aside.

What and who is giving?? I hope you are not talking about taxes. Taxes is not giving first of all. Taxes are forced confiscation under penalty by law this is very different from "giving" which is voluntary.

I fail to see Apple Company as "incurring costs for the society at large" quite the contrary. Their innovation has done a lot. The people that run and are employed by Apple do pay taxes for roads and such. I am suggesting that the taxation be done on the individual level not the corporate level.

Are you saying that we all should pay an extra $25 each Iphone so that Apple can give back? Are you saying that they should not use the savings for future manufacturing plants so they can give back? Are you saying that they should cut the workers pay to give back? What about innovation investments should those be cut to give back? Maybe we could get a new phone every 2 years so they can give back some? Does that help?

I would venture to say that the money is better used by letting apple find its best use... than this ignorant "give back" or confiscation to the wasteful US federal gov.

 

[GorgonPhone]

What?
Who controls the government?
It's the people that are in political positions.
Maybe I was not clear in defining "Politicians" but that includes both elected and appointed individuals that are in power to make, change and set regulations.

99% of them have big affiliations with big corporations.. they are humans they want money and as much of it as they can get fro themselves and their families and they get it at the expense of the population as a whole..

 

[henchman]

So, if the money is earned outside of the US, then keep it there.
The only reason they want to bring it in tax free is so hey can use it wholly to enrich themselves. Why else do they want to bring it in?

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I would venture to say that the money is better used by letting apple find its best use... than this ignorant "give back" or confiscation to the wasteful US federal gov.

Appes best use is to thenselves.
Proof in the fact they have no outright charitable contributions.

 

[GorgonPhone]

Apple is part of the reason I can't find a job after graduating college in May. I studied performing arts with a 3.5 GPA!!

How many of you graduated with that high GPA?

lol i got a .. 3.7 GPA with honors BFA in visual communication.. i work on advertising and marketing.. its hard finding jobs but can still be picky about what ij take though is its not that bad yet..lol

 

[darryljones]

cause the markets are not "free".. FACT they are politically strategically manipulated by many people in order to make the rich richer outside of the natural expected ebb and flow of a free system....

Completely agree! We do not live in a free market it is manupulated. But this is not Capitalism it is defined as Corportism. This not a free market. Free markets is the proper term and it is benificial to all rich or poor. Corportism (usa) unfairly benifits the rich and corporations.

You are right that free markets eventually turn into Corporatism (not free). Which is what we have now.

This is why if we limit the government from being able to "regulate" meddle in the specific commerce and not the general commerce as originally stated in the constitution, the markets would be more free and benefit individuals the most.

 

[Bluestrike2]

It's bad for the global economy for here to be money stashes this large. Money is valuable when it's in circulation, not when it's sitting. Apple has made all this money from us. Maybe it's time for them to give back in some really big ways. $81 billion? How about committing even a fourth of that to creating green energy infrastructure, or desert reclamation projects or any number of other things that the world needs. Hey Apple, time to step up.

Even if it was 100% cash sitting in an account somewhere, it's still being lent out by the bank in a fractional reserve banking system. Money never sits.

 

[Ugg]

Performing arts?

All of these people who majored in English lit, women’s studies, art, etc are now demanding good jobs. Plug in. GPA or not, you should have went to school for technology, engineering, medicine, etc. if you want employment.

So what about overpaid and parasitic sports players?

Are we supposed to simply sit at home and twiddle are thumbs in the evening?

 

[GorgonPhone]

Completely agree! We do not live in a free market it is manupulated. But this is not Capitalism it is defined as Corportism. This not a free market. Free markets is the proper term and it is benificial to all rich or poor. Corportism (usa) unfairly benifits the rich and corporations.

You are right that free markets eventually turn into Corporatism (not free). Which is what we have now.

This is why if we limit the government from being able to "regulate" meddle in the specific commerce and not the general commerce as originally stated in the constitution, the markets would be more free and benefit individuals the most.

true^^^BUT capitalism leads to corporatism its the nature and evolution of the beast

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So what about overpaid and parasitic sports players?

Are we supposed to simply sit at home and twiddle are thumbs in the evening?

they are payed what seem high because the amount of money made by those who employ them and others who are not even doing the work is much much much higher you dont hear about that so you dont know..

 

[ThunderSkunk]

true^^^BUT capitalism leads to corporatism its the nature and evolution of the beast

True, and corporatism is fascism, which so far has always led to totalitarianism.
Lets see if this time it doesn't. ...for a while.

 

[divinox]

Stuffing your mattress with cash is saving for the future. I hope it is not too use it solely for sleeping. The main point is that it is your property you can do what you want with it. If I want to take all my money out of the bank and make paper airplanes out it I should be able to and you or the government have no right to say I should not.

Of course, i just wanted to point out that theres beneficial saving, and wasteful saving (in the grand scheme of things that is economics). And, while you are free to do whatever you want with what you own, you must remember that "what you own" is constituted by a system, which in itself is built on assumptions about how you will use what you own.

Drawn to its extreme, asset use that runs counter to the system that gives asset ownership legitimacy runs the risk of undermining the legitimacy of ownership itself.

What and who is giving?? I hope you are not talking about taxes. Taxes is not giving first of all. Taxes are forced confiscation under penalty by law this is very different from "giving" which is voluntary.

As for what, there are many ways of giving (back). As for who, everyone partaking in society really.

When it comes to what i read as the Randist "tax equals theft" argument, i choose not to comment. Tax is no different than any other regulation (such as prohibiting of murder). Its, simply put, a quality, or characteristic, of the currently upheld system - in fact, the very system that you draw upon in order to illegitimate appropriation of assets (in your terms, confiscation). Theres no neutral order to draw on.

Theft is theft because the system defines it as such. Similarly, taxation is legitimate because the system defines it as such.

I fail to see Apple Company as "incurring costs for the society at large" quite the contrary. Their innovation has done a lot. The people that run and are employed by Apple do pay taxes for roads and such. I am suggesting that the taxation be done on the individual level not the corporate level.

While i didn't have Apple in mind, Apple is definitely not guilt-free when it comes to externalities. That does not mean the net effect can't be positive. It just means that their not carrying the entire weight of the operation, effectively unloading it upon those outside to Apple.

(In short, in making money they are incurring uncompensated costs for others).

Are you saying that we all should pay an extra $25 each Iphone so that Apple can give back?

Im saying that for the free market to truly be free, there can not be any externalities; i.e., all costs incurred by the production of a service or good must be born by those consuming said service or good. In todays market, that is rarely - if ever - the case. Tax is one way to balance the equation out.

Are you saying that they should not use the savings for future manufacturing plants so they can give back? Are you saying that they should cut the workers pay to give back? What about innovation investments should those be cut to give back? Maybe we could get a new phone every 2 years so they can give back some? Does that help?

Not at all what i said, or even implied.

I would venture to say that the money is better used by letting apple find its best use... than this ignorant "give back" or confiscation to the wasteful US federal gov.

See above.

 

[Halex Valgus]

Why pay US taxes?

If AAPL were to suddenly liquidate it's entire market Cap ($370B) and give that to the Federal government it would only cover the current rate of borrowing for 2 1/2 months. Let that sink in. Hell, let's throw in Microsoft, IBM, and Intel ($227B, $212B, and $127B). Let's liquidate all of them as well. Great! Now we've raised enough money so that we don't have to borrow for a whole 6 months. Except when we're done with those six months we're back to borrowing. The same ammount. Except we've gutted 4 of the top tech companies. Yes. Lets continue to pretend that AAPL holding it's hard earned cash offshore is the problem. Let keep insisting that we give the drunk just one more drink. Spending is the problem. The days of circus and bread are over.

 

[divinox]

If AAPL were to suddenly liquidate it's entire market Cap ($370B) and give that to the Federal government it would only cover the current rate of borrowing for 2 1/2 months. Let that sink in. Hell, let's throw in Microsoft, IBM, and Intel ($227B, $212B, and $127B). Let's liquidate all of them as well. Great! Now we've raised enough money so that we don't have to borrow for a whole 6 months. Except when we're done with those six months we're back to borrowing. The same ammount. Except we've gutted 4 of the top tech companies. Yes. Lets continue to pretend that AAPL holding it's hard earned cash offshore is the problem. Let keep insisting that we give the drunk just one more drink. Spending is the problem. The days of circus and bread are over.

Well said.

p.s. Amount would be less, as part of the amount is covering interest. But yeah, Americans (and a few others) need to wake up and smell the coffee. You can only go so long before the snake that is credit bites you in the ass.

 

[GorgonPhone]

True, and corporatism is fascism, which so far has always led to totalitarianism.
Lets see if this time it doesn't. ...for a while.

^^^so true why cant people see that.. its sad we have to go through all this BS

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If AAPL were to suddenly liquidate it's entire market Cap ($370B) and give that to the Federal government it would only cover the current rate of borrowing for 2 1/2 months. Let that sink in. Hell, let's throw in Microsoft, IBM, and Intel ($227B, $212B, and $127B). Let's liquidate all of them as well. Great! Now we've raised enough money so that we don't have to borrow for a whole 6 months. Except when we're done with those six months we're back to borrowing. The same ammount. Except we've gutted 4 of the top tech companies. Yes. Lets continue to pretend that AAPL holding it's hard earned cash offshore is the problem. Let keep insisting that we give the drunk just one more drink. Spending is the problem. The days of circus and bread are over.

the monster is out of its cage so there is no solution.. except massive sudden population reduction to sooth the human redundancy brought on by capitalism quest fro efficiency and profits

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Well said.

p.s. Amount would be less, as part of the amount is covering interest. But yeah, Americans (and a few others) need to wake up and smell the coffee. You can only go so long before the snake that is credit bites you in the ass.

the consumers were taught sometimes forced to use credit cause of inflated prices for things... only 10% of the population can but cars and houses etc with ought credit

 

[ThanksSteve]

It sounds like Cook is open to purchasing new companies or expanding Apple's reach into new business areas as Google has done in a few areas. Let's hope they use most of the cash for upgrades of the already impressive line of products and not to get into too many new areas as that often causes a decline for companies.

Personally, I'd focus on buying companies that ensure iPhone and iPad stay ahead of Android and other competitors. Siri is a good example.

 

[TallManNY]

2) US tax rates are so fraught with loopholes, many companies pay close to no tax. For instance, google paid less than 2% last year. GE essentially paid nothing.

First off this is almost certainly not true. Second, if I were to walk you through these "loopholes" you would realize that a great deal of them aren't really loopholes.

In the case of the GE Tax issue scandal that went around, the confusion was that the initial articles that talked about this confused owing additional taxes at the end of the year and whether you paid taxes at all. I often don't write a check to the IRS on April 15, but that is because I had taxes withheld from my salary throughout the the year. GE pays estimated taxes every quarter as well. They might pay more or get a credit back after they work through the entire year's results. But they almost certainly net paid taxes.

There are lots of incentives in the tax code, but a lot are supposed to spur things like investment in the U.S. For example, one of the largest tax credits in our country is for investment in low income housing. Lots of companies make those investments so they can get the tax credit. But government seems to think that investment in housing that is designated and reserved for lower income families is worth supporting with tax credits.

It is more complicated than you think and just saying "loophole" really isn't fair.

 

[chrmjenkins]

First off this is almost certainly not true. Second, if I were to walk you through these "loopholes" you would realize that a great deal of them aren't really loopholes.

In the case of the GE Tax issue scandal that went around, the confusion was that the initial articles that talked about this confused owing additional taxes at the end of the year and whether you paid taxes at all. I often don't write a check to the IRS on April 15, but that is because I had taxes withheld from my salary throughout the the year. GE pays estimated taxes every quarter as well. They might pay more or get a credit back after they work through the entire year's results. But they almost certainly net paid taxes.

There are lots of incentives in the tax code, but a lot are supposed to spur things like investment in the U.S. For example, one of the largest tax credits in our country is for investment in low income housing. Lots of companies make those investments so they can get the tax credit. But government seems to think that investment in housing that is designated and reserved for lower income families is worth supporting with tax credits.

It is more complicated than you think and just saying "loophole" really isn't fair.

http://www.bloomberg.com/news/2010-...illion-u-s-revenue-lost-to-tax-loopholes.html

You were saying?

 

[Abazigal]

You can call it a loophole or feature or whatever you wish. The point is that large corporations are able to get away with paying minimal tax. Yes, the laws do allow for it, but it is debatable if they are right or justified in doing so or not.

Personally, I feel Apple is just a small player in all these. America really screwed up big time, what with the housing loan crisis and its inability to handle the fallout. I doubt that even if Apple had dutifully paid the taxes it supposedly "owed", America would be able to resolve the crisis. It is like a giant financial sinkhole, and it is just dumping good money inside a bottomless pit!

Majority of you people are just unhappy and bitter, and eager to find a punching bag to point an accusing finger at and vent your frustrations.

 

[brdeveloper]

I bought a camera in Hong Kong and had to pay import taxes at the US custom when I returned home. Why Apple should have a free run? Obama should tax them up to 50% for cash stored outside US, that's how you will convince them to move the money here. Apple ($$$) do not care about patriotism, they have slaves in china to produce the toys for you to enjoy. A lot of people died there regularly for it. It all about profits. Open your eyes, they are just like Exxon or Chase.

Good point. And patriotism is so outdated and republican. If Apple makes a lot of money in China, why not to keep the money there? So Apple can reinvest and make more and more money in that profitable country. Apple stocks will continue increasing and maybe chinese people can buy overvalued Apple stocks in China stock exchanges in form of Chinese Depositary Receipts (CDRs). Some american people will still get a lot of money selling their stocks to chinese investors. This is the dance of money... some goes out, some come back. Everyone has a chance to make money in a globalized fashion.

 

[Frisco]

Lol, I'm graduating with a bachelor's in biomedical engineering, with a 3.6, and even I can't seem to find a job.

biomedical engineering is a thing of the past in the US. I always tell people to be responsible when picking a major!!!

 

[eye]

So what about overpaid and parasitic sports players?

Are we supposed to simply sit at home and twiddle are thumbs in the evening?

They make their teams/leagues billions of dollars. If you were that good at something, you'd get paid buttloads of cash too. They deserve every cent. Most of them have worked harder than every one of us for most of their lives. Believe me, people think you are born good at sports, but it's both being born good and working insanely hard. Right now, we're twiddling our thumbs on this message board and Kobe Bryant is probably doing squats or practicing free throws.

Besides all that, back to the main point - they entertain billions of people and are paid like entertainers of billions of people.

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Lol, I'm graduating with a bachelor's in biomedical engineering, with a 3.6, and even I can't seem to find a job.

Even mentioning your gpa, unfortunately, shows how little you know about how to get hired. Nobody cares about a gpa. Nobody even cares really what college you went to. They care what experience you have, how personable you are in your interview, and who can recommend you. No gpa ever made someone money.

Yes, they make it seem important in school, because that's what they're selling. Theyre not going to let ou know you're being sold a hill of beans.

 

[brdeveloper]

You can call it a loophole or feature or whatever you wish. The point is that large corporations are able to get away with paying minimal tax. Yes, the laws do allow for it, but it is debatable if they are right or justified in doing so or not.

Personally, I feel Apple is just a small player in all these. America really screwed up big time, what with the housing loan crisis and its inability to handle the fallout. I doubt that even if Apple had dutifully paid the taxes it supposedly "owed", America would be able to resolve the crisis. It is like a giant financial sinkhole, and it is just dumping good money inside a bottomless pit!

Majority of you people are just unhappy and bitter, and eager to find a punching bag to point an accusing finger at and vent your frustrations.

I think american education system is the best of the world. The best in the sense that fits better to the capitalist system. Of course France and Germany are strong players in human sciences, however these areas are not so profitable as engineering, computer science or pharmacology.

SO, and this is the point, why should americans would be feared with globalization? Yes, this topic is mainly about "american's fear of globalization". You created this "monster" and, believe, you are the best on handling it. So why are you feared?

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So, if the money is earned outside of the US, then keep it there.
The only reason they want to bring it in tax free is so hey can use it wholly to enrich themselves. Why else do they want to bring it in?

Correct... american patriots should defend taxes. Do you really think that Apple would create more jobs in US if they had their money back "for free"? A few people would buy their next top-grade BMW or have its personal helicopter. If they would think for a moment on creating jobs, they surely would do it where it is cheaper: China, India, Mexico, Brazil and so on.