The debate over corporate ‘inversions’ (the practice of US businesses reincorporating overseas in order to avoid US taxes) has gone mainstream Stateside. Recently, both Jon Stewart (on the Daily Show) and Stephen Colbert have dedicated segments of their shows to inversions. You can see both (funny and insightful) pieces on this page. (If the videos don’t work where you are – apologies, you should be able to find versions that will work for you on Comedy Central’s website or
by Googling using the search engine of your choice.)
Stewart characterizes the inversions as “a win-win for everyone – and by everyone I mean only the corporations and their shareholders.” Congress estimates that inversions will cost the Treasury $19.5 billion over 10 years, but experts (and “communist rag” Fortune Magazine) say this estimate is far too low. What Colbert and Stewart do not mention are the victims of these schemes – tax avoidance in general being very far from a victimless practice. It is everyday people who feel the effects of these missing billions – from the burden of taxes shifted on to their labour and consumption to make up the revenue shortfall, to the declining quality of services and infrastructure funded from public resources. As we have outlined previously, women often take the biggest hits in this regard – and of course, are vastly under-represented among the corporate executives and shareholders who benefit.
A Republican senator shown in the Daily Show clip claims that “in a way, these corporations are economic refugees” from over-high taxes. Political blustering aside, what these inversions really mean is that there is less money to deal with the real refugees who are flooding into the US from Central America – tens of thousands of whom are unaccompanied children, who are being held and processed in woefully inadequate conditions.
[And here is a reminder that inversions aren’t the only way that US corporations avoid taxes.]