Category: Newsworthy

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O is for Overhead

Overhead is a term used by people who are overhead. No one wants overhead. No one wants to be overhead. No one wants to pay for overhead. But we’re all basically overhead.

Overhead, figuratively and literally. Photo from wikipedia.

Pity the Poor, Ignoble Overhead

Overhead refers to the costs a company incurs for expenses that are not directly related to whatever is being produced. Typically, these are “fixed” costs, costs that don’t change regardless of how many hamburgers are flipped or customer calls are handled. Examples might include everything from the CEO’s salary to the desks to the fees for Internet connectivity.

Most people, when they think about paying for a product, focus on only the product itself. I should only have to pay for the sandwich. How can it cost so much to make a pill? They think of a product as only the sum of the ingredients, rather than factoring in the distribution, packaging, design, testing, communication (advertising), inventory, or any number of other costs that have to exist in order for them to have the ability to buy that thing at that time at their convenience.

Very important overhead, especially in COVID times. Thank you janitors!!! Photo from shutterstock.
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I is for Ireland

“Leprechaun economics” is the term Nobel-prize winning economist Paul Krugman used. With all due respect to Ireland–that greenest land of wind, stories, and music to soothe the soul–their tax law sucks bilgewater.

Leprechaun economics, picture at ginokenny.com.

The Republic of Ireland has managed, in the last fifty years, to transform itself into the world’s largest tax haven. Meaning a place that allows multinational corporations, particularly those formed and operating in the U.S., to use creative accounting to pay very little in taxes. How little? How about 0.005%?

Apple Chooses Between Single Malt or Double Irish

Apple is a company that has always thought far in advance about packaging and design–including on their financial statements. Back in 1980, about the time when they were prototyping the Macintosh, Apple opened a small office in Cork, Ireland, lured by a deal to pay no taxes for several years. Such local tax arrangements aren’t that unusual–Twitter moved into a derelict building in downtown San Francisco for the same “no tax for years” deal, while Delaware has long been known as a favorable legal and financial place for companies to incorporate.

What Apple was also able to do, over decades, was use its growing economic power to support an Irish shift into a myriad of favorable tax strategies–favorable to corporations, that is. A so-called Base Erosion and Profit Shifting (BEPS) plan allows companies to put their huge patents as giant assets on their balance sheets, in Irish subsidiaries. These patents, the stock and trade for tech companies, are amortized (charged out over time) in a convoluted way that allows the income received to be located in Ireland–with very low tax rates–even if it was earned somewhere else.

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Old Friends Made New

At the risk of sounding pedantic, I want to spend a few words talking about the power of art.

What does Katy Perry have to do with the fall of Sauron? Creativity, talent, music, words, the human expression of emotion can stave off the darkness and give us the strength to go forward in facing challenges. Reconnecting with art we know makes it even more powerful.

Katie Perry gestured. It was corny, it was Americana, it was breathtakingly beautiful. Photo from Getty Images.

Who’s Lung-Busting Kitsch Now?

Maybe you could have looked in a crystal ball six years ago and predicted it. Let’s have the singer of “Sorry, Not Sorry” deliver a moving tribute to health care workers during our next pandemic. Let’s have her use our dear-departed Bill Withers’ “Lovely Day” as a way to bind the country together–online, of course–beamed into the White House. Demi Lovato never looked more elegant and the world never looked more “alright with me.”

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