{"id":910,"date":"2006-04-16T08:35:41","date_gmt":"2006-04-16T13:35:41","guid":{"rendered":"http:\/\/chimeraobscura.com\/vm\/more-on-job-destruction\/"},"modified":"2006-04-16T08:35:41","modified_gmt":"2006-04-16T13:35:41","slug":"more-on-job-destruction","status":"publish","type":"post","link":"http:\/\/chimeraobscura.com\/vm\/more-on-job-destruction","title":{"rendered":"More on Job Destruction"},"content":{"rendered":"

Last July, I wrote about the nuttiness of the American Jobs Creation Act<\/a>, 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<\/a>, calling it an “absurd provision of a law designed to create jobs.”<\/p>\n

It’s a good piece, but she makes a “numbers in a vacuum” argument about Pfizer, which leads me to wonder if she’s not being fair toward the other companies, which are in fields that I don’t cover. She writes,<\/p>\n

At Pfizer, the pharmaceutical giant that announced the single largest repatriation\u00c3\u00a2\u00e2\u201a\u00ac\u00e2\u20ac\u009d$37 billion\u00c3\u00a2\u00e2\u201a\u00ac\u00e2\u20ac\u009dthe one-time windfall works out to approximately $11 billion. That kind of tax savings buys a lot of $600-an-hour lobbyists, though not, apparently, many scientists and salespeople. In its annual report, Pfizer doesn’t list employees by region. But the company’s total head count dropped to 106,000 at the end of 2005, about 8 percent fewer jobs than at the end of 2004.<\/p><\/blockquote>\n

Thing is, those layoffs weren’t at all related to Pfizer’s overseas profits. They were a result of Pfizer acquiring Pharmacia and Warner-Lambert, along with a raft of smaller companies. Those acquisitions basically guaranteed layoffs in the thousands; this is what’s known as “generating efficiencies by combining operations.” So those layoffs were in the works long before the AJCA was passed in 2004.<\/p>\n

Now, you can argue that the acquisitions were foolhardy or unlucky (especially the Pharmacia one, which pivoted on the Celebrex\/Bextra franchise), but complaining that the company should have kept ‘redundant’ employees on because it had this one-time tax refund coming is flat-out stupid.<\/p>\n","protected":false},"excerpt":{"rendered":"

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 an “absurd provision of a … <\/p>\n

Continue reading “More on Job Destruction”<\/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-910","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-eG","jetpack_likes_enabled":true,"jetpack-related-posts":[{"id":1019,"url":"http:\/\/chimeraobscura.com\/vm\/pfed","url_meta":{"origin":910,"position":0},"title":"Pf***ed","author":"Gil","date":"July 7, 2006","format":false,"excerpt":"Sorry for the lack of posts, readers! I'm really busy on the home-stretch of that Top Companies special issue. Gotta finish the final profile today, so's I can head to the shore tomorrow without worrying about it. I decided to save the biggest one for last: Pfizer. As you may\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":586,"url":"http:\/\/chimeraobscura.com\/vm\/american-job-destruction-act","url_meta":{"origin":910,"position":1},"title":"American Job Destruction Act","author":"Gil","date":"July 25, 2005","format":false,"excerpt":"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\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":2112,"url":"http:\/\/chimeraobscura.com\/vm\/creative-creation","url_meta":{"origin":910,"position":2},"title":"Creative Creation?","author":"Gil","date":"June 24, 2008","format":false,"excerpt":"A few years ago, I wrote about the American Jobs Creation Act (here and here), a bill passed in 2004 that permitted U.S. companies to repatriate overseas funds at a reduced tax rate (essentially 5.25%). It was a one-time act, and made some sense, given that the U.S. has one\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":3689,"url":"http:\/\/chimeraobscura.com\/vm\/too-big-to-fail","url_meta":{"origin":910,"position":3},"title":"Too Big To Fail?","author":"Gil","date":"March 27, 2009","format":false,"excerpt":"Here's my From the Editor column from the March issue of my magazine. Enjoy: Too Big To Fail? The pharmaceutical industry is experiencing a deepening productivity crisis. The industry\u00e2\u20ac\u2122s preferred escape mechanism from this predicament has been to increase investment in current business activities \u00e2\u20ac\u201d primarily R&D and sales \u00e2\u20ac\u201d\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":1233,"url":"http:\/\/chimeraobscura.com\/vm\/pfailed","url_meta":{"origin":910,"position":4},"title":"Pfailed","author":"Gil","date":"December 3, 2006","format":false,"excerpt":"What a difference two days make. On Nov. 30, Pfizer gave an \"R&D open house\" event where it discussed its drug pipeline. The biggest drug in that pipeline is torcetrapib, a compound that raises \"good\" cholesterol. For years, Pfizer's been developing it as a combo-drug with Lipitor (atorvastatin), which reduces\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":1573,"url":"http:\/\/chimeraobscura.com\/vm\/drop-and-give-me-1800","url_meta":{"origin":910,"position":5},"title":"Drop and give me 1,800!","author":"Gil","date":"July 3, 2007","format":false,"excerpt":". . . words, that is. There's only one profile remaining for me to write for the Top Companies issue: Pfizer! (I save the biggest for last; that's just the sorta guy that I am.)","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":[]}],"_links":{"self":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/posts\/910","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=910"}],"version-history":[{"count":0,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/posts\/910\/revisions"}],"wp:attachment":[{"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/media?parent=910"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/categories?post=910"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/chimeraobscura.com\/vm\/wp-json\/wp\/v2\/tags?post=910"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}