Apple Tax Strategy Cheats California Communities

Apple Mouse

I didn’t pay much attention to how Apple avoids paying billions of dollars in taxes through perfectly legal tax strategies all over the world. Not a big deal. Many Fortune 500 companies do whatever they can to avoid paying corporate taxes. Then I heard that Apple had set up a small office in Reno, Nevada, to funnel their profits through to avoid paying Califronia’s 8.84 percent corporate tax as Nevada doesn’t have a corporate tax. I started seeing red—and it wasn’t an apple.

Apple’s headquarters are in Cupertino, Calif. By putting an office in Reno, just 200 miles away, to collect and invest the company’s profits, Apple sidesteps state income taxes on some of those gains.

California’s corporate tax rate is 8.84 percent. Nevada’s? Zero.

Setting up an office in Reno is just one of many legal methods Apple uses to reduce its worldwide tax bill by billions of dollars each year. As it has in Nevada, Apple has created subsidiaries in low-tax places like Ireland, the Netherlands, Luxembourg and the British Virgin Islands — some little more than a letterbox or an anonymous office — that help cut the taxes it pays around the world.

If you ever considered incorporating your business in California, the Nevada corporate tax avoidance strategy is frequently mentioned in business incorporation books. Given the choice between paying 8.84 percent versus zero percent for a corporate tax rate, most individual business owners will go for zero percent. That particular tax strategy is useful if you can easily cross the state line from living in California to working in Nevada (i.e., the Lake Tahoe area). For many California businesses located far from the Nevada state line, this isn’t a viable tax strategy.

For many multinational corporations like Apple, skipping state and international lines to avoid paying corporate taxes that deprive communities of much needed tax revenues for services, infrastructure and schools is a matter of routine business.

You will often see this line on many Apple products: “Designed by Apple in California.”

I think Apple needs to decide to whether or not if they—the business managers that run the corporation as I don’t consider corporations to be people—are a California company. If so, they should pay California corporate taxes. If they want to avoid paying California corporate taxes, they should relocate their headquarters to Nevada—or Texas.

 

The California Lottery Black Scratcher Lady Luck Video

The California Lottery has a new video featuring Lady Luck, a tall redhead in black leather and high heels who keeps pictures of obvious losers hanging in her apartment, picks one at random, and slaps the poor schmuck when she finds him scratching off a $5 USD Black Scratcher in an bowling alley to shock him into realizing that he won. Who knew that Lady Luck was such a bitch and bowling alleys still exist?

The Welcome Mat After An Unwelcome Visit

Welcome Mat After An Unwelcome VisitI have suffered various indignities from living in an apartment complex for nearly seven years: paint falling from the upstairs balcony and the clean up that didn’t happen, kitchen flooded by plumber in the downstairs apartment, an extended water repair and drunk kids ripping off the car radio antenna. A new item can be added to that list.

The apartment complex became pet friendly this year, allowing residents to have cats or small dogs. After growing up with a depressed mother who decided to become a cat lady—my family had 91 cats in a three-bedroom house in the early 1990’s—I never wanted to be around small furry animals again. That’s why I’m a fish person. My nine-inch-long green terror cichlid fish has never given me or anyone else any problems. I wasn’t thrilled to find out about—and didn’t pay—the $1,000 USD pet deposit for having a 25-gallon fish tank.

The hallway outside my apartment stank like a cat litter box that went bad in a hurry. I assumed that it was one of the apartments and complained to the leasing office. The maintenance guy propped open the fire door at the end of the hallway, ignoring the posted fire department notice not to do that. The smell didn’t disappear after a few days. I noticed that my rustic welcome mat had an unusual stain on the top, flipped it over to find a bigger stain, and  a matching stain on the hallway carpet.

I have found the source of the smell—and I was pissed.

This was the closest I ever came to having an OCD attack. That some animal—cat, dog, drunk neighbor, all of the above—had fouled my welcome mat with an unwelcome visit drove me up the wall. The next morning I took pictures with my iPad 2, showed them to the leasing agent at the office, and the maintenance guy was sent out with industrial rug cleaner to scrub down the hallway carpet from fire door to fire door. The overwhelming stench is gone but I can still detect a lingering residue.

I’m leaving the front doorstep bare for now. While I have an identical rustic welcome mat for the balcony doorstep that I could move to the front doorstep, I’m going to keep it there for now. I’m moving out of the apartment complex at the end of summer. I don’t need any further indignities from marauding cats, dogs and/or drunk neighbors.

Review – The Wild Bikini Girls Of Diablo III

The Wild Bikini Girls of Diablo III
The Wild Bikini Girls of Diablo III

Blizzard Entertainment put Diablo III into open beta to stress test the servers over the past weekend, giving everyone an opportunity to play the new game for the first time before being released on May 15, 2012. I wasn’t impressed. If you played Diablo I and/or Diablo II, you’re playing the same game.

As a male player, I like to take on a female persona. When I was testing Unreal Tournament 2003 multiplayer at Accolade/Infogrames/Atari (same company, different owners, multiple identity crisis), all the testers—including the few women testers—went with the generic male avatars. I went with the slim Asian female avatar. That made me stand out in the game as I extensively tested the sniper rifle from various hiding spots throughout the levels. My coworkers howled for my head from their cubicles. They ganged up to flush me out and chase me into open space, finding out that I was just as good with the rocket launcher and flak cannon.

When I fired up Diablo III to create my avatar, clicked on the female gender button and was disappointed by the style of female avatars available. The Demon Hunter, Monk, Witch Doctor and Wizard were all skinny young things that look like plague victims—or fashion models. Only the Barbarian was a good solid woman, reminding me of Aviendha in Robert Jordan’s “Wheel of Time” series, whom someone else pointedly told her: “Those hips are made for babies.”

I was somewhat surprised to find that my Level 1 Barbarian started off in bikini underwear. I can’t imagine any women—barbarian or not—going into a demon-infested hellhole wearing nothing more than two pieces of leather to cover her privates. But this is the video game industry, where little boys like to play with their joysticks and imaginary women. All the other female avatars also starts off in bikini underwear. This is only a temporary condition. As you pick up more equipment to cover up your bikini-clad avatar, the Tin Man from The Wizard of Oz will become more recognizable than your avatar.

If that wasn’t bad enough, the female Barbarian’s voice has an Ahnold-like accent (think Schwarzenegger with a strawberry-blond wig).

As for the rest of the game, the new user interface takes advantage of today’s video graphics and wide-screen monitors. Rats scurrying from dead bodies, ravens flying from trees, and abandoned houses collapsing as your avatar walks by are nice little touches. Alas, being beta software, the transparency effect for torches and other “flashy” items were pixelated blocks on my ATI Radeon 3780 512MB video card—well above the minimum video card specs—that made gameplay difficult at times.

Without a doubt, Blizzard has another solid winner here. Now if they can only drop the price down to $20 USD from the outrageously high $60 USD that they are planning to charge for the game. Otherwise, I’ll finish off Diablo II that I picked up last year when Blizzard dropped the price.

Movie In Trouble If Kick-Ass Heroine Shows Ass In Poster?

Seems like “The Avengers” movie is being hyped to death with so many sneak previews, behind the scene featurettes, short clips and pictures in the past month that there may be no movie left to watch. When that happens, the trailer will be better than the actual movie.

Someone complained on Twitter that Black Widow (Scarlett Johansson) was showing her ass while looking over her shoulder in the latest movie poster. That sounded familiar. I pulled two other movie posters—“The Reaping” (2007) with Hillary Swank and “G.I. Joe: The Rise of Cobra” (2009) with Sienna Miller—with “The Avengers” movie poster in question into a side-by-side graphic. (If there are better examples than this, let me know in the comments.) This begs the obvious question.

Is the movie in trouble if kick-ass heroine shows her ass in the poster? Maybe.

“The Reaping” and “G.I. Joe” both scored low—8% / 53% versus 35% / 62%, respectively—on Rotten Tomatoes, being okay movies rather than good movies. I enjoyed “The Reaping” better with Hillary Swank playing the spiritually-compromised skeptic confronted with the Biblical plagues in a small Bible Belt town. Although “G.I. Joe” had its fun moments, the movie was a half-hour too long.

Being the big popcorn movie to usher in the summer movie season, “The Avengers” is supposed to blow everything else out the doors. I’m doubtful. The hype machine is going into overdrive, indicating that the studio is nervous that the movie won’t fare well at the theaters and not realizing that the hype could kill the movie long before then. No one wants to see a movie with no surprises. A kick-ass heroine showing her ass on the poster can only do so much to save the movie.

When The Titanic Came To San Francisco

The “Titanic – The Exhibition” came to the Metreon in San Francisco in 2006. The most impressive item was the “Big Piece,” a 40-foot tall, 15-ton hull section. The Titanic was 11-stories tall and had more rivets (three million) than the San Francisco Golden Gate Bridge (1.2 million). Although scientists and historians might come up with new reasons for why the Titanic collided with an iceberg, we must never forget that 1,500 people died in this tragedy and the captain’s last words were, “Every man for himself.”

Titanic Ship Model

The Shakedown Behind The DOJ Apple/Publisher eBook Antitrust Lawsuit

Money Versus ParagraphsThe Department of Justice filed an antitrust lawsuit against Apple and the major publishers for conspiring to force Amazon to sell ebooks at higher price points than $9.99 USD. This is ironic—and moronic—for several reasons.

Until Apple introduced the agency model for letting publishers set their own ebook prices and keeping 70% of each sale, Amazon had a 90% market share as it sold the bestsellers as lost leaders to sell more Kindle devices and the publishers kept 35% of each sale. After those changes went into effect, Amazon’s market share dropped to 60% as Apple, Barnes & Noble, Sony and other ebook retailers expanded their market share.

The DOJ may have a better antitrust case against the publishers for maintaining higher ebook prices than it does against Apple. The publishers are still stuck in the traditional brick-and-mortar world of printed books. If the ebook price of a new printed book is substantially less, the consumers will favor the cheaper alternative. Higher ebook prices are necessary to maintain an unsustainable business model.

Why does the ebook version of a 50-year-old science fiction novel, “Starship Troopers” by Robert A. Heinlein, have to be priced at $9.99 USD like a premium paperback?

But the antitrust lawsuit isn’t really about ebook prices. It’s about Apple sitting on $100-billion-dollar in cash reserve and not sharing the wealth with the Washington lobbyists, who in turn wine and dine the political establishment.

The DOJ Shakedown

When Microsoft had a multi-billion-dollar cash reserves, it spent nothing on lobbyists. After the DOJ filed the antitrust lawsuit in 1998, Microsoft spent millions of dollars each year on lobbyists thereafter. The antitrust lawsuit failed to quash Microsoft’s twin monopoly in operating systems and office suites, but it was a significant boon for Washington lobbyists.

As Silicon Valley companies acquire huge market share and cash reserves, they have to spend more money on Washington lobbyists as the DOJ and other regulatory agencies threaten various legal actions, and entertain presidential candidates when they stomp through Silicon Valley for campaign fundraisers. As Willie Sutton once said about banks, it’s where the money is.

If that wasn’t ironic enough, lobbyists are complaining about a new rule that would prevent them from wining and dining the two million federal workers who are not politicians but often wield indirect influence on the government.

Investigate Amazon

Being a writer who publishes ebook, the antitrust lawsuit is a concern but doesn’t impact me as my short story and essay ebooks are priced from $0.99 USD to $2.99 USD. I doubt I will ever put out an ebook priced at $9.99 USD or higher .

Like many things in life, I have the opposite problem. When I released my writing blog compilation ebook, I priced it at $0.99 USD on Amazon and, because it was listed for FREE on Smashwords, there was a “technical glitch” regarding the pricing info that made it unavailable. I subsequently had to unpublished the ebook from Amazon.

If the DOJ wants to get serious about ebook prices, they should investigate Amazon for stifling FREE ebooks.

UPDATED 04/16/2012 — Looked like it was a technical glitch. My writing blog compilation ebook is available at Amazon—for $0.99 USD. I’m pestering them to make it free. Probably won’t happen until the ebook appears on the Smashwords third-party distribution network (i.e., Apple, Barnes & Noble, Diesel, Kobo, Sony, etc.).

Squirrels, Squirrels And Robosquirrels

Brown Squirrel

If you stopped looking at your computer screen long enough to look out the window (i.e., the big blue room with the bright yellow light), you might notice that Silicon Valley is filled with squirrels. The common brown squirrel can be found everywhere. The black squirrel in Sunnyvale and Mountain View. (If you travel up to Placerville near Lake Tahoe, the grey squirrel can get as big as a football.) And in the eastern foothills of San Jose, the robosquirrel is the newest squirrel in the valley.

In a flash of fangs, the rattlesnake lunged, striking in less than a second. Its prey: a mechanical, remote-controlled squirrel, now with a pool [of] venom in its head.

“That was really exciting,” said ecology doctoral student Bree Putman. “The snake saw it as real prey.”

On a high-tech reserve in the rolling, pastoral hills east of San Jose, Putman and her adviser, San Diego State ecologist Rulon Clark, are using robosquirrel to understand the relationship between the predator and prey, which it turns out is “complicated.” That’s where robosquirrel comes in. Clark and Putman said that decoding their conversations, one robotic move at a time, could help explain how populations of the pesky critters naturally balance out.

I wasn’t aware that squirrels would confront a rattlesnake by going nose-to-nose and waving its tail, which confuses the rattlesnake as the squirrel’s heat signature becomes much larger, and was immune to snake venom until I read this article.

When I went into work on Black Friday —the day after Thanksgiving when most Americans are out shopping—in November 2008, the Fortune 500 campus along the Mountain View shoreline was eerily deserted without any vehicle traffic. As I took public transportation back then, I had to walk a mile from the bus stop. I noticed all the squirrels along the way and all the squirrels noticed me. If that wasn’t creepy enough, the city of Mountain View had to trap attacking squirrels in Cuesta Park in 2007. Turned out I wasn’t supposed to be at work and I later went shopping.

That experience became the basis for an unpublished short story about a call center support technician trapped in an office building with killer squirrels while his roommates are out shopping on Black Friday. I haven’t been able to sell the print rights since most editors don’t want a holiday-themed short story in their non-themed anthology, and its too long for many holiday-themed anthologies. I’m planning to do a final revision for publication as a short story ebook in October. Maybe the story will go from “man versus nature” with killer squirrels to “man versus technology” with killer robosquirrels.

If the military is developing ariel drones that look like small birds to spy from the sky, wouldn’t robosquirrels be the next technological leap in ground surveillance? Once that technology gets loose in the wilds, anything could happen.