Are businesses really entitled to unlimited profits?

[Skidmore]

I've been listening to these business people whine incessantly about the cost of doing business eating up their profits. How is it that there is a cost of living applicable to my home, but not their business? Isn't the purpose of making a profit to reinvest in the business? Something is very wrong with profit for profit's sake. We need to end the corporate subsidies. These businesses want a risk-free environment to operate in. I'm sick of seeing referendums on tax breaks for infrastructure and tax breaks for entities which do not want to reciprocate and simply pick up and move out.

[libbygurl]

1. I think corporations now have more rights and privileges than people. nt

[GoBlue]

2. If one is honest...

All true profits are the reward for doing absolutely nothing. That's the magic of capitalism and also it's achilles heal. Capitalism literally robs the whole in order to prosper.It can never achieve equilibrium because it always consumes more than it produces. It requires losers in order for others to be winners. Captialists whining about costs eating up their profits is like a thief whining about the cost of buying a gun to rob his victims. I mean wouldn't thievery be easier if victims just paid up voluntarily.

[DELUSIONAL]

5. That's the best description I've seen of capitalism

People who live on investment income pay very little taxes -- especially under bushie. My 94 year old neighbor was amazed at how little in income tax she was paying compared to the previous year (2003 compared to 2002). We certainly didn't have such a huge cut in our income taxes. She, being a liberal, was concerned about not paying her fair share.

It is the wage earners who are ending up paying for everything. And in this economy their productivity is going up BUT their wages are decreasing -- and more people are bing laid off while the remaining wage earners are expected to take up the slack.

This became clear to me when Time-Warner (I think this was the company) hired a new CEO and paid him a huge multi-million salary -- and then he proceeded to fire enough people so that their salaries equaled his inflated salary. There were two different stories and I checked the figures for to compare.

[depakid]

3. What most corporations want is to externalize their costs

onto the rest of society. So the true costs of doing business or developing land is usually hidden. For example, developers walk off with huge profits for putting up row houses on farmland, but they don't pay roads, schools and other infrastructure to support them. The rest of us do.

[MSgt213]

4. That's why no increase in the minimum wage. Business can't afford it yet,

they pass on every other cost to the consumer. Lawsuits, bad snow storms, price of oil, bad investments you name it. If costs the business more money they pass it along.

The big guys have already gotten us use to the idea of repackaging the same product and selling the same thing for more money. Only now the product is smaller or broken into pieces so they can take more profit on the higher margin pieces.

During the 1990s the flurry of questionable patents started with companies patenting everything from how a web page is view in a browser to how many mouse clicks it takes to buy a product on line. They in turn charge each other for using basic techonogly and pass those costs on to us. Some companies make more money on ideas now then they do making anything.

At any rate if a company doesn't have to pay any labor all their problems will be solved that's why the move overseas. One problem remains though with no one working who's going to buy their products?

[DELUSIONAL]

6. "with no one working who's going to buy their products?" -- Bingo

I think it was Henry Ford who said something on this subject -- fear of making so many and not having the market if people didn't earn enough.

Problem is there is a glut of US made cars and trucks right now --

Seems like by making so many people unemployed -- the workers (the golden goose) is being killed. So the golden goose can't produce the golden goose eggs to buy consumer goods.

[MSgt213]

8. But if I'm selfish and greedy which most of these people are the quick

profits are much more attactive to me then doing my part to keep this country's economy going. Get mine now and forget about the future. Labor right now is seen as Wall Streets worst enemy. Ford saw labor as part of the cycle of running a great company.

[izzie]

9. I think he said this

I want the workers to beable to buy the cars they make.He also pushed for a 40 hr. work week. If I re-call from history books it used to be a sun-up to sun-down work day, and for 6 days. Alot of people who own stock seem to think money from that (capital) is more important than wages. We have been here before. Check out the 1920's and 1880's.Only when the workers get together does it stop. Now that workers own stock in their retirement funds it is even harder, as they can see money coming in with our doing any labor for it so to speak.

[mmonk]

7. In business, there are no guarantees

which is the ultimate flaw in their approach.

[leftyandproud]

10. umm..

They DO reinvest in their busness with the profits. If they didn't, they wouldn't last long.

Drug companies invest 98% of profit back into R&D, because the only way for them to make the profit in the first place is to discover new drugs. They can't survive making tylenol and bayer for the next 50 years. Most of their money comes from new products...and most businesses use their revenues to expand the business.

[Skidmore]

11. AND they expect the taxpayer to

pay for their R&D so they can maintain a profit. Those drug companies are among some of the most profitable corporations in the world.

[SOS]

12. 98%?

From MSNBC:

"Drug industry expenditures for research and development (R&D) were consistently far less than profits. For the top 10 companies, they amounted to only 11 percent of sales in 1990, rising slightly to 14 percent in 2000. The biggest single item in the budget is neither R&D nor profits but something usually called “marketing and administration” — a name that varies slightly from company to company. In 1990, a staggering 36 percent of sales revenues went into this category, and that proportion remained about the same for more than a decade. Note that this is two and a half times the expenditures for R&D.

These figures are drawn from the industry's own annual reports to the Securities and Exchange Commission (SEC) and to stockholders, but what actually goes into these categories is not at all clear, because drug companies hold that information very close to their chests. It is likely, for instance, that R&D includes many activities most people would consider marketing, but no one can know for sure. For its part, “marketing and administration” is a gigantic black box that probably includes what the industry calls “education,” as well as advertising and promotion, legal costs and executive salaries — which are whopping. According to a report by the nonprofit group Families USA, the former chairman and CEO of Bristol-Myers Squibb, Charles A. Heimbold Jr., made $74,890,918 in 2001, not counting his $76,095,611 worth of unexercised stock options. The chairman of Wyeth made $40,521,011, exclusive of his $40,629,459 in stock options. And so on. This is an industry that amply rewards its own."

[DELUSIONAL]

13. That's a good piece of research --

in response to use of profits.

This is just an observation I have -- a friend's daughter got a research job with a major drug manufacturer -- she went into the job as an idealistic kid. What she found was that her company was making so much profit that they had to think of very creative ways to spend the profit. One way was to have "meetings" -- and so the one day meetings were held at 4 star hotels all over the world. First class travel to the meeting and then food, room, meeting from added to the tab. The hotel the daughter stayed at in Seattle was the premiere hotel of the region -- the one Prez and heads of state stay in when they visit Seattle or the region. This happened every quarter -- so that the company could bring down their profits.

Other industry also do this -- suddenly the worker has excess overtime when the company usually doesn't allow overtime hours. End of calendar year and the bean counters realize that they have to spend on overtime to bring down the profits.