The Tax Advantage of Big Business: How the Structure of Corporate Taxation Fuels Concentration and Inequality

Corporate concentration in the United States has been on the rise in recent years, sparking a heated debate about its causes, consequences, and potential remedies. In this study, we examine a facet of public policy that has been largely neglected in current debates about concentration: corporate taxation. As part of our analysis we develop the first empirical mapping of the effective tax rates (ETRs) of nonfinancial corporations disaggregated by size and broken down by jurisdiction. Our findings reveal a striking and persistent tax advantage for big business. Since the mid-1980s, large corporations have faced lower worldwide ETRs relative to their smaller counterparts. The regressive worldwide ETR is driven by persistent regressivity in the domestic ETR and a marked drop in the progressivity of the foreign ETR over the past decade. We go on to show how persistent regressivity in the worldwide tax structure is bound up with the increasing relative power of large corporations within the corporate universe, as well as a shift in firm-level power relations. As large corporations become less disposed to investments that may indirectly benefit ordinary workers, they become more disposed to shareholder value enhancement that directly benefits the asset-rich. What this means is that the corporate tax structure is connected not only to rising corporate concentration, but also to widening household inequality

America's Real 'Debt Dilemma'

In the wake of the current crisis there has been an explosive rise in the level of the US public debt. These massive levels of public indebtedness are expected to keep growing unless there are drastic changes to existing budgetary policies. According to a recent series in the Financial Times, the US now faces a ‘debt dilemma’ over whether the country should bring its fiscal house in order through tax hikes on the rich or cuts to entitlement programs. This apparent dilemma has sparked a debate over which groups should bear the burden of debt repayment and fiscal adjustment. However, one crucial question remains unasked: whose powerful interests are served by the public debt? Mapping the share of federal bonds holdings of and interest to the top 1%, my research uncovers a staggering trend towards concentration over the past three decades and shows that federal income taxes and transfer payments have done little to offset this regressive distribution. Increases to the public debt without progressive redistributive policies are likely to aggravate an already explosive situation characterized by inequality, while decreases to the privately held portion of the public debt are likely to encounter resistance from the top 1%. This is America’s real debt dilemma

Corporate ownership of the public debt: mapping the new aristocracy of finance

In various writings Karl Marx made references to an ‘aristocracy of finance’ in Western Europe and the USA that dominated ownership of the public debt. Drawing on original research, this article offers the first comprehensive analysis of public debt ownership within the US corporate sector. The research shows that over the past three decades, and especially in the context of the current crisis, a new aristocracy of finance has emerged, as holdings of the public debt have become rapidly concentrated in favour of large corporations classified within Finance, Insurance and Real Estate. Operationalizing Wolfgang Streeck's concept of the ‘debt state’, the article goes on to demonstrate how concentration in ownership of the public debt reinforces patterns of social inequality and proceeds in tandem with a shift in government policy, one that prioritizes the interests of government bondholders over the general citizenry

A dynamic model of Venus's gravity field

Unlike Earth, long wavelength gravity anomalies and topography correlate well on Venus. Venus's admittance curve from spherical harmonic degree 2 to 18 is inconsistent with either Airy or Pratt isostasy, but is consistent with dynamic support from mantle convection. A model using whole mantle flow and a high viscosity near surface layer overlying a constant viscosity mantle reproduces this admittance curve. On Earth, the effective viscosity deduced from geoid modeling increases by a factor of 300 from the asthenosphere to the lower mantle. These viscosity estimates may be biased by the neglect of lateral variations in mantle viscosity associated with hot plumes and cold subducted slabs. The different effective viscosity profiles for Earth and Venus may reflect their convective styles, with tectonism and mantle heat transport dominated by hot plumes on Venus and by subducted slabs on Earth. Convection at degree 2 appears much stronger on Earth than on Venus. A degree 2 convective structure may be unstable on Venus, but may have been stabilized on Earth by the insulating effects of the Pangean supercontinental assemblage

Financial Crisis, Inequality, and Capitalist Diversity: A Critique of the Capital as Power Model of the Stock Market

The relationship between inequality and financial instability has become a thriving topic of research in heterodox political economy. This article offers the first critical engagement with one framework within this wider literature: the Capital as Power (CasP) model of the stock market developed by Shimshon Bichler and Jonathan Nitzan. Specifically, we extend the CasP model to other advanced capitalist countries, including Germany, France, the United Kingdom, and Japan. Our findings affirm the core prediction of the CasP model, showing that unequal power relations reliably predict future stock market performance. Yet when it comes to the CasP model’s explanation of why power relations predict stock market returns, our findings are more ambiguous. We find little empirical support for the claims that capitalist power is dialectically intertwined with systemic fear, and that systemic fear and capitalised power are mediated through strategic sabotage. The main lesson of our analysis is that any model of the stock market must be attentive to the geographical unevenness and continued national diversity in capitalist development

HyPaFilter - A versatile hybrid FPGA packet filter

With network traffic rates continuously growing, security systems like firewalls are facing increasing challenges to process incoming packets at line speed without sacrificing protection. Accordingly, specialized hardware firewalls are increasingly used in high-speed environments. Hardware solutions, though, are inherently limited in terms of the complexity of the policies they can implement, often forcing users to choose between throughput and comprehensive analysis. On the contrary, complex rules typically constitute only a small fraction of the rule set. This motivates the combination of massively parallel, yet complexity-limited specialized circuitry with a slower, but semantically powerful software firewall. The key challenge in such a design arises from the dependencies between classification rules due to their relative priorities within the rule set: complex rules requiring software-based processing may be interleaved at arbitrary positions between those where hardware processing is feasible. We therefore discuss approaches for partitioning and transforming rule sets for hybrid packet processing, and propose HyPaFilter, a hybrid classification system based on tailored circuitry on an FPGA as an accelerator for a Linux netfilter firewall. Our evaluation demonstrates 30-fold performance gains in comparison to software-only processing.Horizon 2020 (Grant ID: SSICLOPS project, 644866)This is the author accepted manuscript. The final version is available from the Association for Computing Machinery via http://dx.doi.org/10.1145/2881025.288103

HyPaFilter+: Enhanced Hybrid Packet Filtering using Hardware Assisted Classification and Header Space Analysis

Firewalls, key components for secured network in- frastructures, are faced with two different kinds of challenges: first, they must be fast enough to classify network packets at line speed, second, their packet processing capabilities should be versatile in order to support complex filtering policies. Unfortu- nately, most existing classification systems do not qualify equally well for both requirements: systems built on special-purpose hardware are fast, but limited in their filtering functionality. In contrast, software filters provide powerful matching semantics, but struggle to meet line speed. This motivates the combination of parallel, yet complexity-limited specialized circuitry with a slower, but versatile software firewall. The key challenge in such a design arises from the dependencies between classification rules due to their relative priorities within the rule set: complex rules requiring software-based processing may be interleaved at arbitrary positions between those where hardware processing is feasible. We therefore discuss approaches for partitioning and transforming rule sets for hybrid packet processing. As a result we propose HyPaFilter+, a hybrid classification system consisting of an FPGA-based hardware matcher and a Linux netfilter firewall, which provides a simple, yet effective hardware/software packet shunting algorithm. Our evaluation shows up to 30-fold throughput gains over software packet processing.We would like to acknowledge the support of the German Federal Ministry for Economic Affairs and Energy and the German Federal Ministry of Education and Research. This work was, in part, supported by the EU Horizon 2020 SSICLOPS project (grant agreement 644866)

From passive owners to planet savers? Asset managers, carbon majors and the limits of sustainable finance

This article examines the role of the Big Three asset management firms – BlackRock, Vanguard and State Street – in corporate environmental governance. Specifically, it investigates the Big Three’s relationships with the publicly listed Carbon Majors: a small group of fossil fuels, cement and mining companies responsible for the bulk of industrial greenhouse gas emissions. Engaging with the corporate governance concepts of ownership and control, and exit and voice, it charts the rise to prominence of the Big Three, including their environmental, social and governance (ESG) funds, in the ownership of the Carbon Majors. Having established their status as key sources of permanent capital that are unlikely to exit from their investment positions in the world’s most polluting publicly listed corporations, the article examines how control may be exercised through voice by analysing the Big Three’s proxy voting record at Carbon Major annual general meetings. It finds that they more frequently oppose rather than support shareholder resolutions aimed at improving environmental governance and that their voting is more likely to lead to the failure than to the success of these resolutions. Remarkably, there is little to distinguish the proxy voting of the Big Three’s ESG funds from their non-ESG funds. Regardless of whether these resolutions succeeded or failed, they also tend to be narrow in scope and piecemeal in nature. Overall, the article raises serious doubts about the Big Three’s credentials as environmental stewards and argues instead that they are little more than stewards of the status quo of shareholder value maximization

Flow properties of driven-diffusive lattice gases: theory and computer simulation

We develop n-cluster mean-field theories (0 < n < 5) for calculating the flow properties of the non-equilibrium steady-states of the Katz-Lebowitz-Spohn model of the driven diffusive lattice gas, with attractive and repulsive inter-particle interactions, in both one and two dimensions for arbitrary particle densities, temperature as well as the driving field. We compare our theoretical results with the corresponding numerical data we have obtained from the computer simulations to demonstrate the level of accuracy of our theoretical predictions. We also compare our results with those for some other prototype models, notably particle-hopping models of vehicular traffic, to demonstrate the novel qualitative features we have observed in the Katz-Lebowitz-Spohn model, emphasizing, in particular, the consequences of repulsive inter-particle interactions.Comment: 12 RevTex page