Connect with us

Business

ProPublica Releases Years of Data Showing Just How Little the Top 25 Richest Americans Have Paid in Taxes

Published

on

Amazon CEO Jeff Bezos, Tesla CEO Elon Musk, and former New York City Mayor Mike Bloomberg are all among the list of billionaires who have avoided paying any federal taxes for certain years, according to the outlet.


How Little the Top 25 Actually Pay

ProPublica released private tax information on Tuesday of some of the country’s wealthiest people, including Jeff Bezos, Elon Musk, Warren Buffet, and Mike Bloomberg.

The report details just how little they’ve paid in federal taxes and how they have managed to do so. 

For example, Musk, the CEO of Tesla and SpaceX, paid $68,000 in federal income taxes for 2015. For 2017, he paid $65,000. For 2018, he paid nothing. ProPublica also noted that, between 2014 and 2018, Musk’s total taxes paid amounted to only 3.27% of his personal wealth — even though his wealth during that same time period grew by nearly $14 billion. 

Meanwhile, the outlet reported that Bloomberg, a former mayor of New York City, has paid a “true tax rate” of only 1.30% compared to his wealth growth. Even slimmer than that, Amazon CEO Bezos clocked in at 0.98% and business magnate Buffet paid an ultralow 0.10%. 

Like Musk, several of those billionaires have also managed to avoid paying anything in federal taxes for certain years. For example, in 2007 and 2011, Bezos paid nothing. Neither has Bloomberg in recent years. 

“Taken together, it demolishes the cornerstone myth of the American tax system: that everyone pays their fair share and the richest Americans pay the most,” the reporters behind the ProPublica article said. “The IRS records show that the wealthiest can — perfectly legally — pay income taxes that are only a tiny fraction of the hundreds of millions, if not billions, their fortunes grow each year.”

It’s no secret that there’s a staggering divide between the country’s richest and the median American household, which earns around just $70,000 in wages a year and pays 14% in federal taxes, but ProPublica’s findings demonstrate just how extensive it can be.

By the end of 2018, the top 25 were worth $1.1 trillion. Notably, it takes the wages of 14.3 million ordinary American workers to equal that same amount, yet the top 25 only paid a total of $1.9 billion in federal taxes that year, while the ordinary workers paid $143 billion. 

How Billionaires are Avoiding Federal Taxes

As ProPublica reports, the key to how these billionaires pay so little lies in the difference between wages and total income.

For example, wages are a part of income, but just one part. Stocks, bonds, and other investments are also included in total income but are taxed at lower rates.

That’s how people like Bezos can become the richest person in the world while still only receiving a salary of $80,000 a year from Amazon. In fact, in 2018, the top 25 wealthiest Americans reported $158 million in wages, but that was just 1.1% of their total reported income. 

Instead, these billionaires retain their wealth by holding shares of companies they own. Two economists from the University of California, Berkeley have estimated that U.S. billionaires are sitting on $2.7 trillion in unrealized gains. 

Still, that begs the question: How do these billionaires actually spend money if they’re earning small salaries and hoarding massive amounts in the stock market?

According to ProPublica, the answer lies in loans. 

“The tax math provides a clear incentive for this,” reporters for the outlet said. “Take out a loan, and these days you’ll pay a single-digit interest rate and no tax; since loans must be paid back, the IRS doesn’t consider them income. Banks typically require collateral, but the wealthy have plenty of that.”

Further, those billionaires can often deduct the interest they’ve paid on loans from their taxes.

Last year, Musk pledged around 92 million Tesla shares as collateral for personal loans.

Is Publishing Private Tax Info Ethical?

As ProPublica noted, the publishing of this tax information hasn’t been without pushback.

When the outlet asked billionaire Carl Icahn whether it was appropriate that he hadn’t paid any income tax in certain years, he responded, “There’s a reason it’s called income tax. The reason is if, if you’re a poor person, a rich person, if you are Apple — if you have no income, you don’t pay taxes. Do you think a rich person should pay taxes no matter what? I don’t think it’s germane. How can you ask me that question?”

Meanwhile, a spokesperson for Bloomberg said he “pays the maximum tax rate on all federal, state, local and international taxable income as prescribed by law. Taken together, what Mike gives to charity and pays in taxes amounts to approximately 75% of his annual income.”

“The release of a private citizen’s tax returns should raise real privacy concerns regardless of political affiliation or views on tax policy…” the spokesperson added. “We intend to use all legal means at our disposal to determine which individual or government entity leaked these and ensure that they are held responsible.”

While ProPublica didn’t reveal its source, it did say that it believes “the public interest in knowing this information at this pivotal moment outweighs that legitimate concern.”

See what others are saying: (The Washington Post) (Chicago Tribune) (Associated Press)

Business

Facebook Is Reviewing More Than 2,200 Hours of Footage for Next-Gen AI 

Published

on

The project, which could prove to be revolutionary, is already raising some big privacy concerns. 


Facebook’s Next-Gen AI

Facebook announced Thursday that it has captured more than 2,200 hours of first-person video that it will use to train next-gen AI models.

The company said it aims to make the AI, called Ego4D, capable of understanding and identifying both real and virtual objects through a first-person perspective using smart glasses or VR headsets. In effect, that could potentially help users do everything from remembering where they placed forgotten items to recording others in secret. 

Facebook listed five key scenarios the project aims to tackle and gave real-world examples of how each may look for people who will eventually use the AI.

  • “What happened when?” With that scenario, Facebook gave the example, “Where did I leave my keys?”
  • “What am I likely to do next?” There, Facebook gave the example, “Wait, you’ve already added salt to this recipe.”
  • “What am I doing?” For example, “What was the main topic during class?”
  • “Who said what when?” For example, “What was the main topic during class?”
  • “Who is interacting with whom?” For example, “Help me better hear the person talking to me at this noisy restaurant.”

Facebook said the amount of footage it has collected is 20 times greater than any other data set used by the company.

Privacy Concerns

In the wake of recent controversy surrounding Facebook, it’s important to note that the footage wasn’t reaped from users. Instead, the company said it, and 13 university partners, compiled the footage from more than 700 participants around the world.

Still, that hasn’t alleviated all privacy concerns. 

In an article titled, “Facebook is researching AI systems that see, hear, and remember everything you do,” The Verge writer James Vincent said that although the project’s guidelines seem practical, “the company’s interest in this area will worry many.”

In addition to the recent testimony and data leaks from whistleblower Frances Haugen, Facebook has also faced other privacy issues, as well as billions in fines

Vincent pointe out that the AI announcement doesn’t mention anything in the way of privacy or removing data for people who may not want to be recorded.

A Facebook spokesperson later assured Vincent that privacy safeguards will be introduced to the public in the future.

“For example, before AR glasses can enhance someone’s voice, there could be a protocol in place that they follow to ask someone else’s glasses for permission, or they could limit the range of the device so it can only pick up sounds from the people with whom I am already having a conversation or who are in my immediate vicinity,” the spokesperson said.

Among positive reception, some believe the tech could be revolutionary for helping people around the house, as well as for teaching robots to more rapidly learn about their surroundings.

See what others are saying: (The Verge) (CNBC) (Axios)

Continue Reading

Business

FDA Issues Its First E-Cigarette Authorization Ever

Published

on

The authorization only applies to tobacco-flavored products, as the FDA simultaneously rejected several sweet and fruit-flavored e-cigarette cartridges. 


FDA Approves E-Cigarette

The U.S. Food and Drug Administration approved an e-cigarette pen sold under the brand name Vuse on Tuesday, as well as two tobacco-flavored cartridges that can be used with the pen.

This marks the first time the FDA has ever authorized the use of vaping products. In a news release, the agency said it made the decision because “the authorized products’ aerosols are significantly less toxic than combusted cigarettes based on available data.”

“The manufacturer’s data demonstrates its tobacco-flavored products could benefit addicted adult smokers who switch to these products — either completely or with a significant reduction in cigarette consumption — by reducing their exposure to harmful chemicals,” the agency added. 

The company that owns Vuse, R.J. Reynolds Vapor Company, also submitted several sweet and fruit-flavored pods for review; however, those were all rejected. While the FDA did not specify which flavors it rejected, it did note that it has yet to make a decision on whether to allow menthol-flavored e-cigarettes, including ones sold under Vuse.

FDA Is Reviewing All Vape Products Still on the Market

In January 2020, the FDA banned pre-filled pods with sweet and fruity flavors from being sold. While other e-cigarette related products, including some forms of flavored vapes, were allowed to stay on the market for the time being, they were only able to do so if they were submitted for FDA review.

The FDA’s primary issue with fruity cartridges stems from statistics showing that those pods more easily hook new smokers, particularly underage smokers.

In fact, in its approval of the Vuse products, the FDA said it only authorized them because it “determined that the potential benefit to smokers who switch completely or significantly reduce their cigarette use, would outweigh the risk to youth, provided the applicant follows post-marketing requirements aimed at reducing youth exposure and access to the products.”

While some have cheered the FDA’s decision, not everyone was enthusiastic. Many critics cited a joint FDA-CDC study in which nearly 11% of teens who said they vape also indicated regularly using Vuse products. 

See what others are saying: (Business Insider) (Wall Street Journal) (The Washington Post)

Continue Reading

Business

Kaiser Permanente Health Workers Vote To Authorize Strike Over Pay, Staffing, and Safety

Published

on

The vote could inspire unioned Kaiser workers in other states to eventually approve strikes of their own. 


Workers Approve Strike

Over 24,000 unioned nurses and other healthcare workers at Kaiser Permanente hospitals voted Monday to authorize strikes against the company in California and Oregon.

The tens of thousands of workers who cast a ballot make up 86% of the Kaiser-based healthcare professionals represented by either the United Nurses Associations of California/Union of Health Care Professionals (UNAC/UHCP) or the Oregon Federation of Nurses and Health Professionals. An overwhelming 96% voted to approve the strike.

According to both unions, the list of workers includes nurses, pharmacists, midwives, and physical therapists.

The vote itself does not automatically initiate a strike; rather, it gives the unions the power to call a strike amid stalled contract negotiations between Kaiser and the unions. If the unions ultimately tell their members to begin striking, they will need to give a 10-day warning. 

The California and Oregon contracts expired Sep. 30, but several more Kaiser-based union contracts are rapidly approaching their expiration dates as well. That includes contracts for more than 50,000 workers in Colorado, Georgia, Hawaii, Maryland, Virginia, Washington state, and D.C. Notably, the demands from those workers echo many of the demands made by California and Oregon’s union members. 

The Demands 

At the center of this potential strike are three issues: staffing problems, safety concerns, and proposed revisions to Kaiser’s payment system. For months, nurses have been publicly complaining about long shifts spurred by the COVID-19 pandemic, staffing shortages, and an over-reliance on contract nurses.

Because of that, they’re seeking to force Kaiser to commit to hiring more staff, as well as boost retention.

But the main catalyst for any looming strikes is pay. According to UNAC/UHCP, Kaiser wants to implement a two-tier payment system, which would decrease earnings by 26% to 39% for employees hired from 2023 onward. On top of that, those new employees would see fewer health protections.

The unions and their members worry such a system could lead to an increased feeling of resentment among workers since they would be paid different rates for performing the same job. They also worry it could exacerbate retention and hiring issues already faced by the hospital system. 

Additionally, the workers want to secure 4% raises for each of the next three years, but Kaiser’s currently only willing to give 1%, citing a need to reduce labor costs to remain competitive.

See what others are saying: (Los Angeles Times) (The Washington Post) (KTLA)

Continue Reading