Obama Fundraises At Google Exec's House Same Day Company's Tax Loopholes Revealed
Hours after Bloomberg News revealed Google's billion dollar scheme to avoid corporate taxes, President Obama spoke at a Democrat fundraiser held at the home of one of the Internet giant's executives.
The Democratic fundraiser, which guests each paid $30,400 to attend, was at the home of Marissa Mayer, one of Google's best-known executives. At the lavish home, which was "decked out in Halloween decorations on steroids," according to a White House pool report, Obama spoke briefly and had nothing but praise for Google. He spoke fondly of his first visit to the company when he was an Illinois state senator.
Indeed. Here are portions of his speech posted at WhiteHouse.gov:
I see a lot of old friends here, people who have supported us for a very long time, and I see some new ones as well. Some of you I had a chance to meet around the same time I first met Marissa. I remember that first visit to Google very well. In fact, it made it into my second book. And I talked about how inspiring it was and how it spoke to the essence of America -- the American idea that if we’re innovating, if people have the tools to let their imaginations run, that there’s nothing we can’t do in this country.
And that’s I think the spirit that all of us want to see recaptured after a decade in which, frankly, that can-do spirit had been lost. Obviously we’re going through a very difficult time right now -- the worst financial crisis since the Great Depression, the worst recession since the Great Depression. But my task over the last two years hasn’t just been to stop the bleeding. My task has also been to try to figure out how do we address some of the structural problems in the economy that have prevented more Googles from being created, prevented more Hewlett-Packards from being created, prevented more engineers from being trained in our schools -- how do we unleash this incredible energy and dynamism that we know has always driven America, decade after decade.
Earlier that same day, Bloomberg reported:
Google Inc. cut its taxes by $3.1 billion in the last three years using a technique that moves most of its foreign profits through Ireland and the Netherlands to Bermuda.
Google’s income shifting -- involving strategies known to lawyers as the “Double Irish” and the “Dutch Sandwich” -- helped reduce its overseas tax rate to 2.4 percent, the lowest of the top five U.S. technology companies by market capitalization, according to regulatory filings in six countries. [...]
The tactics of Google and Facebook depend on “transfer pricing,” paper transactions among corporate subsidiaries that allow for allocating income to tax havens while attributing expenses to higher-tax countries. Such income shifting costs the U.S. government as much as $60 billion in annual revenue, according to Kimberly A. Clausing, an economics professor at Reed College in Portland, Oregon.
As York pointed out:
In the past, Obama has been sharply critical of companies that move their income around the globe to avoid paying taxes. But with Google, whose employees give an estimated 75 percent of their political contributions to Democrats -- well, the president didn't have much to say about taxes.
I imagine not.
Also disinterested in Google's tax issue and how it related to the President doing a fundraiser at Mayer's house was the rest of the media.
According to LexisNexis and Google news searches - isn't that ironic! - not one major press outlet other than the Washington Examiner thought it at all odd Obama would be doing such an event on the very day this tax loophole was reported.
This isn't to say the fundraiser was ignored. The New York Times reported Saturday:
But by the time the president got to the swank Palo Alto home of Marissa Mayer, a Google executive, and her husband, Zachary Bogue, a private-equity executive, a few hours later, Obama Two was running the show. “My main message is to say ‘thank you,’ ” Obama Two told the 50 or so deep-pockets sipping wine and munching salmon at six tables in the Mayer-Bogue great room. He recalled that his first trip to Google as an Illinois state senator, when he first met Ms. Mayer, made it into his second book.
“How inspiring it was, and how it spoke to the essence of America,” Obama Two said, standing next to the Mayer-Bogue granite open-kitchen counter, as a photo montage of the couple’s wedding played on a computer flat screen behind him. “The American idea that if we’re innovating, if people have the tools to let their imaginations run, that there’s nothing we can’t do in this country.”
Not surprisingly, author Helene Cooper didn't mention Thursday's revelations concerning Google's massive tax loophole.
The Washington Post also covered this event Saturday:
Indeed, during Obama's visit to California this week, he spoke at a Democratic Party fundraiser hosted at the Palo Alto home of Marissa Mayer, Google's vice president of search products.
Not a peep about Google's taxes.
The San Francisco Chronicle reported the affair on Friday, but also didn't address the tax issue.
Add it all up, and it appears not one American media outlet other than the Examiner saw a connection between Obama's fundraiser and Google's taxes. Nobody found it all interesting that Google's President Eric Schmidt campaigned for Obama in 2008 either.
Would the press have been so nonplussed if the President was a Republican?
Imagine for a moment this was George W. Bush doing a fundraiser at the home of a Halliburton executive on the very day it was reported the oil construction giant was using loopholes to evade billions in corporate taxes.
Think the media would have been interested in such a story?
Yes, that was a rhetorical question.