Even for the Formerly Gray Lady,
this is incredible. Two left-wing Senators put out a silly press release complaining that for the past ten years, most corporations in the U.S. have paid no federal taxes. As powerline points out, duh.
As Levin and Dorgan undoubtedly know, most small businesses, and many large ones, don't pay federal income taxes because they don't make any money. Most companies, especially small ones, pay their employees, after which there is nothing left to report as profit. Those salaries, of course, are taxed as ordinary income. If the corporations are Subchapter S, any earnings are passed through to the owner(s) and taxed at that level.
Demonstrating the current standards of journalism, the FGL took the democratic press release at face value and ran with it.
The paper got out its calculator, multiplied the gross revenues of the companies in the GAO study by 35%, and came up with this classic of economic ignorance: At a basic corporate tax rate of 35 percent, all the corporations covered in the study in theory owed $875 billion in federal income taxes.
Astonishingly, neither the Gray Lady's reporter nor any of its editors understand that taxes are on net, rather than gross, income, so the bogus story becomes even more ridiculous. Apparently the Times' policy of
deliberately hiring reporters who are ignorant (see bottom of the post) applies to more than Religion.
