Caterpillar CEO’s Business Strategy: “Bluster While You Plunder”

Class War For Idiots / July 26, 2011

By Anathapindika Bhikkhu

They grow some giant hogs back there in Illinois, but the CEO of Caterpillar, HQ’d in Illinois, represents a whole new subspecies of giant pork-fat-based fauna, a species that has developed the ability to lecture America about the evils of taxing poor multinational corporations like Caterpillar, while simultaneously stuffing embezzled tax money into its pork-fattened coffers.

In late March of this year, the Doug Oberhelman, Chairman and CEO of heavy equipment behemoth Caterpillar Inc, went to town with his “grievances” on the allegedly oppressive business climate in Illinois. It’s a story that’s been widely referenced by Republicans as “proof” that raising taxes kills jobs. In a letter (leaked to the public) to the governor of Illinois, Oberhelman threatened to move Caterpillar out of Illinois. The threat to move out of Illinois received wide publicity through media and financial bloggers and the likely effect was that Caterpillar was seen as a victim.The starting point for this brouhaha was supposedly Illinois temporarily raising its corporate taxes from 4.8% to 7% and temporarily raising personal income taxes from 3% to 5%.

Doug Oberhelman points in the direction of Caterpillar’s offshore illegal tax shelters used to rat-fuck America.

Earlier in January when the Illinois legislature was voting for a tax increase to make up for its deficit, the Caterpillar (CAT) CEO complained in a Chicago Tribune op-ed about the increase in the personal income tax rate –

The personal tax rate at 5.25 percent would mean that more than an additional $40 million would be taken from the paychecks of Caterpillar’s Illinois employees in the first year.This is too much. Such dramatic increases in income taxes will stifle economic growth. The most prudent way to emerge stronger from this budget crisis is to cut state spending rather than only reducing the growth rate of expenditures.

But neither he nor CAT spokespersons ever gave out any information about the impact of the Illinois tax increase on the corporate income (i.e. the net annual income of Caterpillar itself). Here’s Chicago Tribune reporting the CAT spokesman’s statement

He added that Caterpillar’s corporate taxes in the state also will increase but provided no estimate on the added cost.

And here is Chicago Tribune again on CAT

Caterpillar does not break out how much it pays in Illinois corporate income taxes, but taxes paid to states within the U.S. represented 4.7 percent of its worldwide tax bill last year, and only 1.2 percent of the company’s worldwide earnings. In 2009, the company had a loss in the U.S. portion of its business and therefore owed no state or federal taxes.

This lack of clarity and not wanting to turn attention towards their corporate taxes may have had something to do with the outing of the “tax fraud” that CAT had been perpetrating for some time.

Bloomberg.com published this on July 8:

Caterpillar Inc. used offshore subsidiaries in Switzerland and Bermuda to avoid about $2 billion in U.S. taxes from 2000 to 2009, boosting its earnings through a “tax and financial statement fraud,” according to a Caterpillar executive’s lawsuit. The company, the world’s largest construction-equipment maker, sold and shipped spare parts globally from an Illinois warehouse while improperly attributing at least $5.6 billion of profits from those sales to a unit in Geneva, according to the suit filed by Daniel J. Schlicksup. He was a global tax strategy manager for Caterpillar from 2005 to 2008.

So who lost the money here due to CAT’s supposed “tax fraud” ? – the State of Illinois.

While there was plenty of media coverage for Oberhelman’s letter to the Illinois governor, coming to the present nobody mentioned the incongruity of that letter when placed in the context of CAT’s “tax fraud” that reduced Illinois revenue. Libertarian financial bloggers like Mike Shedlock had gone all out against the state of Illinois when they got hold of the CAT CEO letter. Shedlock headlined his article as “Poisonous Illinois”. But when CAT’s $2 Billion “tax and financial statement fraud” came out in Bloomberg, Shedlock had nothing to say.

Despite the Bloomberg report, Oberhelman gave this gratuitous commentary during the recent Caterpillar earnings release :

“Lack of clarity on a U.S. deficit reduction plan, trade policy, regulation, much needed tax reform and the absence of a long-term plan to improve the country’s deteriorating infrastructure, do not create an environment that provides our customers with the confidence to invest,” Caterpillar chairman and CEO Doug Oberhelman said in the company’s earnings release Friday.

The real question is this: Why should anyone who isn’t a corrupt scumbag or a brainwashed fool take seriously anything that a crooked tax cheat like Doug Oberhelman says? And yet the Establishment–from the media to Washington politicians in both parties–worships every word uttered by CEOs like Oberhelman as if they’re talking the Gospel, rather than selling us snake-oil.

No wonder nothing’s improving in this country–except for the bank accounts of two-faced tax cheats CEOs like Doug Oberhelman.

Anathapindika is an engineer and lives in Detroit. He can be found wandering around the Michigan central station on most days. He can be contacted at: bhikkhuanathapindika at yahoo dot com.

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9 Comments

Add your own

1. SomethingSomething | July 26th, 2011 at 10:54 pm
I’m sorry this piece is trying to be Amesesque but the writing is a bit lacking in…how do I say…passion malheureuse?
2. Shedlock | July 27th, 2011 at 1:10 am
…. Fuck you. No really, I want to fuck you. I don’t come to where you guys work and ask you to take a shit on my face.
Look, my mother is evil- the broad is inherently a vile, stupid beast that destroys everything the she-thing touches. (with the exception of our proud men and women in uniform) But handsome father figures are pure, they maximize manliness and shave the world around them.
This is the American way to thick voluminous hair! They are all using Just For Men and violating zero laws with these so-called “grey loopholes” (so why aren’t they in prison if they are so evil, huh, Exiled?) but the attempts to raise my mother out of her Medicare Hoveround are inherently evil.
I think my mother is a conspiracy created by the “Federal” Reserve to enslave this country. (hey mom, how many times do I have to tell you to quit wiping your ass with my Alex Jones Federal Reserve Fanzine? Oh yeah, just can as you have brains) Supporting any form of my mother’s food increase is the same as pouring Jews into a burning oven. Funny that you guys brag so much about loving my mother. Just can’t get enough of my mother can you? Well, why don’t you donate all your extra income straight to my mother if it’ll make you feel so much better? You’re damned hypocrites if you don’t and it shows how full of it you all are.
In short, I want to fuck you my mother. I won’t address this story on my mother’s blog because there is an awesome story! Only my mother, Anarchist-loving libertard moonbat assholes like my mother give a crap against a proud American businessman trying to help all of humanity be better through lower taxes! So I will go back to demonizing my white business leader mother and fantasizing about murdering her and imprisoning her and then bitching about it on my mother’s shitty little blog that nobody even reads because you stupid my mother is too powerless to do anything else!
Mother!
3. tt | July 27th, 2011 at 4:59 am
High standards on the comment-improving as always…
The exile always knows what it’s doing, and so that is why we must all support the charitable comments-improving work of the Holy Exiled Moderator. It’s fun and funny watching dipshit morons like myself get yanked around. Only an idiot would pass up an opportunity that juicy.
4. Edmund Dorkey | July 27th, 2011 at 8:26 am
For the ragheads, it is katyusha rockets, rocks, and AK-47s, for the IDF, it is Caterpillar: http://www.jpost.com/Headlines/Article.aspx?id=192744
5. Oelsen | July 27th, 2011 at 4:29 pm
YES!
Come right here to Switzerland and bomb those assholes into democracy, right now! I suspect they are in Zug. Crippling our federal structure at the cost of Illinois and pretty much the rest of the world.
Bomb them, fast.
6. Anarchy Wolf | July 27th, 2011 at 5:55 pm
Yes taxes kill jobs, because the greedy motherfucking “job creators”(read: people that control the means of production) jump ship as soon as their profit margin begins to dip. Regardless of how obscene the profit margin still may be.
7. Floppy Boot | July 27th, 2011 at 10:54 pm
Anathapindika Bhikkhu, eh? Nifty name.
8. Cum | July 28th, 2011 at 4:06 am
Those capitalists don’t deserve the words anarchist or libertarian. They also don’t deserve respect or air but I guess we’re living in the Galt Epoch so they set the rules.
9. TCM | July 29th, 2011 at 10:07 pm
I sent Shedlock an e-mail. I can confirm, by how he took what I said like a bitch, that he is undoubtedly 100% Grade-A Bitch.