Goldman Sachs Pays 1% Tax Rate

The Morning Reaction post by kula2316 at dkos starts off summarizing all the news about welfare applications skyrocketing around the nation and then moves onto a report of Goldman Sachs' year-end results:

Um... with all the news about welfare applications skyrocketing, more and more Americans needing food stamps or food banks, numerous states slashing their budgets, and our national debt increasing by the second, what is wrong with this picture?

Goldman Sachs Group Inc., which got $10 billion and debt guarantees from the U.S. government in October, expects to pay $14 million in taxes worldwide for 2008 compared with $6 billion in 2007.

The company's effective income tax rate dropped to 1 percent from 34.1 percent, New York-based Goldman Sachs said today in a statement. The firm reported a $2.3 billion profit for the year after paying $10.9 billion in employee compensation and benefits.

$14 million, eh? On profits of $2.3 billion? After receiving assistance from the federal government?

The rate decline looks "a little extreme," said Robert Willens, president and chief executive officer of tax and accounting advisory firm Robert Willens LLC.

"I was definitely taken aback," Willens said. "Clearly they have taken steps to ensure that a lot of their income is earned in lower-tax jurisdictions."

This is insane. The article mentions $14 million in worldwide taxes. I wonder how much of that will actually go to the government that bailed them out?

"This problem is larger than Goldman Sachs," Doggett said. "With the right hand out begging for bailout money, the left is hiding it offshore."

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Oh, but I certainly hope all those Goldman Sachs execs enjoy their holiday bonuses, as The Guardian (UK) reports:

A multimillion-pound bonus pot will still be shared by workers at Goldman Sachs, which benefited from a US bank bail-out and yesterday posted its first loss since going public nine years ago.

The payout, worth around £55,000 per employee, was confirmed as the Wall Street bank blamed "extraordinarily difficult operating conditions" for a fourth-quarter loss of $2.12bn (£1.4bn). It still achieved a $2.32bn profit for the full year to November, although this was sharply lower than last year's $11.6bn.

I know there are so many things to be outraged about lately, but this really sets me off. Working and middle class Americans are losing their jobs and relying, in ever increasing numbers, on welfare or food stamps or soup kitchens. Meanwhile, Goldman Sachs takes $10 billion of taxpayer money and pays barely any taxes and then distributes its profits for bonuses. Am I missing something here or is this definitely an outrage?

What she said.