Scott Galloway is bold, and probably a bit brazen, in his attitude towards The Four – Google, Amazon, Facebook and Apple Tech companies. Galloway’s edgy demeanor stems from his twenty plus years of experience with, and study of, these companies. Galloway is quick to admit he has personally profited from his investment in Amazon and Apple stock, and professionally Amazon is the largest recruiter for the business classes he teaches at New York University’s Stern School of Business. Even so, Galloway has formed a singular conclusion: “It’s time to break up big tech.” “He’s angry that these companies create growth without prosperity. He knows that many people tend to blame global trade and immigrants for our problems, but he insists the tech economy and its “fetishization” is equally to blame”.
In a time when this country is using approximately 21 percent of GDP to keep the military armed and parks open, Galloway highlights a startling statistic that The Four tech companies paid the following tax percentages between 2007-2015: Amazon 13 percent, Apple 17 percent, Google 16 percent, and Facebook 4 percent (far lower than the 25 percent average needed for a thriving economy). My dad, a wise man, would be quick to tell you that the tax law, as it was written then, LEGALLY allowed companies to avoid taxes, so “why blame the company”? Blame the government – essentially Congress – for writing and keeping the complex tax law… (Can you tell I’ve had this discussion at the Thanksgiving table before?) Of course the profits of The Four are significant and the country is still receiving a hefty tax payment. However, Apple (and by no means are they the only company implicated in this practice) has sheltered $250 billion overseas. “Apple, for example, uses an accounting trick to move its profits to domains such as Ireland, which results in lower taxes for the most profitable firm in the world. As of September 2017, the company was holding $250 billion overseas, a hoard that is barely taxed and should never have been abroad in the first place.”
Galloway clearly establishes that above all, companies are profit driven (which is the foundation of Capitalism – remember The Protestant Work Ethic?). “Since the turn of the millennium, firms and investors have fallen in love with companies whose ability to replace humans with technology has enabled rapid growth and outsize profit margins. Those huge profits attract cheap capital and render the rest of the sector flaccid.” But for all the good a profitable company can contribute to society (and by all means society loves The Four big tech companies and their personal benefits: connection (Facebook), quick answers (Google), shopping and groceries (Amazon) and smartphone security (Apple)) Galloway is throwing up a penalty flag claiming that The Four’s monopoly is “dangerous for our society, and it shows no signs of slowing down. It hollows out the middle class, which leads to bankrupt towns, feeds the angry politics of those who feel cheated, and underpins the rise of demagogues.”
Of grave concern to me and Galloway, and highly relevant to my research, is the ongoing (and highly inaccurate) rhetoric that refugees, immigrants, and globalization are harmful to the economy and society. According to the New American Economy Research Fund, the sample 2.3 million refugees who arrived in the United States since 1975, earned more than $77 billion in household income and paid almost $21 billion in taxes in 2015. Outside of the tax payments, refugees were left with $56 billion in spending power. The report, From Struggle to Resilience: The Economic Impact of Refugees in America, shows:
- Refugees have an entrepreneurship rate that outshines even that of other immigrants.
- Refugees contribute meaningfully to our economy as earners and taxpayers.
- While refugees receive initial assistance upon arriving in the United States, they see particularly sharp income increases in subsequent years.
- Refugees make particularly meaningful contributions to the economies of several key states.
- Even more so than other immigrants, refugees take steps to lay down roots and build lives in America.
- In an era when the country faces unprecedented demographic challenges, refugees are uniquely positioned to help.
Galloway warns the reader of The Four that the primary purpose of the economy, and one of its key agents, the firm, is to create and sustain the middle class (of which most refugees will become members of). The U. S. middle class from 1941 to 2000 was one of the most ferocious sources of good in world history. “The American middle class financed, fought, and won good wars; took care of the aged; funded a cure for polio; put men on the moon; and showed the rest of the world that self-interest, and the consumption and innovation it inspired, could be an engine for social and economic transformation.” Sadly, the middle class is being diminished – even more likely obliterated financially. Have you considered the implications for losing the middle class?
Galloway appears stumped by the current state of laissez faire attitude towards big tech companies… “Where is the Department of Justice? Where are the furious Trump tweets?” and I will add my own disbelief – why are we condemning and turning away potential refugee contributors to our economy? The impact of financial contribution by refugees has been proven – and it’s significant! We are at a pivotal moment in history when we have 4000 refugee asylum seekers knocking on our front door. Let’s open that door and embrace our brothers and sisters – offering opportunities for a new life and capitalizing on the refugee spirit of survival and enterprise.
16 “But Peter kept on knocking, and when they opened the door and saw him, they were astonished.”(NIV)