{"id":586,"date":"2005-07-25T10:19:00","date_gmt":"2005-07-25T14:19:00","guid":{"rendered":"http:\/\/chimeraobscura.com\/vmalt\/?p=586"},"modified":"2006-04-16T08:21:57","modified_gmt":"2006-04-16T13:21:57","slug":"american-job-destruction-act","status":"publish","type":"post","link":"http:\/\/chimeraobscura.com\/vm\/american-job-destruction-act","title":{"rendered":"American Job Destruction Act"},"content":{"rendered":"

When I write my annual Top 20 Pharma Companies & Top 10 Biopharma Companies report<\/a> (this year’s edition is soon to post at the website of my day job<\/a>), I read a lot of annual reports, along with industry analysis, news coverage, and other neat sources. <\/p>\n

The annual reports have two parts: the glossy front half, hyping the company to the general public, and the fine-print back half, breaking down a lot of the numbers and providing SEC-mandated information (litigation issues, executive compensation, accounting policies, etc.). It took a couple of years before I started to understand a little of the subtext in the reports.<\/p>\n

I’m still no expert with this stuff (or I’d be making a lot more money), but I do find it pretty fascinating. For example, virtually every company I profiled this year included a variation on the following:<\/p>\n

On October 22, 2004, President Bush signed into law the American Jobs Creation Act of 2004 (AJCA), which creates a temporary incentive for U.S. corporations to repatriate undistributed income earned abroad by providing an 85% dividends received deduction for certain dividends from controlled foreign corporations. Although the deduction is subject to a number of limitations and uncertainty remains as to how to interpret certain provisions of the AJCA, we believe we have the information necessary to make an informed decision on the impact of the AJCA on our repatriation plans. Based on that decision, we plan to repatriate [bazillions of dollars] . . .<\/p><\/blockquote>\n

The upshot of the AJCA was that foreign revenues, which were previously taxed at 38%, were now to be taxed at 5.25% for a single year, if repatriated for the purpose of “creating jobs”. Turns out that a lot of companies have been stowing away a lot of money in foreign revenues, rather than bringing it back to the U.S., where it would have been taxed to bejeesus. Pfizer has decided to bring nearly $37 billion in foreign money into the U.S. under the AJCA. I thought the numbers were pretty astounding, but I had no idea (and no time to research) how much money other major companies were repatriating.<\/p>\n

According to this article from BusinessWeek<\/a>, it turns out my industry is way out in front. In comparison with Pfizer’s enormous stash, Dell’s bringing back just $4.1 billion. Problem is, there’s no way to show that the money’s being used to create jobs. After all, if Pfizer’s R&D budget is $8 billion for 2005, according to the AJCA, they could use the repatriated money for that same R&D budget, and spend the originally budgeted money on buying solid gold rocket cars for all the top executives.<\/p>\n

It’s a pretty ineptly named bill since, erversely enough, a bunch of companies benefiting from the American Jobs Creation Act (like Pfizer and Merck) are in the process of dismantling some of their operations and laying off a bunch of employees. Read more about it<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

When I write my annual Top 20 Pharma Companies & Top 10 Biopharma Companies report (this year’s edition is soon to post at the website of my day job), I read a lot of annual reports, along with industry analysis, news coverage, and other neat sources. The annual reports have two parts: the glossy front … <\/p>\n

Continue reading “American Job Destruction Act”<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[12],"tags":[],"class_list":["post-586","post","type-post","status-publish","format-standard","hentry","category-pharmaceuticals"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"jetpack_shortlink":"https:\/\/wp.me\/p4C7K-9s","jetpack_likes_enabled":true,"jetpack-related-posts":[{"id":1543,"url":"http:\/\/chimeraobscura.com\/vm\/i-want-a-new-drug","url_meta":{"origin":586,"position":0},"title":"I want a new drug","author":"Gil","date":"June 7, 2007","format":false,"excerpt":"I enjoy writing the big Top 20 Pharma \/ Top 10 Biopharma report each June. Sure, it's not what I imagined I'd be doing when I was a brooding, pretentious idiot in college, but it turns out that there's plenty of fun to be had in researching and writing these\u2026","rel":"","context":"In "Big Business"","block_context":{"text":"Big Business","link":"http:\/\/chimeraobscura.com\/vm\/category\/big-business"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1819,"url":"http:\/\/chimeraobscura.com\/vm\/da-boom","url_meta":{"origin":586,"position":1},"title":"Da boom","author":"Gil","date":"December 13, 2007","format":false,"excerpt":"Yesterday was one of Those Days. I refer to them as \"Blow Up The Outside World Days,\" since I usually remark, \"I will kill everyone on the planet,\" at least three or four times. They don't happen very often; in this instance, it's a function of getting our annual year-end\u2026","rel":"","context":"In "Big Business"","block_context":{"text":"Big Business","link":"http:\/\/chimeraobscura.com\/vm\/category\/big-business"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":910,"url":"http:\/\/chimeraobscura.com\/vm\/more-on-job-destruction","url_meta":{"origin":586,"position":2},"title":"More on Job Destruction","author":"Gil","date":"April 16, 2006","format":false,"excerpt":"Last July, I wrote about the nuttiness of the American Jobs Creation Act, a one-time tax break for companies bringing overseas profits back to the U.S. (the tax rate on such earnings drops from about 38% to about 5%). Michelle Leder at Slate just wrote about the subject, calling it\u2026","rel":"","context":"In "Pharmaceuticals"","block_context":{"text":"Pharmaceuticals","link":"http:\/\/chimeraobscura.com\/vm\/category\/big-business\/pharmaceuticals"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":334,"url":"http:\/\/chimeraobscura.com\/vm\/phase-0","url_meta":{"origin":586,"position":3},"title":"Phase 0","author":"Gil","date":"August 4, 2004","format":false,"excerpt":"Neat article in today's NYTimes about changes in preclinical drug testing. That subject matter may not interest you too much, but it's part of my day job, and I have a vested interest in seeing the pharma\/biopharma industry come up with better methods of drug discovery & development.The best part\u2026","rel":"","context":"In "Pharmaceuticals"","block_context":{"text":"Pharmaceuticals","link":"http:\/\/chimeraobscura.com\/vm\/category\/big-business\/pharmaceuticals"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":2118,"url":"http:\/\/chimeraobscura.com\/vm\/what-it-is-63008","url_meta":{"origin":586,"position":4},"title":"What It Is: 6\/30\/08","author":"Gil","date":"June 30, 2008","format":false,"excerpt":"What I'm reading: The Black Swan: The Impact of the Highly Improbable, by Nassim Nicholas Taleb, along with more 10-K statements and annual reports for my Top Companies issue. What I'm listening to: 5:55 by Charlotte Gainsbourg again. And again. What I'm watching: Yankees-Mets, The Minor Accomplishments of Jackie Woodman,\u2026","rel":"","context":"With 2 comments","block_context":{"text":"With 2 comments","link":"http:\/\/chimeraobscura.com\/vm\/what-it-is-63008#comments"},"img":{"alt_text":"","src":"http:\/\/www.assoc-amazon.com\/e\/ir?t=virtualmemories-20&l=as2&o=1&a=B000PDZFCK","width":350,"height":200},"classes":[]},{"id":2077,"url":"http:\/\/chimeraobscura.com\/vm\/bottoms-up","url_meta":{"origin":586,"position":5},"title":"Bottoms up","author":"Gil","date":"May 28, 2008","format":false,"excerpt":"Sorry I didn't post earlier in the day, dear readers. I was just building up my courage for the plunge into our annual Top Companies Report, where I profile the top 20 pharma companies and top 10 biopharmas. I just have to tell myself, \"Come July 2, it'll all be\u2026","rel":"","context":"In "Big Business"","block_context":{"text":"Big Business","link":"http:\/\/chimeraobscura.com\/vm\/category\/big-business"},"img":{"alt_text":"","src":"http:\/\/www.assoc-amazon.com\/e\/ir?t=virtualmemories-20&l=as2&o=1&a=B000FI73MA","width":350,"height":200},"classes":[]}],"_links":{"self":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/posts\/586","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/comments?post=586"}],"version-history":[{"count":0,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/posts\/586\/revisions"}],"wp:attachment":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/media?parent=586"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/categories?post=586"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/tags?post=586"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}