Apple Gives Employees $2,500 Bonuses After New Tax Law (bloomberg.com) 277
Apple told employees that it's issuing a bonus of $2,500 of restricted stock units, following the introduction of the new U.S. tax law. "The iPhone maker will begin issuing grants to most employees worldwide in the coming months," reports Bloomberg. Apple also announced today that it would bring back most of its cash from overseas and spend $30 billion in the U.S. over the next five years. From the report: Apple confirmed the bonuses in response to a Bloomberg inquiry Wednesday. The Cupertino, California-based company joins a growing list of American businesses that have celebrated the introduction of corporate-friendly tax law with one-time bonuses for staff. AT&T, Comcast, JetBlue, and Wal-Mart also said they were giving bonuses.
Why? (Score:5, Insightful)
Re:Why? (Score:5, Insightful)
It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.
Re:Why? (Score:5, Insightful)
That's why this move makes very little sense. I've never thought of anybody in Apple's upper echelons as being a Trump supporter by any stretch of the imagination.
There must be some tax advantage to doing this. Either that or they're bleeding people to Tesla, Google, and Facebook. Or both.
Re:Why? (Score:5, Insightful)
That's why this move makes very little sense. I've never thought of anybody in Apple's upper echelons as being a Trump supporter by any stretch of the imagination.
Quite right, they aren't. Puzzling, isn't it?
Maybe ... just maybe ... a better tax environment is better for business, which is better for paid non-governmental employment. Maybe wascally wepubwicans aren't as awful as you thought.
Re:Why? (Score:5, Insightful)
It gives the politicians who give away massive amounts of wealth to the corporations a simple talking point.
WTF?!?!!?
NOT TAKING from the people being governed is now "giv[ing] away massive amounts of wealth"?
So if I don't rob you at gunpoint, I gave you the contents of your wallet?
What the fuck is wrong with you?
Re:Why? (Score:5, Informative)
https://www.federalreserve.gov... [federalreserve.gov]
It explains that the United States is FINALLY starting to see an uptick in employment, with some labor shortages, which is key to ordinary Americans seeing an increase in their paycheck. Due to the economic outlook of further expected growth, companies that retain employees stand to grow; companies that don't retain their employees during a labor shortage will likely go out of business. So you're correct to be skeptical about generosity, but it IS an attempt to foster goodwill with their existing employees out of corporate self-interest.
Re:Why? (Score:5, Informative)
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Yup. I'd rather get cash myself. Sure, I still get some cash bonuses, but for awhile most of it was RSUs with strings attached. Every few months I'll get an email that says something like "7 shares have vested!"
Re: Why? (Score:5, Insightful)
BINGO! Precisely it. This is about employee retention above all else. Those of us of a certain age have seen this in the IT industry prior to Y2K. Back then we were seeing bonuses randomly throughout the year several times more than Apple is giving here, and it was a check instead of stock.
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Also, $2,500 is pretty sad.
It probably means a lot more to all those sweatshop workers making iphone parts... oh, wait, they aren't Apple employees, are they? Too bad, kids! Get back to work.
Re:Why? (Score:4, Interesting)
Also, $2,500 is pretty sad.
It probably means a lot more to all those sweatshop workers making iphone parts... oh, wait, they aren't Apple employees, are they? Too bad, kids! Get back to work.
No, but it probably will mean a lot to people working in Apple stores, Apple's corporate cafes, other non-engineering personnel, etc. For the engineers, not so much.
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At least for the low-wage corporate employees, I'd say most of them, actually. When I worked there, I used to see the same people working in the cafes every day for many years. The shipping and receiving people for my building knew me by name. And so on. Apple pays its low-wage employees significantly better than working at Mickey D's, plus they provide full medical/dental/vision benefits, an employee stock purchase plan,
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Which is probably still more than most companies will do. It's the way companies work in real life. If they become more profitable, the share holders make more money and the employees may get a thank you. If profits go down, some of those employees will lose jobs and salaries will be frozen across the board. Trickle down always stops a few feet outside of the board room.
Yep, almost as if supply and demand were a thing (Score:2)
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Yup. The common reason to hire more workers is if your company is expanding. And they never hire more workers than they actually need. In boom times they may make less prudent hiring decisions (witness the dotcom), but generally they're always paying attention to the bottom line. Extra revenue coming from company growth is likely to mean they want to expand. But extra revenue coming from a tax break is different - it doesn't mean the company is growing, they don't have a larger market, they haven't reduc
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Why?
The answer is in General Equilibrium, rather than limiting one's approach to Demand Side (i.e., Keynesian) or Supply Side thinking.
In competition, firms keep producing while marginal cost (the cost o making the next unit) is less than the marginal revenue (increased revenue from another unit [which is price in a purely competitive market, and somewhat less than price]).
Tax is one of the costs of production, as it is based on accounting profits. Produce and sell another unit, and it's a bit more tax.
I
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It's only a labor shortage for certain types of employees. Meanwhile there are many unemployed or homeless people who will only ever see the wrong kind of trickle down.
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Yes, Apple should hire all those homeless people who spent their teens and twenties partying and smoking dope. Now they are in their 30s and unemployable and camping in homeless jungles. It is Apple's obligation to hire these people so that they can make something of their lives. Sí, se puede!
One of the more significant groups of homeless people are ex-servicemen. Another is those who were abused by parents and thrown out in their teens. Another is those with significant and untreated mental health conditions. Party animals - probably a small proportion.
Re: Why? (Score:2)
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More deficits? What the hell do you think Obama did doubling the national debt in 8 years?
Yes, what did Obama do?
Spent money on a war started before he was inaugurated as president
Spent money on a stimulus package authorized before he was inaugurated as president.
Spent more money on additional stimulus packages he did authorize, to continue fixing problems that were in place when he entered office.
Spent on 8 years worth of budget deficits, which started at $1.4 trillion/year when he entered office and were cut in half by the time he left office.
That accounts for a majority of his debt increase.
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And remember, we're not supposed to worry about the war, and just pretend that everything is normal and spend money instead of save it, otherwise the terrists win.
Of course, not necessarily Bush's fault either. Rumsfeld was trying to shrink and optimize the military. And then you back to earlier presidents and the earlier, and the chain keeps going back a long ways. Anyone blaming a deficit on a single president is deluded. But in the game of Us Versus Them, you're required to blame Them.
Also remember,
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Pork barrel buys votes on the spending of trillions for the price of a few million per district, which amounts to ten thousandths of a penny on the wasteful dollar.
What a deal!
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The Democrats ran up the deficit tremendously, it's true. Thank god the Republ...
Oh, no. They are in charge of everything and will add $1 trillion to the deficit this year alone.
Nevermind.
Re: Why? (Score:4, Interesting)
Did the GOP trick Obama into not vetoing it?
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Exactly. The debt nearly doubled under Obama, but it would have been worse without him. Just because in his eight years it increased almost as much as it did the prior 232 years doesn't mean it's his fault.
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I think it's called "marketing".
Sad that the highly paid Cupertino employees get a bonus, but the assembly line staff in China still get far far less than minimum wage.
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What about the Assembly line employees in Wisconsin... Oh that's RIGHT, they don't exist YET, but I hear they will.
Isn't Apple planning to bring a pile of cash home and set up a manufacturing facility in the states? Thought I saw that in the news today. If that's true, my guess is the Chinese contractors will be phased out and their employees cut loose for the state to support. Not good for China, but great for the US..
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No, they're not going to give up on all those Chinese factories. It means that they may set up a new plant, either for new work, or to augment existing work. I doubt it will replace anything though. If you're manufacturing in bulk and it requires a lot of labor, then the US is not a good place to do it. But there's still demand for US manufacturing in other areas; automated plants for parts, or building/assembling items with smaller quantities (macbooks maybe). For manual labor, most companies want cheap
Comparisons (Score:2)
What's worse, making less than (I assume you mean US) minimum wage in a factory in China, or making almost nothing working on a farm in China?
Also keep in mind that whatever machine you are currently using to write your post was probably made by the same factory workers in China making almost nothing. At least, most of the parts were.
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What's worse, making less than (I assume you mean US) minimum wage in a factory in China, or making almost nothing working on a farm in China?
What's worse, being paid almost nothing in a factory that might close down the minute someone builds a machine to do what you do, or to be working on a farm where you can at least grown your own food?
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Newsflash! The workers on the farm don't own the land.
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I think it's called "marketing".
Sad that the highly paid Cupertino employees get a bonus, but the assembly line staff in China still get far far less than minimum wage.
Not saying that the China staff aren't underpaid. However, minimum wage only makes sense when you compare cost of living. I could live like a fucking king in Thailand on about $30k a year, but I couldn't feed and shelter my family here in the DC burbs for the same amount. One site (https://www.numbeo.com/cost-of-living/in/Shenzhen) suggests that the cost of living near the Apple factory in China is about half that of NYC.
Re:Why? (Score:4, Insightful)
Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?
Why they'd give employees bonuses? Retention, mostly. This is obvious, isn't it?
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Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?
My suspicion is it's to publicly fulfill a backroom promise to a politician. I.E., "Put XYZ in the tax law and we'll do this to make it look like it's working."
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Can any corporate finance experts explain why companies would do this? Should we buy that they're just being generous/trying to foster goodwill?
IANACFE but...
The tax cut is awesome for corporations, and their major shareholders in particular.
But, it's also extremely unpopular because it's generally considered a handout to corporations at the expense of average people, and that creates two problems.
1) Employees realize the company got a massive pile of cash and can feel resentful that they didn't get any. Resentful employees are employees who might look for work elsewhere.
2) Nationally the tax bill is unpopular, and there's a decent chance that in 4
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The tax cut gave me a $1,000 this year. Fuck corporations. I give a shit not about them. I got my money.
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The tax cut is awesome for corporations, and their major shareholders in particular.
Don't know about you, but my 401k is up nearly 30% since the election in Nov of 16. Why? Because the markets have been anticipating this tax cut, and now they've got it. Many of you were whining right after the election that this was just a Trump bubble. Well, the bubble has gone on for 15 months now, and will likely pop at some point, but will hardly get near where it was before it started.
Why WOULDN'T they? (Score:4, Insightful)
There are a million reasons I can think of.
If all you can do is ascribe selfish reasons to any action, then here is one for you - with some many companies having more money to spend, there were be a lot more poaching of workers going on, and companies are trying to head defection off at the pass by fostering goodwill among employees.
But again only for absolutely selfish reasons, could not be they are just passing along some good fortune to those that helped them get where they are.
Re:Why? (Score:5, Insightful)
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Partly employee retention, and partly midterm elections this year to protect the corporate tax cuts. People will vote based on how their wallets feel this year, not based on the lack of any actual pay raise long term or the size of the deficit.
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In general, I would say tax deductions. It's also in restricted stock units, so they may be trying to get rid of holding onto stock by giving it away to their employees.
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Fwiw I used to get restricted stock bonuses at Adobe most every year - this is when I worked there 10-12 years ago. They only vest after 5 years - which is what what Apple did in this case. Still after they did layoffs in 2010 (I think) I had collected well over 20k of these - and its not like I was senior engineer of anything (I was a technical account manager).
These sorts of things never made the news though ;) - its pretty normal in any decent sized company in silicon valley.
Anyhow like I said - its not
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Because it generates PR and doesn't cost anything. "Restricted stock units" is worthless to the employees.
If they wanted to give an actual bonus, they'd give cash or actual stock, you know, like the company's execs probably got. Everyone else just gets blue-sky.
Silicon valley may do some old-school engineering, but this is an example of what they are really best at- financial engineering. It generates maximum buzz for minimal cost, and probably gets the company another tax break.
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But why, if they still have to pay some tax. Surely it would make even more sense to spend that money abroad and pay no tax.
bloody hell...just how neo-con is this site now? (Score:3, Insightful)
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Calling Bullshit on this. Bullshit!
Of course you could cite credible sources and prove your case.
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Someone seems to have more mod points than sense.
Re:bloody hell...just how neo-con is this site now (Score:5, Informative)
Of course you could cite credible sources and prove your case.
Credile source #1 [businessinsider.com]
Among that group of employees, only those who have worked for Walmart for 20 years or more will get the full $1,000, Walmart told Business Insider.
Credible source #2 [cnbc.com]
The bonuses will be determined by an employee's length of service. Those workers with more than 20 years of experience will qualify to receive the full $1,000. However, workers with less than two years of experience will receive $200, a Walmart spokesman told CNBC.
Credible source #3 [walmart.com]
A one-time bonus benefiting all eligible full and part-time hourly associates in the U.S. The amount of the bonus will be based on length of service, with associates with at least 20 years qualifying for $1,000. A discrete one-time charge will be taken in the fourth quarter of the current year to account for the bonus; qualification will be determined before the end of the month and payments will be paid as quickly as practical thereafter.
As to the difference between the income of those laid off and the bonuses, this article [reuters.com] cites the bonuses will cost $400 million. This article [businessinsider.com] says 9,400 people are being let go during the layoffs. Simple math shows $400 million/9,400 = 42,553. If we assume those being laid off made that much in salary and benefits, then after one year, the amount of money saved by laying off those people will dwarf the one-time bonus amount.
Re:bloody hell...just how neo-con is this site now (Score:4)
Yup, that will do it.
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Since nobody wants to actually do a simplistic google search that takes all of 2 seconds, here's [cnbc.com] a source about it.
It is part bullshit, part not. The bonus of 1000 dollars for employees is only given in full to those who are part of that sad little 20yr group. Those who have worked 2 years or less (probably the majority of Walmart employees) will only get 200 or so.
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It is not that someone can't or won't do a "simple" google search. It's the fact that my google search will yield different results from the OP. Google search results change by the hour, or even by the minute. Even if I knew the exact search terms he used to get his information that doesn't mean I will be looking at the exact same article.
By asking for him to cite his links I'm looking at the exact same data he is.
Re:bloody hell...just how neo-con is this site now (Score:5, Informative)
You've gone mental Mr Huffpo (Score:3, Insightful)
Ask me how I know you've gone mental with liberal hate.
Ok, here's how I know - because the story is about APPLE. not WALMART.
APPLE just announced they are hiring 200k employees over the next five years and spending tens of billions more in the US, since they can finally bring money back from overseas. There are no layoffs.
Meanwhile in completely unrelated news WALMART is just one of many companies giving out bonuses, that just happens to also be laying off some workers. That does not change the benefit o
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http://www.foxbusiness.com/fea... [foxbusiness.com]
You're an order of magnitude off on that 200K figure...it's 20K jobs. Nothing to scoff at, but also not 200K new jobs.
Also from the article, "most of the $350 billion reflects money that Apple planned to spend with its suppliers and manufacturers in the U.S. anyway, even if corporate taxes had remaine
"After" is carrying a lot of water here (Score:5, Insightful)
So I read the linked article, and I couldn't help but notice that the only thing joining the tax law and Apple's bonuses was temporal proximity. The author conspicuously chooses to use words like "after" and "following the introduction of," assiduously avoiding the more concrete "because of." The author also doesn't attribute anything the company actually stated to the tax law, citing instead some phoney-baloney hogwash about "confidence in Apple’s future."
In fact, if you read the text of the email sent by Tim Cook to Apple employees, [9to5mac.com] you don't see mention of tax policy anywhere--which is weird, seeing as Bloomberg puts "New Tax Law" right in the headline.
It's almost as if Bloomberg.com were blowing smoke up our collective asses and calling it an invigorating Goop.com vapor colonic.
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NO! (Score:4, Funny)
Republican tax cuts are evil!. Millions will die. Even though the standard deduction doubles, those who make minimum wage will starve as the rich will laugh eating there bones!
Bonuses are much cheaper than pay raises (Score:4, Insightful)
So you're a big company, and you don't want trouble from the government. Of course you're going to do something, if you can, to make yourself look good!
But notice how all these announcements are about bonuses, not pay raises. A bonus is just a one-time event, pay raises keep on giving, month after month. These companies aren't really putting their money where their mouth is, they just want to make a splash in the news.
Good Employee-Employer Relations (Score:2, Interesting)
This makes good sense. Apple's getting a windfall from the tax law changes and they're spreading the good cheer. Some of that money goes to employees which makes employees more loyal and more likely to stay and do well at Apple. Most of that money will likely go to Apple's research and development and other initiatives that drive their company. A lot of that spending will be in the USA which is why the politicians wanted to make the change to the laws. This brings home (to the USA) a lot of cash. Good for t
The writing's on the wall... (Score:5, Informative)
Restricted stock units? (Score:4, Insightful)
And they call that a bonus?
I'll bet the execs get unrestricted stock.
Same BS, different decade.
I was an engineer in the 90s and got stock options the day my company went public. The tee shirt I got on that day ended up worth more than the stock.
If it isn't cash, it's worthless. Don't accept this BS in lieu of money or even actual stock. It's a PR gimmick.
Apple *and* Trump?? (Score:3, Funny)
Watch the techie heads explode like a 60's scifi robot caught in a contradiction, lol :)
Must love Apple ... must hate Trump ... must love Apple ... error, error ...
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They're using that money for shiny new robots, that won't be subject to the new higher minimum wage.
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My libby brother did this with me just yesterday.. Claimed that the stores that Sam's was closing was putting folks out of work, so Walmart's bonus and raise plan didn't show the tax plan was working....
How did this idiot come from the same gene pool as me? Must have been a bad mutation..
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But tax cuts are evil even though the standard deduction for everyone is doubled.
Yes, but the personal exemption is eliminated...
Now, I only file a standard plebeian 1040-EZ, so someone with more complicated taxes can correct me- but I believe that makes it a no-op...
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You noticed that too. Flamebait, Most these mod wouldn't know a Troll if one drug them under a bridge.
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He got his sources and then pretended they didn't exist. His agenda was to try to pretend the truth is fake. Flamebait was merciful and more than he deserved.
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No, I didn't. What I got was sources from a Usefull Idiot. Which I have looked over and asked more questions about. AndI also agree the timing is kind of off.
But what I asked for is your sources, PopeTazo. Sources that I've noticed that you have yet to provide. But this is not surprising coming from you. I have asked for you to cite your sources to which you have never done so.
So again. Cite your source and please make sure they are credible sources.
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Here you go. I'm flattered that you prefer my sources to the other poster who provided them. Happy to oblige (the last one is a nice summary)
http://www.kansascity.com/news... [kansascity.com]
https://arstechnica.com/tech-p... [arstechnica.com]
https://www.nytimes.com/2018/0... [nytimes.com]
https://www.vice.com/en_us/art... [vice.com]
Re:Uh-oh, you know what this means (Score:5, Interesting)
So lets look at your original statement here.
So far, every single company that has announced employee bonuses thanks to the tax bill has followed with an announcement of layoffs shortly afterward. In some cases, the dollar savings of the layoffs almost exactly matched the dollar cost of the bonuses.
Which is a pretty broad statement, leading to me to call bullshit, and asking you to cite your sources. What I get is 4 articles about 3 companies that have laid off employees while giving bonus to others. I also requested credible sources, I'm not sure that Vice qualifies but we'll let it slide.
Now then, you calm that in some cases the dollar savings by the layoffs almost exactly match the dollar cost of the bonus. Yet, in none of the articles do they give numbers for you to reach that conclusion. Vice tosses some numbers around but those seem to be just guesses. Vice tosses around a number like 4,000 but the real number seems to be closer to 700 in AT&T case. Plus the fact that Comcast is giving bonuses to the people it laid off clearly shows that your assessment is in error. So that part of your statement is wrong.
Now then. You state that every single company that has give an bonus as also announce a massive layoff. But yet SuperKendall has posted a link to over a 100 companies giving "Trump Bonus." So unless you can provide evidence showing each and everyone of those companies is having a massive layoff that part of your statement is false too.
So basically Bullshit was the correct call. Any questions?
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Yes, the Wal-Mart bonuses almost exactly equal the savings in closing the Sam's Club stores. You can find the figures in two consecutive articles in Money magazine, but I'll let you find them for yourself, since you apparently need some practice using a search engine.
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Which would make you incorrect, yet again. I'm very aware of how to work a search engine. What you need is practice in learning how to back up your bullshit. You see, you make the claim so therefor its up to you to prove it. Not the other way around. I'm in no obligations to do your research for you.
So again. Cite your sources. Please provide the appropriate links to the articles in Money magazine for everyone to see. I will read them. An once I have done so I will provide counter evidence i
Re:Uh-oh, you know what this means (Score:4)
That something, is someone. Another user on slashdot who posted a link that refutes your bullshit too.
https://slashdot.org/comments.... [slashdot.org]
There is a link to that post. Take note of the link in that post that clearly refutes your bullshit.
So far, all you've cited is something called a "SuperKendall" which I assume is some sort of sex toy for homosexual men..
I'm not what exactly you mean but this post though. It seems to make some kind of derogatory comment about homosexual men. Which if it does makes you one sorry excuse for a human being.
It also means we are done here. You clearly have no data to back up your clam. Therefor you are just as much full of shit as it is. In the future you should learn to make sure you can back up your bullshit because some of us won't baffled by it.
But most importantly if I was you I would work on my homophobic issues. I believe you can get physiological help for it. I would suggest you do so.
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Really? All but two. Care to cite your sources? Any one can make shit up, which you seem to like to do. So cite your sources or it didn't happen.
Oh an by the way. Your statement was "All the companies" not "nearly all the companies." So two companies out of 100 is still not ALL.
Now cite your sources or go back your therapy. You have real issues in your personality that you need to address.
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Unless you care to cite your sources here and now this discussion is over. Prove it or it didn't happen as far as you are concerned. Last time, cite your data.
You should also apologize for your homophobic comment.
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Comcast is a scummy company anyway so I wouldn't put it past them to do something like this. But in that article is said those getting laid off are getting a "$1000 supplemental payment." So, basically they are getting the $1,000 bonus too.
But looking the evidence here only raises more questions. First there is nothing in the articles that link the layoffs to bonuses. While I can see where you might get the impression that it is, more likely the layoffs where already planned and have nothing to do w
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"As you all know, first prize is a Cadillac Eldorado. Anyone wanna see second prize? Second prize is a set of steak knives. Third prize is you're fired. Get the picture? You laughing now?"
https://youtu.be/elrnAl6ygeM [youtu.be]
That's three out of 100+ - and of course !Apple (Score:3, Informative)
That is three, out of over 100 [washingtonexaminer.com].... the original claim was "every" company giving bonuses was doing layoffs.
So, #FakeNews (aka Bullshit)
That list was before Apple too. Looks like the wave continues, and Apple alone is hiring 200k people over the next five years. Again when you say "every" company is doing layoffs in the very story where the company giving bonuses is hiring... well, #FakeNews.
Thanks Trump! (I added that last part just for you to enjoy).
Not free. Freed. (Score:3)
remember who to thank when we have to pay
Why would we have to pay anything? It's on Apple. And other companies...
Apple alone is paying $38 billion [reuters.com] in taxes to bring cash back to the US.
And (in the article) it notes Apple plans to spend over $350 billion in the U.S. over the next five years thanks to all of the cash it can bring back. All of that spending will also be taxed... along with the 200k employees Apple plans to hire.
Apple is not the only company in this same boat, many others have stashed funds
Also raises (from cut and otherwise) (Score:3)
Bonuses..not raises.
In fact some companies are giving out raises [usatoday.com]... including WalMart, so that report of WalMart saving more in layoffs than they spend in bonuses is kind of #FakeNews since as you point out, raises will be around forever.
But also even those not giving out raises - the employees get raises ANYWAY because withholding from each paycheck will be lower. People all over the US are seeing higher paychecks now, because of the supposedly deadly tax bill passing...
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NDA's? What's wrong with that? They likely signed such documents when they STARTED there not when they get shown the door. Nothing wrong with NDA's. I think you are talking about Non-competes, which in the case of Apple's employees in California, don't apply because the local California courts won't enforce them.
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You know they will *try* to make that claim. I've already heard a number of attempts to do this.
Crazy campaign season rapidly approaches. You can pretty much bet that what ever the politicians are saying is about votes and not the truth. This year will be worse than most because of the polarized political reality and visceral hate for one side by the other.
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You know what's strange? Everyone in the US seems hell bent on claiming the government should keep out of businesses and that everything runs smoother without government meddling in things... but no matter WHAT happens in the economy, somehow either the current or the former president are to blame for it.
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"Dental plan!"
"Lisa needs braces!"
"Denta
There are optimal tax rates, here's why it's obvio (Score:5, Informative)
Obviously, a zero percent income tax rate will result in zero income tax revenue. Just as obviously, a 100% tax rate (the government takes your ENTIRE paycheck) will result in roughly zero tax revenue - most people won't work a job if they don't get to take home a paycheck. Also companies wouldn't have any reason to.pay more than minimum wage - employees don't demand more because they don't get any of it anyway.
So we can see that tax rates too low result in little or no revenue, and we can see that tax rates too high result in little or no revenue. That's obvious even without understanding the basics of economics, without even knowing the difference between microeconomics and macroeconomics, for example.
If the current tax rate is 80%, that hurts revenue and reducing the tax rate to 70% will increase revenue. If it's at 2%, increasing the rate to 10% will increase revenue. So what we can see, without even reading Chapter 1 of Economics 101 is that anyone who says "increasing tax rates increases revenue" is an idiot, and anyone who says "decreasing tax rates increases revenue" is similarly clueless. There is an optimal rate, not near 100% and not near 0%, that maximizes revenue. Raising rates above the optimal rate hurts revenue, reducing them below the optimal rate reduces revenue.
Also, complex tax laws create "compliance costs". Small businesses file taxes about sixteen times per year - quarterly federal returns, quarterly sales tax returns, quarterly unemployment tax returns, annual business personal property tax returns, etc. There is a real cost to all that, even of the business only owes $1, that's a lot of tax paperwork. (I've filed returns for 12 cents before - the cost / time to fill them out was much greater than 12 cents, so the current situation is a significant net loss for the economy.)
Corporate tax rates follow the same reasoning. If you taxed them at 100%, nobody would invest their savings into starting or growing any companies, since they can't make money. The economy would come to a halt and there would be no revenue (and nearly 100% unemployment). On the other hand, with a 0% corporate tax, you have no revenue from corporate taxes, but higher savings and investment, much better returns from your 401k, lower unemployment, higher wages, etc. So again there is an optimum rate. Too high hurts revenue, and too low hurts revenue. Too high also hurts a lot of other things. Fortunately, corporate taxes have been around for many years, many different rates in many different countries, so economists and policy makers can see how each worked. Based on the data, most countries optimize their revenue by setting corporate tax rates at about half of what the US has had. A few countries have tried very high corporate tax rates. A corporate tax rate of nearly 100%, where the government takes all the profits, is called communism. The USSR tried that. China tried that for a while and reversed course before they ended up like the USSR.
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That's not true. Our corporate tax rates were about the same as Germany's and Japan's if you factor in loopholes actually used. Those are the two top-performing democracies in the world, besides US. If their rates are somehow "sub-optimal", it didn't hurt them enough to knock them from the top two positions.
Now, I'm not necessarily against lowering our corporate tax rates some, but we
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Don't fool yourself. Apple is in this for Apple's profits, not for republicans, democrats or even you, except where they can dip into your wallet.
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So ... those hipsters with their flavored coffee are ... Republicans?
Wow, I was away too long.
Re:Impossible. RUSSIANS. (Score:5, Insightful)
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More probably than not they're just trying to get all the EU profits they didn't pay any taxes on back home as quickly as possible on now after the EU knows about this after someone blew the whistle on their illegal and secret deal with the Irish.
Let me ask a serious question:
Is there ANYTHING that Apple could, or would, do in ANY scenario that you would NOT find a way to find a way to spin-negatively?
Seriously.
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More probably than not they're just trying to get all the EU profits they didn't pay any taxes on back home as quickly as possible on now after the EU knows about this after someone blew the whistle on their illegal and secret deal with the Irish.
What kind of idiot would come up with the idea that you wouldn't need to pay taxes if you moved the money out out country (or continent)? Not to mention that the EU doesn't tax anybody nor anycorporation.
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