What the story? Last year Verizon made $12 billion in profits, got $1 billion in government subsidies and paid zippo, zero in taxes. But instead of sharing this windfall with the working people who make the company successful, Verizon has the audacity to demand their workers take pay and benefit cuts of $20,000 a year. This at the same time that Verizon’s four top executives have pocketed over $258 million (a quarter of a billion) in the past four years, which is obscene.
Fortunately, on August 6, the 45,000 unionized Verizon workers used the most potent tool management understands: the strike! In going on strike, they’re setting a needed example to corporate management all over America, including the multinationals. And I am writing this article as a Verizon customer of both telephone and DSL/Internet services. The message: I don’t want to see these workers fail. It will give corporate management the misguided idea they can take taxpayer money, pay no federal taxes, while taking away income and benefits from their employees.
That’s a bad habit U.S. corporations have gotten into: asking taxpayers to socialize their bailouts, while they privatize their profits for the biggest earners in their company. It needs to be stopped and Verizon is a good place to start. Their gang of four at the top should learn that the American Dream is not just for them, but for the 45,000 people out there working for them every day.
Yet, when I called the number, 1–800–837–4966, that MoveOn.org gave me to complain as a customer to Verizon, a prerecorded voice said that “service might be hampered due to a strike.” So, it was the strikers’ fault that Verizon couldn’t provide me with someone to ask about their company’s behavior? Not.
Let me put this to you another way. Despite earning over $32.5 billion over the last three years, Verizon paid not a penny in corporate income taxes but actually received $1 billion (the same amount as the concessions sought from workers) in tax benefits from the federal government during that time. Frankly, if Verizon thinks its workers should pay another billion for their management’s benefits, I, as a taxpayer and customer, think that Verizon should return a portion of the handouts it receives from the federal government at some point in the future.
In fact, if fact Verizon paid its corporate income tax at the official rate of 35 percent, it would have owed more than $11 billion (rather than negative $1 billion). So this is another ship taxpayers now pay to keep afloat. This billion would have been enough to avoid the recent debt deal cuts to student loan programs.
Yet, doggedly, Verizon has disputed the claim that it doesn’t pay enough in taxes. Their math unfortunately is misleading because it includes taxes that they will owe in the future, not those they really pay in a given year.
In fact, Verizon’s tax dodging is now so infamous that it has become one of the primary targets of US Uncut, a grassroots organization dedicated to getting delinquent corporations to pay their fair share.
The Communication Workers of America (CWA) that is leading the strike, along with the International Brotherhood of Electrical Workers (IBEW), also notes that while calling for a benefit cut from workers, the top five executives at Verizon received more than a quarter of a billion dollars in compensation over the last 4 years. No wonder no one is answering the phone at Verizon.
In fact, this weekend I saw Verizon workers lined up outside their stores with placards in their hands, asking for your support and mine, I beeped my horn twice and shouted out to them “hang in, guys” assuming all of us working and retired people are going to stand with these 45,000 union folks. Let’s not have the Wisconsin municipal workers’ debacle over again in the private sector.
But given Verizon’s record on taxes and compensation, it’s hard to believe they will come around to being a good corporate citizen (and taxpayer) anytime soon. Yet unions and the public, meaning you, I, and everybody else, need to keep up the pressure by asking Verizon the billion dollar question: Can you hear us now?
Hopefully, Verizon’s policy pushers, lobbyists and regulators, whose tab adds up to millions of dollars each year, won’t bail them out one more time. Clearly, Verizon wouldn’t keep us on the line if we, their consumers, didn’t pay our bills. Unfortunately, Verizon’s broad interests on Capitol Hill have been equaled by an even greater effort to use the political and regulatory process to maximize profits and minimize liability.
Over the past 10 years, Verizon’s PAC and employees have given $12 million in federal campaign contributions, with $1.1 million of that going to members of the relevant tax-writing committee. Is that legal? Also, Verizon lobbyists have been very active: Verizon has spent $131 million on their efforts in the same time frame.
Verizon first got itself in trouble as a subject of congressional outrage when it exploited a tax loophole to sell 4.8 million rural phone lines at a profit, while avoiding $600 million in taxes. And in 2010, the company paid nothing, as noted, in federal income taxes on $12 billion in profits. Maybe some folks at the top of the well-paid heap need to take a vacation in orange jumpsuits. It’s always a sobering thought for those who consider themselves above, beyond, invulnerable to the laws that the rest of us are pressed to observe and do. I do hope that comes in loud and clear.
Jerry Mazza is a freelance writer, life-long resident of New York City. An EBook version of his book of poems “State Of Shock,” on 9/11 and its after effects is now available at Amazon.com and Barnesandnoble.com. He has also written hundreds of articles on politics and government as Associate Editor of Intrepid Report (formerly Online Journal). Reach him at firstname.lastname@example.org.