Caterpillar: Just Your Modern Job Creators

Sunday’s New York Times has a twist on the “privatize gains, socialize losses” meme we lefties often harp on about: privatize gains, socialize costs.

States like North Carolina, in the hopes of luring jobs from corporate giants like Caterpillar, are paying to train workers in the often-times narrow skills specific to Caterpillar’s needs.

The Times writes:

Yet North Carolina is picking up much of the cost. It is paying about $1 million to help nearly 400 workers acquire these skills, and a community college has committed to develop a custom curriculum that Caterpillar has valued at about $4.3 million.

Caterpillar is one of dozens of companies, many with growing profits and large cash reserves, that have come to expect such largess from states in return for creating jobs. The labor market is finally starting to show some signs of improvement, with the government reporting on Friday that employers created 200,000 jobs in December.

Although the sums spent on training are usually small compared with the tax breaks and other credits doled out by states, some critics question the tactic.

“The question is, why shouldn’t the company pay for this training?” asked Ross Eisenbrey, the vice president of the liberal Economic Policy Institute. “It’s for their benefit.”

Yes, that is a good question. Why doesn’t Caterpillar pay to train its own workers? Time was, employee training was part of the deal. Not any more. Desperate times call for desperate measures, apparently; when unemployment is high, employers can set their own terms. That means generous incentives — the Times story says Caterpillar got a $51 million package from North Carolina — all in the hopes of luring an employer. Kinda makes you wonder who’s really paying for all of this “job creating,” hmmm?

And honestly, I almost wouldn’t mind this so much, were it not for corporations like Caterpillar pissing and moaning about their gawd-awful tax burden all the time — yes, even as they get handed a trained workforce on a silver platter and tax credits and everything else, they’re still pulling shit like this:

Caterpillar Inc. used offshore subsidiaries in Switzerland and Bermuda to avoid about $2 billion in U.S. taxes from 2000 to 2009, boosting its earnings through a “tax and financial statement fraud,” according to a Caterpillar executive’s lawsuit.

The company, the world’s largest construction-equipment maker, sold and shipped spare parts globally from an Illinois warehouse while improperly attributing at least $5.6 billion of profits from those sales to a unit in Geneva, according to the suit filed by Daniel J. Schlicksup. He was a global tax strategy manager for Caterpillar from 2005 to 2008.

And this:

CHICAGO (Dow Jones)–Caterpillar Inc. (CAT) remains highly critical of Illinois’s business climate, despite state lawmakers’ approval of a series of business tax breaks this week that includes tax credits for research and development investments sought by Caterpillar.

A spokesman for the construction machinery manufacturer called the extension of the R&D credits a “small step in the right direction,” after the state allowed the credit program to expire at the end of the 2010. But Caterpillar characterized the package of business tax breaks as largely a knee-jerk reaction to threats by companies to leave the state. Caterpillar said the legislation does little to improve a state fiscal condition that the Peoria, Ill., company considers unappealing for business investment.

“From a financial standpoint, Illinois is a patient in critical condition,” said spokesman Jim Dugan. State government “continues to react in crisis mode, using band-aids rather than developing a long-term plan to get the state on the road to being healthy.”

The business tax breaks are expected to cost the state $214 million a year by 2014, according to state estimates. Illinois is facing budget deficits and massive pension costs for state employees in the coming years that threaten to force legislators to consider additional increases in state income taxes.

And Caterpillar “starving the beast” of $214 million helps how, exactly?

Corporations like Caterpillar are the worst offenders because they’re exploiting a jobs crisis they created by outsourcing jobs overseas, while at the same time dodging their tax obligation through fraud, tax shelters and strong-arm “negotiation” tactics. They’re getting all of the benefits of operating in the United States without paying their fair share, threatening to “go Galt” and all that crap because they know they’ve got us between a rock and a hard place. You know what? Fuck you, then. Go. You don’t like this country? Leave. Go move your HQ to someplace else, if you don’t think we’re a nation worth investing in. Go wave someone else’s flag, then.

I mean, seriously. Look what they’re doing to their workers up in Canada, demanding a 50% pay cut, no cost of living adjustment, changes to the healthcare co-pay. The union said no and Caterpillar locked them out. That’s some serious hardball. So wise up: are we this desperate for jobs that we’ll cut a deal with the devil? Apparently, yes.

Such is the American dilemma in these days of high unemployment. But corporations need to remember that times change. They won’t always be on top. We’ll muddle through this crisis and, God help us, when we emerge on the other side, let’s not forget how Our Corporate Overlords treated this country and its workforce in its time of need. Let’s not forget how they starved the public of the tax money it needs to make this country a place worth living and working in. Let’s not forget that while cheating on their taxes, they acted like Mafia bosses, demanding ever more from We The People or else. We pay for the training and the tax abatemenss, or the workforce gets it.

And pray let us not forget how at the same time, they spent millions on lobbying, hoping to stack the deck ever more in their favor. Oh yeah, and let’s not forget the sorry “poor me” song they sang, while they netted $2.7 billion in profits off of $42.6 billion in revenue.

We took these deals because we were hungry. But we won’t be hungry forever. Things change. The world changes. Some day they’ll be on the losing side of some trend, or some awful shift in technology. They are going to demand Uncle Sam bail their sorry asses out for some stupid mistakes that were made, and God help us, let us not forget this moment in time.

Let us hope the Memory Hole is there to remind us.


Filed under corporations, taxes

19 responses to “Caterpillar: Just Your Modern Job Creators

  1. Frank Simpson

    Yeah, I had the same thought when I read the article this morning. Half of my working career was at Caterpillar—back in the day. They had extensive apprentice training programs to recruit and train the workers. It was part of the corporate culture. Of course, that culture started to disappear around 1980…and I left in 1985.

    • WTF happened? EVERY corporation had extensive apprentice training programs, management training programs, you name it. Now it’s all, “fuck it! Let the state pay!”


  2. Mike G

    They are going to demand Uncle Sam bail their sorry asses out for some stupid mistakes that were made, and God help us, let us not forget this moment in time.

    Caterpillar and other big corporates know they can always find enough whores in Congress to do their bidding, no matter how much they screw the public.

  3. States have been picking up the training costs for a long time. Back in the 80s when GM built the Saturn plant in Spring Hill, state money paid for the development of thousands of hours of training. It was part of the package of deals the state kicked in to get GM to pick here.

  4. Randy

    “Some day they’ll be on the losing side of some trend, or some awful shift in technology. They are going to demand Uncle Sam bail their sorry asses out for some stupid mistakes that were made, and God help us, let us not forget this moment in time.”

    Amen Sister.

  5. Jim

    Some day they’ll be on the losing side of some trend, or some awful shift in technology. They are going to demand Uncle Sam bail their sorry asses out for some stupid mistakes that were made, and God help us, the government will do it. For example see big banks and GM.

    • For example see big banks and GM.

      Yes and let us hope never again. Of course, they’ve all paid that money back, and the auto bailout saved thousands of jobs at a time when we could ill afford to lose them. In crisis times decision-making comes down to choosing among a variety of equally bad options.

      But corporations sucking at the governmen teet is nothing new, either. See how our U.S. military waged an expensive war so ExxonMobil can have access to Iraq oil contracts.

      And that just adds to my contempt for corporate America. After ALL WE’VE DONE FOR THEM they still refuse to pay their taxes and uses extortionist techniques to threaten states and unions and spend millions of dollars buying off politicians and forming stupid faux-grassroots organizations so they can further stack the deck in their favor. When is it enough? Their CEOs fly around the world in Lear Jets and have 5 and 6 homes and their wives waltz around in furs and diamonds, while everyone else starves? Will it be enough then?


      • Jim

        The banks have paid back the TARP loans for the most part (I think). GM – not so much –

      • OMG. Shikha Dalmia is right wing hack, one of those Libertarian loons over at Reason who has been against the GM bailout from the beginning, as well as against everything Obama has ever said or done, including brushing his teeth in the morning. Hardly a credible or unbiased source.

        GM repaid its loan. The taxpayers have not yet recouped their investment. These are different things. GM stock will have to double for that to happen, and yes there are issues with GM’s pension plan. GM is hardly the only comoany in America with that issue, BTW. But guess what, GM reclaimed its mantle as the world’s largest automaker in 2011, so I’m sure these issues will be resolved as the economy strengthens — Dalmia’s shrieking about Socialism notwithstanding. And guess what, tens of thousands of people didn’t lose their jobs. Shikha Dalmia can STFU.

        She’s wasted far too much bandwidth on her theories about why GM will never EVER be a car manufacturing leader again and how Obamacare is totally the worst thing to happen to America EVER and her other “but the free hand of the market is awesome” crap. Funny, GM is recording a profit for the first time in years and they’re even outselling Toyota in China, the world’s largest car market. GM has remained the world’s largest automaker which really must frost Shikha Dalmia because it means she was wrong and THAT CAN’T HAPPEN.

        God. Please don’t come over here with your Libertarian crap because I WILL NOT HAVE IT. Free hand of the market my ass.

      • Jim

        SB – GM paid the “loan” portion of their government handout with more government handouts. I don’t see how that is repaying the loan. The other 40 something million was just a gift as GM’s stock has never been valued high enough to pay back the “investment” made by the government.

        But in the end, I was agreeing with your original post that the government should not be bailing out private industry in the future.

      • Er, not exactly. They used the escrow account the government set up in exchange for our 61% share of the company. You can call that a “handout” if you want but it’s not really a handout when the government has actually BOUGHT 61% of your company. We can debate the wisdom of such an act, and we’d probably agree, but let’s at least get the semantics straight.

        And how come no one ever talks about Bush’s emergency “handouts” to GM and Chrysler, too? Everyone seems to conveniently forget that TARP was Bush’s deal.

        What’s really sad is how much conservatives have invested in seeing Obama fail, to the point where even something that should be construed as good news is torn apart and the truth stretched. Because GOD FORBID y’all would ever admit that a Democrat did something right. Kinda like when y’all cheered when Chicago didn’t get the Olympic Games. You know, something that would have been good for America, to host the Olympic Games and all but NO! Now it’s a bad thing ‘cuz Obama was for it! Such good patriotic people, your lot. Pffft.

      • Jim

        You know, something that would have been good for America, to host the Olympic Games and all but NO! – This is changing subjects, but the last couple of Olympic Games have not been the boom to the economy that the host countries were hoping for. I haven’t checked lately, but London was struggling to get things ready for 2012 I thought.

      • This is changing subjects, but the last couple of Olympic Games have not been the boom to the economy …

        Oh right and THAT’S why all the right wingers cheered when Chicago didn’t get the Olympics. Yeah, that’s it, sure! Not the Obama Derangement Syndrome that has completely overtaken every conservative Rush Limbaugh loving red-blooded American, who suddenly finds it in their patriotic duty to cheer against the home team.

        Jesus fucking Christ, already. So you’re saying Mittster’s big accomplishment wasn’t so swuft after all? Taking over the Salt Lake Olympics was a fail? I’ll let the RNC know.

        Anyway, there are other benefits besides the direct ones. For example, a 30% increase in trade. Or, you know, just sending the “brand” around the world. But whatever. You’re the definition of a Debbie Downer. Just go take some fucking happy pills, already.

        And yeah, it’s off topic, like the whole GM bailout convo we just had. Amazing. Everything you say over here is off topic, Jim. Nice of you to notice.

      • Jim

        The GM bailout is off topic when you complain about the government giving money to corporations? Ok whatever.

        And sure the Republicans want Obama to look bad. They want to win the next presidential election and it is their belief that Obama’s proposals are bad for America. If you thought something was bad for America would you be supporting it?

      • Jim

        Form your qouted 30% study: ” Interestingly however, we also find that unsuccessful bids to host the Olympics have a similar positive impact on exports. We conclude that the Olympic effect on trade is attributable to the signal a country sends when bidding to host the games, rather than the act of actually holding a mega-event. “

      • Jesus Christ, Jim. You’re such a fucking moron. That’s not even the goddamned point. The point is that the right wing assholes that you are constantly over here defending CHEERED AGAINST AMERICA BECAUSE THAT’S HOW MUCH THEY HATE THE PRESIDENT.

        Are you ACTUALLY trying to pretend that they were cheering because they are oh so fiscally responsible that they just KNEW it would be a drain on taxpayers? Really? You think I’m that stupid to buy this revisionist history BS? That is beyond insulting to my intelligence.

        I am sick to death of the stupid crap you spread over here. Your Teanut friends may buy that crap but I sure don’t. No one with a brain does.

  6. Min

    I can’t tell who’s the bigger wh*re in this scenario, Caterpillar or North Carolina.

  7. I’m still hoping that someday the SLC Morons will get pissed enough at Apostate Mitt to out him for whatever rewards he reaped from Olympics that were held there. The IOC and its U.S. counterpart are both snake pits and throwing one more viper into the mix could not have diluted its toxicity.

  8. Jeez, I almost forgot, fuck fucking Caterpillar management, those fucking fuckers.