The company I work for is BIG! But not BIG like Apple. Apple is HUGE like a watermelon and a watermelon looks great on my iPad. When I think of Apple, I think of money. Lots and lots of money. Tim Cook, their CEO…is smert!
I have actually met with Tim Cook twice. But this was before Tim Cook was CEO. This was when he was still making fruit smoothies for his boss. But then his boss died. Now Tim has his own lunch made for him by someone else. I hear he likes sandwiches. But how would I know? He never calls. Never writes. What’s a boy to do? Anyway, he was a nice guy when I met him; mildly spoken and well balanced. Sure, Steve Jobs may have had the vision, but Tim Cook was the operations expert that brought the vision to reality in my humble opinion.
Today Tim goes before the Senate’s Permanent Subcommittee on Investigations to answer questions from Democratic Senator Carl Levin and Republican Maverick John McCain regarding the tens of billions of dollars in offshore accounts and tax shelters that Apple protects.
I love these hearings. I watch them on C-SPAN. I love Senator Levin because he always seems surprised and frustrated that people/companies under investigation are able to get away with what they are doing as a result of him and his colleagues voting for or against potential laws that would stop the abuse. And then there’s Ol’ Huff n Puff McCain who always votes with the right, until something goes wrong, and then sides with the left. Not much of a Maverick in my mind. I think that’s called a flip flopper or flap banger, or a banger n mash.
Let’s save ourselves some time. No need to tune in today. Here’s how I see it going down after the greetings and salutations. There are three men at play. Levin, disheveled, holding up papers with his reading glasses at the end of his nose, and McCain pretending to ask hard questions but really throwing softballs because he owns Apple stock and doesn’t want to see the price come down, and Tim Cook, who I like very much, representing not only Apple, but Capitalism, in a measured yet polite and accommodating voice. But in this version, he is a little more candid with the truth.
Senator Levin: Mr. Cook, thanks for attending. Let’s get right down to it. Apple has tens of billions of dollars in offshore accounts all over the world, correct?
Tim Cook: Yes, that’s correct.
Senator Levin: Further, it sounds as if you’ve taken that model a step further and have created not just offshore accounts, but offshore businesses in which you vest your money in those businesses, yet you don’t have anyone working in those businesses, but you appoint a person in charge of that business and they maintain the business from Cupertino California, Apple’s base of operations.
Tim Cook: Yes, that too is correct.
Senator Levin: And there’s one instance in which you are doing this in Ireland…to the tune of $30 billion. Is that right?
Tim Cook: Yes. Correct. And elsewhere. We’ve actually created our own country off the coast of the Maldives. It’s called Jobslandia and will be voted into the UN next year, we hope. Not much there. Just a wireless router and very large safe.
Senator Levin: Well (frustrated already, he removes his glasses) why are you doing that?
Tim Cook: Senator, we take such measures with our money to avoid paying corporate taxes.
Senator Levin: Yes, I know, but why are you being so elaborate?
Tim Cook: We’re Apple. We’re smart. We’re engineers. We’re always looking to improve the ways we do business.
Senator Levin: Even if that means creating new ways to hide your money?
Tim Cook: Absolutely. We’re actually hoping to have our own currency one day so we won’t have to pay ANY taxes to anyone, ever again.
Senator Levin: Don’t you think it’s bad that you’re avoiding paying taxes, Mr. Cook?
Senator Levin: Yes, bad. Don’t you feel a moral obligation to pay your taxes?
Tim Cook: (Smirks) Senator, we use child labor in China to make our iPads for seventeen-cents a day. The very symbol of our company, the Apple, represents forbidden things. No. I don’t feel a moral obligation to pay taxes.
Senator Levin: Well you should!
Tim Cook: With respect Senator, nothing we are doing is illegal. In business, big business particularly, when thousands of people become millionaires just by owning our stock, including members of the Senate who are in this room today…there is no right or wrong. Just legal and illegal. With respect to the committee, if the US Government believes large corporations should be morally obligated to pay taxes, then the US Government should pass laws that would make it so.
Senator Levin: But you big business guys make it hard for us to pass laws that would make you pay your taxes.
Tim Cook: We absolutely do, Senator. As a company, if I make $10 Million this year, I would rather pay $4 Million of that to a SuperPact to re-elect a Senator who will vote against any laws that make us pay our taxes, than spend the $3 million in corporate tax. Why? Because the $4 Million is a tax deduction according to the SuperPact laws, which came out of this very Senate. In essence, I MAKE money while trying to avoid taxes. It’s a double win.
Senator Levin: I’m sick of this!!! (About to blow a gasket, Levin gives up and looks over to McCain).
Maverick: Mr. Cook, I am going to jump in here. I think what my friend and colleague Senator Levin is getting at, is…well…we want to pass new laws to make corporations like yours pay your taxes. BUT we don’t have any leverage to pass laws to make you pay your taxes because, well, we’ve all being bought lock stock n’ barrel by corporations like yours. My left arm, for example, the one that doesn’t work well, actually belongs to Exxon Mobile, and because that’s the one I vote with, it has been pre-programmed to vote NO on any law promoting clean air, alternative energy, or drinkable water. Of course, as a nation, we’re broke, because we as Senators have sacrificed our obligation to our constituents in favor of campaign money to get re-elected so that we can be here, with you, talking about business. See…a little secret of Washington is this…politicians aren’t very smart when it comes to business. We became politicians because all of us want the respect of men like yourself, but none of us can add or subtract and collectively we think ROI stands for Respect Our Incumbents. So, in short, we all have little man-boners for guys like you.
Tim Cook: Is that a question, Senator?
Maverick: Sorry. I got carried away there. My question is this…Mr. Cook, what would you suggest we do?
Tim Cook: Senator, that sounds like conflict of interest if you’re asking me for advice on what you should do to make me pay more taxes. But, this is Washington so I will give it a shot. Ready? I think you should pass laws to make companies like mine pay taxes. End of story. Cut and dry. That is it.
Senator Levin: But we can’t pass laws because of the lobbyists.
Maverick: Yeah, my left arm has been pre-programmed to support the lobbyists, remember?
Tim Cook: So pass laws that limit the influence of the lobbyists.
Senator Levin & Maverick Together: Then we won’t get re-elected!
Tim Cook: Am I on candid camera? (Looking around).
Senator Levin: Look, I’m more concerned about companies doing the right thing. I’m not a businessman, and I’m a democrat, so I say pish posh when it comes to the P&L, and I just want to know that guys like you are doing the right thing morally. So, if we cannot force you to pay taxes, which I do think is a moral issue, can you guys be a little more moral in general?
Tim Cook: Yeah, you could pass laws that would make my use of child labor in China to make iPads, illegal. Maybe it would force me to bring manufacturing stateside.
Senator Levin: That’s a great idea! But…wait, will the Apple stock price go down?
Tim Cook: Absolutely. The Apple stock price will go down dramatically as our margins will shrink. But it would be the right thing to do…
Senator Levin: Well, let’s not get overly dramatic! I mean…I have stock in Apple and I really don’t see anything wrong with those Chinese kids learning the value of hard work at such a young age.
Tim Cook: Me neither.
(A long pause ensues between all three men. It’s awkward. A stalemate has been reached).
Maverick: Well, that about wraps up the hearing today. Mr. Cook, I’d like to thank you for coming in and allowing us to do this dog and pony show. No change will come of out this hearing, as nothing ever does, but we surely have enjoyed our man-boners wondering what’s it’s like to run an organization that gets stuff done and makes all of the Senators who hold Apple stock, including myself, more money with every iPad sold. As they’ll say in the nightly news tonight…we tried. And because we’re voted into our jobs, that’s all we really need to do…is try. Meeting adjourned.
Folks, did you pay your taxes this year?
I sure did.
And this is how they were spent today.