On the eve of tomorrow’s unemployment report for April, we get this news from Fortune:
Profits of the 500 largest U.S. corporations soar by 81 percent ($318 billion), the third largest percentage gain in list history…Wal-Mart holds the number one spot for the second year in a row…Exxon Mobil leads profits with $30 billion, for the eighth year in row.
The stunning leap in profits is so excessive even Fortune writers are writhing in their leather chairs:
We’ve rarely seen such a stark gulf between the fortunes of the 500 and those of ordinary Americans….The profits derived partly from productivity gains, including workforce reductions. And many 500 companies are growing faster overseas than in the U.S.
Here’s the full list of the top moneymakers: http://bit.ly/mnrPsI.
So what are Wall Street CEOs doing?
Screaming for more tax breaks. Listen to them holler about how the United States has one of the highest corporate tax rates in the world. And then read on to see why these corporations actually pay less—if anything—in corporate taxes than their counterparts in other nations. From the New York Times:
By taking advantage of myriad breaks and loopholes that other countries generally do not offer, United States corporations pay only slightly more on average than their counterparts in other industrial countries. And some American corporations use aggressive strategies to pay less—often far less—than their competitors abroad and at home. A Government Accountability Office study released in 2008 found that 55 percent of United States companies paid no federal income taxes during at least one year in a seven-year period it studied.
As our Executive PayWatch site points out, U.S. corporations held a record $1.93 trillion in cash on their balance sheets in 2010.
But they are not investing to expand their companies, grow the real economy or create good middle-class jobs. Corporate CEOs are literally hoarding their company’s cash—except when it comes to their own paychecks.
Something to think about, because even if tomorrow’s job report shows improvement in the number of unemployed workers, more than 25 million will still be unemployed or underemployed.