Numerous CEOs have come together in an organization called Fix the Debt, a leadership council that encourages lawmakers come together and make a deal that will reduce the size of the overall debt and stabilize the economy.
The CEO Fiscal Leadership Council is made up of 63 companies, including heavy weights such as GE, Boeing, Honeywell and Goldman Sachs. In particular, they advocate changes that would “reform the tax code and cut low-priority spending,” and "keep debt under control over the long-term by focusing on the long-term growth of entitlement programs."
However, according to the Institute for Policy Studies, their ideas of change also include massive tax breaks for themselves and their corporations. They are lobbying for a “territorial tax system” which means that they would not have to pay federal taxes on any money they earned overseas and brought back into the U.S. This would amount to $134 billion bonus for these companies.
In terms of their current tax liability, the corporations have been skilled at using loopholes. As reported in the Huffington Post, Honeywell paid no taxes during the years 2008-2010, and in fact the company got tax rebates of $34 million and enjoyed a profit of $5 billion. In fact, 24 of the CEOs involved in Fix the Debt received more in personal compensation than their entire corporations paid in taxes.
The companies want the government to cut spending – but here the message is decidedly mixed. While advocating cuts in entitlement spending, Boeing has paid its lobbyists $12 million since last January to fight proposed cuts to defense and aerospace spending.
Writing in the Wall Street Journal, columnist Al Lewis comments on IPS’s study. Among his conclusions: the tax code is rigged in favor of the CEOs, thanks to years of high-paid lobbyists. For instance, CEOs can put as much money as they like into their retirement accounts. Ordinary citizens can’t contribute more than $22,000 annually to their 401(k)s. And, thanks to the tax code, the more a company pays its CEO, the less the company pays in taxes.
Fix the Debt are a bipartisan group. Two of their steering committee members are former New Hampshire Sen. Judd Gregg (R) and former Pennsylvania Gov. Ed Rendell, a Democrat. Each of them receives compensation from investment firms: Goldman Sachs and Greenhill & Co., respectively.