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Ford, like Exxon, is enjoying monster profits right now. But of course there are no calls for “excess profits taxes” on them. I hereby propose one. Here is a nice bit from the news story:

Ford will pay profit-sharing checks of about $8,300 to its 45,000 hourly workers in the U.S. represented by the United Auto Workers union.

I suppose Exxon’s massive profits end up in the hands of its CEO and no-one else? And here, I suppose the entire payment is just a tax-loophole. I propose that Comrade Obama put an end to those loopholes:

Ford pays the profit sharing based on the pre-tax operating profit generated by the North American division.

Ford should invest some of its profits in Exxon so it can fund its retirement plan:

Ford ended 2012 with a world-wide underfunded pension obligation of $18.7 billion, compared with around $15 billion at the end of 2011, despite Ford making $3.4 billion in cash contributions to the pensions in 2012.

Here is the news story. It doesn’t tell us whether all of these profits are because of F150 sales of because of electric car sales or something in between.

 

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4 Responses to “Whither the Excess Profits Tax?”

  1. Scott says:

    Starbucks is paying £20M in “good will” UK taxes, as a response to allegations that Starbuck’s is not paying its’ fair share worth of taxes. It’s a good thing too; public service announcements reminding me that I am under CCTV surveillence are not free.

    Starbucks made £0 in profit in the UK in 2012.

  2. Harry says:

    Why worry about an underfunded pension plan that will be bailed out by the government at eighty cents on the dollar?

    I bet the pension plan managers have not doubled down on electric cars by buying General Motors common stock.

  3. Harry says:

    But I will not bite and begrudge Ford its profits, and whatever they decide to do with the money, as long as they do not become a public burden. They could drop $100 bills from an airplane flying out of Grosse Pointe and finishing over Detroit, for all I care. Of course, the chairman would have to announce these plans in advance to avoid the fate of Ken Lay, who did not warn investors of having hired Paul Krugman as an advisor, using Arthur Andersen, and not disclosing off-balance sheet ventures, etc.

  4. Harry says:

    A historical observation: during World War II,we got rationing and Harold Ickies senior, who was in charge of near dictatorial powers to control everything that went on with prices, including excess profits. My parents, their friends and family, and everyone else I can recall endured this to defeat the Germans and Japanese.

    Just because Stalin was not vanquished in the conflict should not mean his economic ideals should live in our hearts.

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