Center for Business and Economic Research - Ball State University


CBER Data Center
Projects and
Publications
Economic
Indicators
Weekly
Commentary
County
Profiles
Community
Asset Inventory
Brownfield Grant
Writers' Toolbox
Manufacturing
Scorecard

About

Commentaries are published weekly and distributed through the Indianapolis Business Journal and many other print and online publications. Disclaimer

RSS Feed

Disclaimer

The views expressed in these commentaries do not reflect those of Ball State University or the Center for Business and Economic Research.

Recent

Teacher Pay Is the Symptom of Deeper ProblemsState spending per Hoosier student is down more than 7.0 percent since 2010.

Questions from an Economic ForecastThe economic recovery is in the hands of vaccine distributors, not economic policymakers.

Stop Restricting Indianapolis GrowthIn the 21st century, a full 85 percent of the state’s population growth happened within the Indianapolis metro area.

Indiana’s Lagging Educational AttainmentFinancial security without a college degree is possible but not probable.

View archives

Top Tags

jobs and employment 196
economics 162
economic development 120
taxes 117
education 116
finance 102
recession 91
budget and spending 72
state and local government 71
unemployment and the labor market 71
Browse all tags
Reporter / Admin Login

October 17, 2011

Maybe the Occupy Indianapolis Crowd Is on to Something

I spent last weekend at an economic research conference in Indianapolis. It was hosted by Ball State University, Indiana University and Purdue University. The conference showed our state in great light. We continue to live in interesting times so we economists had much to discuss. Among the topics was the small ‘Occupy Indianapolis’ protest that greeted us on our opening day.  I can report that the crowd looked orderly and unremarkable. I mean this as a real compliment, for much of the coverage that these protests have received exposes an honest kookiness to their movement.  As an example, among the protesters’ early demands was that tariffs should be introduced to prevent the free movement of goods across borders, while workers should be permitted to move without interruption across those same borders.  One need not be too clever to understand that preventing rice from crossing borders, but letting hungry people do so is recipe for worldwide hardship and disaster.  But, to be fair, focusing on the crazy elements of any political movement is cheap theater.  I think there’s something in the Occupy Indianapolis protest for most of us to appreciate.  Among these is the real and persistent influence, from both corporations and unions that distorts our tax system.  The reality is astonishing.   

General Electric makes good products, hires good workers and makes a tidy profit.  In 2010, they paid a dividend, which is good of course because it reflects returns on investment.  However, in 2010, GE paid no federal taxes.  So, last year, an American company—one whom we should all like and respect, whose capitalization was north of $170 billion with $14 billion in profits—paid no federal corporate income taxes.  However, according to the Center for Responsive Politics, so far in 2011 General Electric has spent more than $15 million lobbying Congress and has 174 lobbyists working on tax and regulatory issues.  They spend tens of millions more on lawyers and accountants figuring out how to exploit or change the tax system to avoid taxes.  This is a waste of talent and a symptom of the failure of our politics.

In 2010, every public university in Indiana paid more in federal income tax than did General Electric.  In Bloomington, West Lafayette and Muncie, campus administrators fill vacant dorms throughout the summer with conferences hosting musicians, Methodists, mathematicians and the like.  The fees cut the cost of running a campus, but, according to the Internal Revenue Service, it is considered “Unrelated Business Income” and therefore taxable. 

A highly profitable GE pays no taxes, but state universities do. Is this not dumbfounding and morally questionable? The federal tax system is simply and plainly broke.  If the Occupy Indianapolis folks want to help fix it, then they can count on me, but to do so they are going to have to lose some of the crazies.  Moreover, they are going to have to make sure that they are not infiltrated by unions, who do the same unprintable thing to taxpayers as does GE.   

Link to this commentary: https://commentaries.cberdata.org/592/maybe-the-occupy-indianapolis-crowd-is-on-to-something

Tags: economy, taxes


About the Author

Michael Hicks cberdirector@bsu.edu

Michael J. Hicks, PhD, is the director of the Center for Business and Economic Research and the George and Frances Ball distinguished professor of economics in the Miller College of Business at Ball State University. Hicks earned doctoral and master’s degrees in economics from the University of Tennessee and a bachelor’s degree in economics from Virginia Military Institute. He has authored two books and more than 60 scholarly works focusing on state and local public policy, including tax and expenditure policy and the impact of Wal-Mart on local economies.

© Center for Business and Economic Research, Ball State University

About Ball State CBER Data Center

Ball State CBER Data Center is one-stop shop for economic data including demographics, education, health, and social capital. Our easy-to-use, visual web tools offer data collection and analysis for grant writers, economic developers, policy makers, and the general public.

Ball State CBER Data Center (cberdata.org) is a product of the Center for Business and Economic Research at Ball State University. CBER's mission is to conduct relevant and timely public policy research on a wide range of economic issues affecting the state and nation. Learn more.

Terms of Service

Center for Business and Economic Research

Ball State University • Whitinger Business Building, room 149
2000 W. University Ave.
Muncie, IN 47306-0360
Phone:
765-285-5926
Email:
cber@bsu.edu
Website:
www.bsu.edu/cber
Facebook:
www.facebook.com/BallStateCBER
Twitter:
www.twitter.com/BallStateCBER
Close