MSM Again: I Expect This of Granny Herald, Not NBR.

Look at these two headlines from Friday and Saturday:

NBR:

Apple’s NZ unit pays 0.4% tax on 2012 sales of $500m

From New Zealand Herald, and to give NBR their dues, this a lot more duplicitous by dropping the reference to sales as a denominator:

Apple's NZ unit coughs up 0.4% tax

Both pieces by Kristen Paterson; this is how Kristen starts the Herald piece:

Apple's New Zealand division made sales of $571 million last year but paid only 0.4 per cent of that in tax.

Labour's Revenue spokesman David Cunliffe said that's akin to paying nothing at all, and letting a corporation get off "scott free" is something New Zealand taxpayers shouldn't have to stomach.

Shock horror, call in the IRD Storm Troopers, this global company is not paying its fair share of tax in New Zealand. And don’t worry about how the innovation of firms such as this have increased our quality of living far more than the voracious, bottomless stomachs of out-of-control government, David.

It’s a hackneyed story by now; I’ve covered it before:

Amazon is Our Hero, Not the Villain in the Piece.

 Labour’s David Clark Declares War on the Consumer.

However, this time I’m not pointing out differences of philosophy in the reporting: as I implied in reference to the Herald’s headline, there’s something much more slippery happening here.

The 0.4% tax rate Kirsten refers to is tax liability accrued in the financial statements as a percentage of total sales.

Huh? Of sales?

Businesses, be they sole traders, partnerships, special partnerships, LTC’s, QC’s, companies, trusts don’t pay tax on sales; they pay tax on net profit; that's sales, less expenses incurred to make those sales.

To prove the point I’m shining the light of freedom on in this post, I will employ a simple example. Kirsten wants the IRD, presumably – I can't think what the agenda is otherwise - to crush Apple, the big bad foreign corp only paying 0.4% tax on sales; but let’s look at a home grown firm, the current market darling, Xero.

Over 2012 Xero reported sales of $19.3 million, however, hold onto your seats, while paying zero (note the z) tax. That’s 0.00% tax on $19.3 million turnover. What a shocker.

Also, off Fletcher Building’s last financial statements, the similar head line is, shock, horror: ‘NZ’s Fletcher Building Coughs Up Only 0.37% tax – Less than Apple’. In fact let’s rewrite Kirsten’s opening paragraph:

New Zealand firm Fletcher Building made sales of $8.9 billion last year but paid only 0.37 per cent of that in tax.

Does this mean the directors of Fletcher Building and Rod Drury from Xero should now be frog marched for their compulsory interrogation in IRD’s room 101? When you get that letter, there’s no saying no, you know - it’s not the free society. Should IRD be demanding all these directors’ personal bank statements from their banks, unknown to them, then sending in the storm troopers to dismantle their companies?

No, it doesn’t mean this. Because returning just to the former, all this means is Xero, after expenses which were greater than its sales, because its aggressively trying to grow its customer base, generated a loss, and it's only bottom line taxable profit (or tax loss) that is of relevance for calculating tax liability.

So returning to Apple NZ’s 0.4% tax rate as a percentage of sales, what does that tell the reader?

Nothing. It’s an entirely pointless, out of context figure, generated into the headline only for its sensationalist value in appealing to the typical Kiwi’s Luddite xenophobic anti-capitalist prejudice. Chris Keall on the NBR thread points out, rightly, that when you burrow down into the piece there are figures which would seem to highlight inconsistencies with Apple’s tax liability, although in response to that there is, apart from my philosophical defence of Apple in the links above, another commenter who makes the equally valid point that it may well be appropriate Apple uses transfer pricing to take profits back to where it earns its intellectual property, leaving a small profit in NZ representing its sales here of merely low margin product. But all that is beside the point, which is the spurious use of a headline figure designed to play on the prejudice of New Zealand's beef-witted. And while I would have expected Herald to pick up the piece and run with that by-line, I’m disappointed in NBR: I don’t pay my online sub for shoddiness and beat ups against innovative businesses like this, leave that to the rest of the media in New Zealand; in a drought of intelligent press, you were the single oasis of sense, and dare I say it, morality. Some of us are over the emoting, advocacy journalism of the sort that utilises such a sham for a headline.

Related Fourth Estate Posts:

Role of a Free Press: TV 3’s 3rd Degree and Syria.

The Connecticut Shooting

Feeling Our Way to the Police State

Media Studies: 3rd Degree, TV 3 – The Role of the Free Press In An Emoting Age

Disclaimer: I’m not a journalist, nor any part of the media – I’m a blogger. Bloggers are simply the op-ed on party drugs.

A discussion on Twitter last night demonstrated how total has been the spread of that postmodern virus of emoting about issues, rather than thinking on them. I’ve dealt with this topic before, in relation to the media: on this post, I described how this inability to think critically, was leading me ever more quickly down the road to my serfdom. However that previous post had dealt with how mainstream media had lost itself in its own heart of darkness, beyond the light of reason; in this post, the tables are turned.

Last night’s debate was about a 3^rd Degree piece I’ve not even seen yet – I only watch TV in the weekend, so I MySky the show – but I didn’t need to see it to butt into the debate.

The program had featured an interview with a Kiwi who was imprisoned overseas somewhere for lack of paying a fine. Twitterdom lit up with how ‘irresponsible’ the 3^rd Degree crew were with not stumping up the necessary amount to free him – what? I said that was not the job of the journalist, furthermore, there’s something far more important at stake here, to a free society, namely, the free press.

The role of the free press, in that story, was simply to report this man’s situation to us: it ended at that. The belief systems, etc, of the individuals doing the reporting might well take action after that, or not, but that’s not important to their role as journalists - although from a pragmatic point of view, what ‘do’ people expect? Of course a journalist can’t fix everything they’re reporting; if they had that sort of money, they would be in another career entirely – most journalists have unwittingly taken a vow of poverty.

All the usual topic suspects came out in the debate that are sadly pumped into people’s heads in our universities since Derrida and Foucault did their best to destroy our language and our minds by taking identity to the interior with no way back again - remember these women? It was trotted out there is no such thing as an objective reality to report on; power structures are influencers that can’t be avoided, making reportage merely the un-deconstructed waiting for the pen of vendetta; journalists are vocational, thus, everyone I debated with on Twitter – and this is a frightening thing - thought it was the role of the journalist to fix the evils they report on.

No. There most certainly is an objective reality, any other view is a vicious subjectivist insanity of the type Voltaire admitted atrocity is born, and context provides the facts of that reality, rather than being the obscurant of it. The role of journalism (separate to the journalists) is to report that reality objectively, initially, to us. Let me explain this via the short-cut of the Godwin. I always tend to bring in the Godwin, because nothing defines an issue more clearly than the Godwin example of it: I brought up Syria.

I asked those who thought the role of the 3^rd Degree journalist was to free this man, what they thought the role of the free press was in Syria. I’m quite astounded that everyone stuck to their argument. Journalists were in Syria to ‘do good’, by which they didn’t mean to report objectively what was happening, which is the ultimate in bravery, by the way, and the ultimate good; although never defined the line was – look at my Twitter timeline – the journos were there to do good for the people concerned, and that’s what many had lost their lives for.

Wow. That’s really dangerous territory. Mine was the last tweet, which said:

@harryrickit @mattt_fairhurst @3rddegreetv3 Syria: some actions of FSA as barbaric as Assad's: Reporting is thus b4 moral positioning?
— Mark Hubbard (@MarkHubbard33) March 20, 2013

The supporters of ‘journos must do something’ are expecting Syrian journos to take sides? That’s the only underlying interpretation I can give to that. That’s the bottom line for them surely? But that’s not possible, morally, when the Free Syrian Army can match that bastard Assad atrocity for atrocity – they may well have just let off a chemical weapon. Looking at that chemical weapon that may have been used, the only appropriate first report is that such and such side has just used a chemical weapon, ‘this’ is the result of that – no journalist could afford to sit around waiting to see if it was the side they were supporting or not, morally, and therefore whether to censor themselves: now that puts this in context, doesn’t it. I’m saying that the free press is free not just of those coercive states or tyrants who would shut it down; in the first instance, a free press must also be free of the loving, caring, compassionate, brave, committed journalists who often put themselves in danger, or controversy, to bring out into the light of truth, what happened. The first reports out of Syria always are a bomb went off, x number of people were killed: that’s the story the journalists are risking their lives for, there’s nothing more important than that first report, because only on that is all the necessary editorialising afterward possible as it is put in context, or taken out of context and into prejudice of one sort or another.

And this issue is important to this blog, because too many have learned to emote their way through the issues of life, not think about them. The Left politick is founded on that entirely. And that’s why my life is on the road to a new Western serfdom, that has destroyed classical liberalism entirely. We’ve felt ourselves into the prison of other people’s minds.

I love the rough and tumble of Twitter, because debating stuff, often passionately, is how you learn what you believe; your philosophy of life.  But you have to free yourself from that beautiful, sad tyranny of the heart, sometimes.