Apple vs. Senate - Looks like Apple Won
As people continue to digest the recent testimony by Apple’s (NASDAQ: AAPL) Tim Cook in front of the Senate Permanent Subcommittee on Investigations last week, it seems that an increasing amount of critics are in the form of people who have no trouble getting media exposure.
The latest is former U.S. Senator John Sununu who is now a columnist for the Boston Globe. He echoed what many have said since Cook’s testimony: why is the Senate asking Apple to defend actions that break no laws?
Sununu pointed out that at the most recent State of the Union address, Apple CEO was one of the guests of honor that sat with first-lady Michelle Obama and received a mention by the president himself as a truly American company.
Contrast that with Senator Carl Levin, the chair of the committee, who wouldn’t claim that any laws were broken but accused the company of pursuing “the holy grail of tax avoidance.” Like most Congressional hearings, especially those that end up on CNBC, there’s far more of a motivation than the customary, “we just want the truth line.” Sununu, in his column, makes that clear.
While it didn’t come up at the hearing, Apple isn’t the only company that knows how to legally work the system. Yahoo (NASDAQ: YHOO) does it—so does Google (NASDAQ: GOOG)-- and a whole host of other multinationals.
Many take it a step further by keeping money in Ireland, Caribbean Islands and the Cayman Islands. A small island in the middle of the ocean certainly seems like the natural place to keep your spare billions so it’s safe to assume that Apple setting up shop in Ireland only (that we know of) shows a little restraint.
As more people had a chance to think about it over the long weekend, (which means write blogs and talk about it on the cable news networks) the scorecard shows a clear win for Apple. What was supposed to put some pressure on the company to return at least of some of the $100 billion to U.S. soil only helped to bolster the case for corporate tax reform. Who in their right mind would pay more taxes than legally required?
Interestingly, another fall out of the hearing came over the weekend when it was announced that Ireland is rethinking its tax policies for these multinational companies. This is a case where the biggest loser may be Ireland. For a country that loves publicity, this wasn’t what it was looking for.
And one more, by the way. If we hear any more Senators touting their investigative abilities in uncovering the global-scale Apple conspiracy, Bloomberg reported that Senators were provided the information by Apple.
Disclosure: At the time of this writing, Tim Parker was long Apple.
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