Bernie Sanders' 2012 Report on 18 CEOs, Tax Refunds and Bailouts

Photo credit as first published: Breitbart.com

In October 2012 Senator Bernie Sanders of Vermont published a short report called “Top Corporate Tax Dodgers.” It named 18 chief executives who had backed a high-profile call for deficit reduction, and set out what their companies had paid in federal income tax, how much help they had received during the 2008 financial crisis and how many jobs they had moved abroad. His point was blunt: business leaders asking Congress to trim Social Security and Medicare ran firms that, by his count, had contributed to the deficit themselves.

Below you will find who the CEOs were, the figures the report gave for each company, where those numbers came from and how to read them fairly, since several are easy to misunderstand.

The quick answer: what the report said

The report opened with a few headline totals for the group of companies it examined:

• more than 600 subsidiaries set up in the Cayman Islands and other low-tax jurisdictions since 2008;
• at least $34.5 billion in taxes avoided through those offshore arrangements;
• a dozen companies that paid no federal corporate income tax in at least one year after 2008, while collecting more than $6.4 billion in refunds from the IRS;
• combined crisis support of more than $2.5 trillion from the Federal Reserve and the Treasury for the banks and industrial firms on the list;
• hundreds of thousands of American jobs sent to China and other lower-wage countries.

Sanders paired these numbers with a pointed statement. He opened it with five words, “There really is no shame,” and went on to argue that the people asking ordinary Americans for sacrifice should first support closing corporate loopholes and taxing the wealthy more.

Why Sanders published it: the Fix the Debt campaign

The report was a reply to the Campaign to Fix the Debt, a group of executives and former lawmakers founded in July 2012 by Erskine Bowles and former senator Alan Simpson. The two had led President Obama’s deficit commission, and their campaign pushed Congress toward a Simpson-Bowles style package of spending cuts, entitlement reform and tax reform ahead of the “fiscal cliff” at the end of 2012. Former senator Judd Gregg and former Pennsylvania governor Ed Rendell later served as its co-chairs.

In October 2012 dozens of CEOs from the campaign’s CEO Council signed a statement, promoted in the Wall Street Journal, urging Washington to act on the deficit. Within weeks, more than 100 business leaders had signed on, and by November the CEO Council counted around 150 executives. Critics noticed that the group wanted savings from Social Security and Medicare while staying quiet about defense spending and corporate tax breaks. Sanders’ report was one of the sharpest of those responses.

The 18 CEOs and the figures for their companies

Here are the executives the report named, in its own order, with the company figures it gave. “Tax refund” means the company reported no federal income tax for the year shown and received money back. “Offshore estimate” is the report’s calculation of extra federal tax the company would have owed if profits held abroad were taxed in the US.

CEO and company	What the report said
1. Brian Moynihan, Bank of America	No federal income tax for 2010, $1.9 billion refund. More than $1.3 trillion in Fed loans plus a $45 billion Treasury bailout. Offshore estimate: $2.6 billion.
2. Lloyd Blankfein, Goldman Sachs	No federal income tax for 2008, $278 million refund. $824 billion in Fed and Treasury support. Offshore estimate: $2.7 billion.
3. James Dimon, JPMorgan Chase	$416 billion in Fed and Treasury support. Offshore estimate: $4.9 billion.
4. Jeffrey Immelt, General Electric	No federal income tax for 2010, $3.3 billion refund. $16 billion in Fed assistance. About 25,000 jobs added overseas since 2001.
5. Lowell McAdam, Verizon	No federal income tax for 2010, $705 million refund. 13,000 job cuts announced in 2010.
6. James McNerney Jr., Boeing	No federal income tax for 2010, $124 million refund. More than 57,000 jobs lost to outsourcing or imports since 1994. At least $58 billion in Export-Import Bank loans and guarantees.
7. Steve Ballmer, Microsoft	Offshore estimate: $19.4 billion.
8. David Cote, Honeywell	No federal income tax for 2008 to 2010, $34 million refund.
9. Wendell Weeks, Corning	No federal income tax for 2008 to 2010, $4 million refund.
10. Glenn Britt, Time Warner Cable	No federal income tax for 2008, $74 million refund.
11. Kenneth Frazier, Merck	No federal income tax for 2009, $55 million refund.
12. Samuel Allen, Deere & Company	No federal income tax for 2009, $1 million refund.
13. Brian Duperreault, Marsh & McLennan	$90 million refund for 2010; 105 subsidiaries in places the report called tax havens.
14. Paul Jacobs, Qualcomm	Offshore estimate: $4.7 billion.
15. Gregg Sherrill, Tenneco	Offshore estimate: $269 million.
16. George Paz, Express Scripts	Offshore estimate: $20 million.
17. Gary Loveman, Caesars Entertainment	Offshore estimate: $9 million.
18. Thomas Quinlan III, R.R. Donnelley & Sons	No federal income tax for 2008, $49 million refund.

Two small corrections to versions of this list that circulated online: the printing company is spelled Donnelley, and the Tenneco chief executive’s surname is Sherrill.

How to read the numbers fairly

The figures are real numbers taken from company filings and government data, but they measure different things, and mixing them up leads to wrong conclusions.

Different years for different firms

The report picked specific years, from 2008 to 2011, for each company. A firm that paid nothing in 2008 or 2009, at the bottom of the recession, may have paid a great deal in other years. Losses, write-offs and accelerated depreciation all legally push a tax bill to zero in a bad year, and refunds often come from carrying losses back against earlier taxes. Paying nothing for one year is legal; whether it is fair is the political question Sanders was raising.

The trillion-dollar bailout figures

The largest numbers, such as $1.3 trillion for Bank of America, add up emergency loans from the Federal Reserve over the course of the crisis. Many of those were short-term loans that were rolled over again and again, so the same dollars were counted several times, and they were repaid with interest. The Treasury’s TARP program, which put capital directly into banks, was smaller: about $443.5 billion in total, with Bank of America, Goldman Sachs and JPMorgan Chase all repaying their shares. Treasury reported earning more on its TARP investments overall than it put in. None of that cancels the point that the banks were rescued with public backing at a moment when ordinary borrowers were not, but the headline totals are not money handed over and kept.

Offshore estimates are hypothetical

The “offshore estimate” figures describe what companies might owe if profits held abroad were taxed at US rates. Under the law of the time, that tax was deferred until the money came home. The estimates show the size of the incentive, not a bill the companies dodged illegally.

What changed after 2012

The fiscal cliff was settled in January 2013 by a deal that raised income tax rates on the highest earners, while the wider grand bargain Fix the Debt wanted never arrived. Corporate taxation changed far more in 2017, when the Tax Cuts and Jobs Act cut the federal corporate rate from 35 percent to 21 percent and imposed a one-time tax on profits that had been held abroad, ending much of the deferral the report criticised. According to Wikipedia’s summary of the campaign, Fix the Debt’s CEO Council itself shifted its focus from shrinking the debt toward tax cuts around that time.

Sanders kept the same themes at the centre of his presidential campaigns in 2016 and 2020: corporate tax avoidance, outsourcing and the influence of large banks. This report is an early, concrete example of how he made that case with company-by-company numbers.

Why this list still matters

Corporate tax avoidance remains a live issue. The global minimum tax on large multinationals, agreed through the OECD in 2021, grew out of the same frustration with profits booked in low-tax places. For readers, the lasting lesson is practical: when a politician or campaign quotes a dramatic figure, check which year it covers, whether it is a loan or a gift, and whether it is an actual tax bill or an estimate. Sanders’ report holds up on its basic facts, and it is still a useful window into how the 2012 deficit debate was fought.

Sources: Senator Bernard Sanders, “Top Corporate Tax Dodgers” (October 2012); Wikipedia: Fix the Debt; PJ Media, 25 October 2012; Wikipedia: Troubled Asset Relief Program; Wall Street Journal (CEO statement); first shared via True Activist.

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