While the argument for corporations as the person of the year was fairly comprehensive, a post at The Big Picture reminded us of one other reason the corporation has been just dominating 2012. Look to Washington, where lawmakers are grumpily coming back from their holiday vacations to face the consequences of a fiscal gap, a potential recession and the wrath of their nervous constituents. Meanwhile, corporate leaders are enjoying themselves pre-New Year on the slopes at Gstaad, or so I imagine, given the number of “out-of-office” e-mails I’ve received in the last week.
Do we have a graph to illustrate this? Absolutely! We previously told you how the corporation was has been breaking records for profitability as a share of the economy in recent years (see chart at the bottom). But compare that to the steadily declining share of revenue from corporations to the government (see chart above). A steady program of post-World-War-II tax cuts and the increasing ability of multinationals to keep profits overseas has seen corporations pay less and less into the public till, even as their investors earn more and more.
Corporations, 1; Government, 0.
And 2013 looks promising, too: Corporate leaders throwing themselves behind a grand fiscal bargain have every reason to expect a tax reform project will further lower corporate tax rates.