The leftist editors over at the flailing New York Times went after one of America’s most successful and innovative companies, FedEx, over it’s low corporate tax rate:
In the 2017 fiscal year, FedEx owed more than $1.5 billion in taxes. The next year, it owed nothing. What changed was the Trump administration’s tax cut — for which the company had lobbied hard.
The public face of its lobbying effort, which included a tax proposal of its own, was FedEx’s founder and chief executive, Frederick Smith, who repeatedly took to the airwaves to champion the power of tax cuts. “If you make the United States a better place to invest, there is no question in my mind that we would see a renaissance of capital investment,” he said on an August 2017 radio show hosted by Larry Kudlow, who is now chairman of the National Economic Council.
Four months later, President Trump signed into law the $1.5 trillion tax cut that became his signature legislative achievement. FedEx reaped big savings, bringing its effective tax rate from 34 percent in fiscal year 2017 to less than zero in fiscal year 2018, meaning that, overall, the government technically owed it money. But it did not increase investment in new equipment and other assets in the fiscal year that followed, as Mr. Smith said businesses like his would.
Nearly two years after the tax law passed, the windfall to corporations like FedEx is becoming clear. A New York Times analysis of data compiled by Capital IQ shows no statistically meaningful relationship between the size of the tax cut that companies and industries received and the investments they made. If anything, the companies that received the biggest tax cuts increased their capital investment by less, on average, than companies that got smaller cuts.
While no one is surprised that a leftist and Democratic Party shill like the New York Times would go after a successful company like FedEx what no one saw coming was FedEx CEO’s response.
Like any successful CEO Smith did not take the New York Times hit piece lying down. Much like President Trump does when attacked he hit back, and hit back hard.
Take a look at this statement pushing back at the NYT from Fred Smith, CEO of FedEx:
“I hereby challenge A.G. Sulzberger, publisher of the New York Times and the business section editor to a public debate in Washington, DC with me and the FedEx corporate vice president of tax,” wrote Smith.
“Pertinent to this outrageous distortion of the truth is the fact that unlike FedEx, the New York Times paid zero federal income tax in 2017 on earnings of $111 million, and only $30 million in 2018 – 18% of their pretax book income. Also in 2018 the New York Times cut their capital investments nearly in half to $57 million, which equates to a rounding error when compared to the $6 billion of capital that FedEx invested in the U.S. economy during that same year,” Smith added.
As we all know leftists and Democrats by nature like to talk a big game, but like the bullies they are, tend to back down when confronted by a stronger force.
Fred Smith, CEO of FedEx is a legend, so don’t hold your breath waiting to see this debate. The NYT editors will fold like a house of cards.