The Democratic/Progressive war against high tech intensifies

The Democratic war against Silicon Valley businesses intensified this week.

Democratic Senator Carl Levin from Michigan raked Apple CEO Tim Cook over the coals in a session of the Senate Permanent Subcommittee on Investigations because, in the opinion of the honorable senator, Apple is not forking over enough dough to the IRS. Levin accused Apple of using "sham" entities, "gimmicks," and "convoluted and pernicious strategies" to avoid paying taxes.

Republican Senator from Rand Paul of Tennessee, a Tea Party favorite. disagreed with Levin:

I, frankly, think the committee should apologize to Apple. We haul before this committee one of America's greatest success stories, and you want applause? I say instead of Apple executives we should have brought in here today a giant mirror, okay? So we could look at the reflection of Congress, because this problem is solely and completely created by the awful tax code. If you want to assign blame, the committee needs to look in this mirror and see who created the mess, see who created this tax code that is chasing American companies overseas.

Tim Cook himself testified:

With all this growth and investment, Apple has become – to the best of our knowledge – the largest corporate income taxpayer in the United States. Last year, our U.S. federal cash effective tax rate was about 30.5%, and we paid the U.S. Treasury nearly $6 billion in cash. That’s more than $16 million per day. We expect to pay even more income tax this year. ... We pay all the taxes we owe – every single dollar.

This statement by Mr Cook is, of course, correct; if Apple were doing anything illegal, the IRS and the Justice Department would be all over them like flies on jam (or, to use a more timely analogy, like Lois Lerner on Tea Party organizations applying for tax-free status).

Already last year I published a blog post in which I detailed the war being waged by Democrats and Progressives against Silicon Valley businesses. The attacks come in the form of a variety of charges made against high-tech companies:

1. they destroy low-skill jobs by automating more and more tasks;
2. by destroying these jobs and concentrating wealth in the hands of a small class of knowledge workers, they contribute to income inequality;
3. they engage in racist and sexist hiring practices because they don't hire enough blacks, Hispanics, and women (for more discussion of how this attack will play out, see my recent post on the coming impact of disparate impact);
4. they do not pay enough corporate income tax;
5. they focus entirely on profit, pursuing business goals exclusively, while ignoring their "social obligations" (generally defined as whatever programs Democrats and their dependent constituents support).

The charge that high-tech companies destroy low-skill jobs by increasing automation is one that I find particularly hard to stomach. What is modern society supposed to do? Should we construct Potemkin villages and Colonial Williamsburgs, where everyone dresses up in costume and reenacts the jobs of the past (churning butter, for example, or hewing logs with an adze)? That is, are we to create jobs and employ people not because these jobs are the most efficient way of doing something, but merely because they provide income for some group of people who are unemployable in jobs that produce real economic value? This is pure Keynesianism, of course, where it supposedly does not matter how money is spent, but only that it is spent. What you end up with under such a regime is, of course, a situation where capital is forcibly taken from those sectors of the economy with the highest return on investment and redistributed to an ever increasing number of sectors where capital is allocated inefficiently. How such an operation of legalized theft, implemented, apparently, through the kind of tax regime that Senator Levin would prefer, can ever result in a free and prosperous society is never explained.

At any rate, I still wonder when Silicon Valley executives and engineers are going to wake up and realize that Democrats are not their friends. Instead, Democrats see Silicon Valley as just another fat goose ripe for the plucking, another store of treasure ready to be plundered and redistributed to their liberal political dependents/supporters.