theodp writes: 'There's a funny thing about the estimated $1.7 trillion that American companies say they have indefinitely invested overseas,' reports the WSJ's Kate Linebaugh (reg. or the old Google trick). 'A lot of it is actually sitting right here at home.' And if tech companies like Google and Microsoft want to keep more than three-quarters of the cash owned by their foreign subsidiaries at U.S. banks, held in U.S. dollars or parked in U.S. government and corporate securities, Linebaugh explains, this money is still overseas in the eyes of the IRS and isn't taxed as long as it doesn't flow back to the U.S. parent company. Helping corporations avoid the need to tap their foreign-held cash are low interest rates at home, which have allowed U.S. companies to borrow cheaply. Oracle, for instance, raised $5 billion last year, paying an interest rate roughly two-thirds of a percentage point above the low post-crash Treasury yield, about 2.5% at the time (by contrast, grad students and parents pay 6.8%-7.9% for Federal student loans). Were the funds it manages to keep in the hands of its foreign subsidiaries brought home and subjected to U.S. income tax, Oracle estimated it could owe Uncle Sam about $6.3 billion.
theodp writes: Over at CNN, David Goldman opines that you need a touchscreen for Windows 8. 'The ability to touch, tap, swipe and pinch on Windows 8 computers is what makes the new operating system come to life,' Goldman writes. 'You can still use Windows 8 without a touchscreen, but that's kind of like tossing aside the remote, getting up, and repeatedly pushing buttons to change the channel on your TV.' Just 5% of Win 8 laptops sold through Dec. 15 had touchscreens. At $500 or so, the Asus VivoBook with its 11.6" screen is the cheapest touchscreen Win 8 laptop, which helps explain why many are settling for budget u-can't-touch-this Win 8 laptops until prices fall, which is expected to occur in mid-2013.
theodp writes: Apple iOS parents, reports GeekWire, can pick up the Dr. Seuss classic How the Grinch Stole Christmas in app form for their kids this holiday season for 99 cents. The interactive storybook app is also available for Xmas gift-giving by Windows 8 parents, but they'll pay $4.99 for a version that lacks the features available in the $0.99 iOS version. Which raises some interesting questions: 1. As concerns are being raised over a new Digital Content Divide, is it cool to have owners of the cheapest computers pay 5x the price charged to the most elite consumers, especially for an inferior port of an existing app from the same vendor? 2. Why exactly does a port of an existing app have to be sold at a price which so vastly exceeds that of the original — is it mostly due to economies of scale, difficulties of cross-system app development, or pricing shenanigans?
theodp writes: The Telegraph reports that Google Chairman Eric Schmidt has lashed out at critics of Google's complex tax avoidance tactics in the wake of news that the search giant channeled revenues through Bermuda to avoid $2 billion of global income tax levies last year. 'We pay lots of taxes,' said Schmidt. 'We pay them in the legally prescribed ways. I am very proud of the structure that we set up. We did it based on the incentives that the governments offered us to operate. It’s called capitalism. We are proudly capitalistic. I’m not confused about this.' Schmidt's stance seems to present a dilemma for tax revenue-seeking governments. Invoking Supreme Court Justice Potter Stewart's famous common sense definition of ethics ('Ethics is knowing the difference between what you have a right to do and what is right to do') is unlikely to sway a company whose Chairman sends the message that tax avoidance is the right thing to do and something to be proud of. And a Code of Conduct which requires Googlers to follow 'the letter and spirit' of doing no evil is equally unlikely to discourage tax avoidance if the Chairman suggests the practice embodies the letter and spirit of capitalism. So, to paraphrase The Sound of Music, 'How Do You Solve a Tax Problem Like Google'? Might reminding the company of another famous capitalism quote from Enron CEO Jeffery Skilling ('My job as a businessman is to be a profit center and to maximize return to the shareholders.') help spark a compromise?
theodp writes: On September 13, 2010, President Obama called A123 Systems from the Oval Office to congratulate them on opening the nation’s first manufacturing facility to mass-produce electric vehicle batteries, which the White House noted was made possible by a $249 million Recovery Act grant the company received the prior August. 'When folks lift up their hoods on the cars of the future,' the President said, 'I want them to see engines and batteries that are stamped: Made in America. And that's what you guys are helping to make happen.' But on Saturday, the assets of A123 Systems were auctioned off to the Wanxiang Group, a large Chinese auto parts maker. Wanxiang agreed to pay $256 million for A123's automotive and commercial operations, including its three factories in the United States. Forbes reports that A123's stock, which closed at 7 cents a share on Friday, is now worthless.
theodp writes: Illinois Governor Pat Quinn has launched a website and gone social on Facebook, Twitter, and YouTube to educate taxpayers on why they must make good on pension promises to state workers. And, in addition to Squeezy the Pension Python, Gov. Quinn is enlisting the help of Khan Aademy, the tax-exempt organization funded by tax-free millions from Google, Bill Gates, and others, to help convince taxpayers that a state-pension-promise-is-a-promise. In a new Khan Academy video, Illinois Pension Obligations, Sal Khan concedes that the annual annuity payouts for IL state employee retirees do look 'pretty reasonable' — e.g., $43,591 for the average teacher, $117,558 for a judge — but goes on to argue that 'in all fairness, this was promised to these people,' who he speculates 'probably took lower compensation while they were working,' 'probably stayed in the jobs longer,' and 'probably sacrificed other things' to get these 'great benefits.' But, as the press reports, tain't always so, like the Illinois school superintendent who, thanks to 'pension spiking', pocketed $1+ million in pension pay since his 'retirement' at age 57 five years ago, while also drawing a regular paycheck as superintendent of schools in California to supplement his $261,681-a-year Illinois pension. Or the two union lobbyists who substitute taught for one day to qualify for hefty pensions — over 100K, in one case. Or the employees of private organizations, including the Special Olympics, who will collect pensions through the State Universities Retirement System (six figures, in one case) because Ill. State Univ. labels them university employees. Or the Univ. of Ill. VP for business and finance, who will draw $312,000 in pension money in 2012 (to supplement a salary of $240k a year from the Univ. of Ill. Foundation), thanks to a move that got his payout computed using a more lucrative formula intended for lower-paid police officers and firefighters, putting an extra $365,000 in his pocket over the past decade. Or the pension obligations for the $620,000-a-year Univ. of Ill. President and his $195,000-a-year assistant, who were pushed from office after only two years on the job. Now these — and other tales like them — would make for a great Khan Academy Illinois Pension Obligations II video, Governor!
theodp writes: President Obama and his daughters headed to an indie bookstore last Saturday to promote shopping local. The White House did not disclose which books were bought, but author Lauren Oliver tweeted her delight after a White House photo showed her books Delirium and Pandemonium were among the 15 children's books purchased by the Obama family for Christmas gift-giving. While it made for a nice Small Business Saturday photo op, do you suppose the President paid much more for the books at the small indie bookshop than he might have at Amazon.com, where the hardcopy edition of Pandemonium is $10.15 (44% off the $17.99 list price) and the hardcopy edition of Delirium can be had for $10.47 (42% off the $17.99 list price)? Kindle Editions of the books are also available for $7.99. And with both titles eligible for free Amazon Prime shipping, the President could've saved on gasoline and Secret Service costs, too! So, will you be following the President's lead and shop local this holiday season, or is the siren song of online shopping convenience and savings too hard to resist?