The Wall Street Journal noted last week that American shareholders will lose tens of billions of dollars in investment income from their stock holdings in Silicon Valley companies like Google and Apple if several European Union sham lawsuits prevail.
These are generally suits alleging that America’s dominant tech companies are acting like monopolists. Or, to borrow a term, our tech companies are “price gouging.” Many of these companies are now above $2 trillion in their market cap. Every pension fund in America expands in size and benefits are paid out to workers when these companies expand.
The EU’s courts outrageously ruled this week that Apple shareholders owe Europe 13.5 billion euros in back taxes because the company took advantage of Ireland’s low 12.5% tax rate. The EU “competition chief” declared that this sham court decision “is a big win for European citizens and tax justice.” No, it’s a big win for big government.
Meanwhile, Google shareholders are now forced to pay the EU $2.7 billion because its search engine has become dominant in the European market. The European search engines are so inferior that nobody wants to use them. So, sue American companies.
Let’s be clear here: The EU laggards are simply green with envy. The Eurozone has been crushed by American tech dominance. No company in socialist Europe has found a way to compete with American innovation at Google, Apple, Microsoft, Amazon, Nvidia, Meta, and so on. Since they can’t compete, they invent sore-loser lawsuits.
That’s what the losers in sports from junior high school always pout about: The other side didn’t play fair.
The bigger issue is why the Biden administration isn’t defending American companies from European extortion. These tech lawsuits are a tax on American know-how and innovation.
Instead of defending American shareholders from the EU predators, the Biden regulators encourage and give legitimacy to the foreign courts.
How can the U.S. government complain against specious antitrust attacks (tech prices are falling dramatically) against Google and Apple when our own regulators at the Federal Trade Commission and the Justice Department are bringing copycat lawsuits against our tech giants in U.S. courts? Lina Khan of the FTC has spent nearly four years peppering our tech industry leaders with nuisance lawsuits of her own.
The capricious fine against Google is a result of an American company shopping around the globe to find the lowest tax climate (Ireland) for doing business. This is illegal? Our corporate tax rate thanks to the Trump tax cut is now 21%, down from 35% under former President Barack Obama. But President Joe Biden and now presidential candidate Kamala Harris want to raise it back up to 28% or more. That only encourages more jobs and investment to move offshore. Did I mention that Ireland’s rate is just 12.5%?
Instead of lowering the rates here, Treasury Secretary Janet Yellen wants to force Ireland and other low-tax countries to raise their rates to a global minimum tax of 15% or more. This sounds a lot like collusion and cartel policy. It’s like telling Kellogg’s they can’t charge less than $3 a box for Special K as a way to compete with Cocoa Crispies.
Similarly, the antitrust lawsuits from Europe and Washington aimed at American tech companies are spurious because nearly every price for tech services — from cellphones to drone deliveries to internet searches to fiber optic hookups — has been falling. How are consumers getting gouged if they keep paying less for new technologies?
There’s an old saying in sports: no harm, no foul.
I often don’t like the politics of Big Tech. But the end result of what Washington is doing to penalize American tech giants for building a better mousetrap is to move the high-tech hubs of the world — from Silicon Valley to Austin to Boston to Miami — to competitor nations. That’s a good way to lose jobs and put America last.
Stephen Moore is a co-founder of Unleash Prosperity. He is also an economic advisor to the Trump campaign. His new book, “The Trump Economic Miracle,” coauthored with Arthur Laffer, will be released later this month.
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The most important paragraph in this entire article is this:
“Let’s be clear here: The EU laggards are simply green with envy. The Eurozone has been crushed by American tech dominance. No company in socialist Europe has found a way to compete with American innovation at Google, Apple, Microsoft, Amazon, Nvidia, Meta, and so on. Since they can’t compete, they invent sore-loser lawsuits.”
As someone who was in the tech industry for almost 40 years and still has many business interests in it, the above paragraph sums up the rationale for why the EU is constantly targeting American tech companies. The regulatory stranglehold and layers of taxation common in the EU prevents tech start-ups from either getting working capital or being able to operate in a business environment specially tailored to protect the old, stagnant legacy industries and crushing any potential newcomers. As a result, Europe missed out on the PC boom in the 1980s, the Internet boom in the 1990s, and now it appears also the dawn of the AI boom that will transform almost every manner of work environment around the world. So, the EU has been reduced to simply trying to make up some of the trillions in lost business opportunities over the last 45 years via a series of ridiculous and obviously desperate lawsuits in courts where they control the verdict outcomes.
As you stated Stephen ” These tech law suits are a tax on American know-how and innovation”. So, like a ball of yarn that a cat has been playing with there are many tangled parts that will take time to get untangled — and time probably fits into the strategy for those anti American groups intent on going about their unethical ways to cause havoc with this technology — if it is American in origin. There are ways to stop this lawsuit mania from European groups of manipulators — it has to do with dedication to truth and respect for ethical business practices. Eventually the right strength and knowledge of people who see through this anti American motivated movement will be recognized as being in favor of what is sensible business practice. The European strategy and it’s allies here will not be able to crush the innovation that is a natural sort of strength and intelligence that presents. a foundation for doing things right. That is for the betterment of people who are thinking right.
Google should shut down the search engine in Europe, in response.
They have been putting the United States last since their first day they killed the Keystone Pipeline. Yet, they allowed Russia to build their pipeline.
Biden and Harris, despite their posturing, DON’T want an affluent, successful middle class that can exert political force by funding non-liberal campaigns. Harris’ “middle class talk” about home ownership is only a Trojan Horse sales pitch for implementing “UN Agenda 21”, which would lock in “Democrat” economic control over millions more people…just like Lyndon Johnson’s “Great Society”, and those filthy, drug-and-crime-infested, 1960’s & 1970’s urban housing projects…. which should NEVER come back.
The free living from those housing projects and welfare checks destroyed urban work ethics, culture, and economies, and caused many viable businesses to leave their home cities… which “torpedoed” urban work opportunities, and fueled a death-spiral of violent crime, prostitution, and addiction. I’ll never forget all the businesses along the Delaware River in Philly that moved out. Other than Boeing Helicopter, Industrial Highway became a ghost town. The Chester area became a crime disaster, and so did north Philly.
Nobody should vote for Harris/Walz, unless they want to go back to that awful past.
Everything Biden/Harris does puts America last…FACT.l
Every American parent must watch, ArrestedBy Kamala.com who had parents arrested because their children missed school while she was Attorney General of California. This is what she will do to every American parent with children. This is serious and how Americans are put last.
Hannity last night was down in the dumps cuz Fed cut the interest rate by 1/2 point …..mainly cuz close to election. Hannity makes millions & does not have to worry about living paycheck to paycheck & this comment shows he does not support the needs of poor and middle class. What a stupid comment from FOX & if you study economics the whole point is to prevent a recession and keep inflation under control which is a big benefit to us peons that are not upper class .
Where’s the investigation on Communist harris lying about Iran and saying there are no American soldiers being attacked anywhere?
When it comes to technology and foreign policy all of the democrats are pretty much with biden in his basement watching”loonie tunes”.
Why does Trump support a government shutdown on Sept 18th. During his term, a record was set for most days of a shutdown & that was not good for USA and Americans. It is really sad when an ex-POTUS is pushing this for political reasons only>