Wednesday, March 30, 2011
Caterpillar CEO: No Plans to leave Illinois
Recent news reports had Caterpillar Corporation threatening to move out of Illinois, because of the substantial increase to state personal and corporate tax rates. These reports were based on a letter that was sent to Illinois Governor Pat Quinn from Caterpillar CEO Doug Oberhelman. In a speech on Wednesday to the U.S. Chamber of Commerce, Oberhelman stated that Caterpillar is not planning to leave Illinois. This looks like another case of sensationalistic reporting, where statements are taken out of context and facts are distorted to sell copy. Caterpillar is definitely disappointed with the Illinois’ revised tax code, but Caterpillar considers Illinois home. This is good news for my employer who does in excess of $30 million dollars of business with the Illinois based Caterpillar facilities.
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I found this article to be interesting because just recently I was reading someone’s viewpoint on the entire situation. This person’s view was that it used to be if a corporation wanted to practice the art of extortion, it would do so well outside the public eye. He continued to say, not anymore though now you will find CEOs out in the open and proud of it when they want to extract more money out of the taxpayers. Much of what I had read about CEO Douglas Oberhelm was that he had wrote a letter to the Illinois governor complaining about the states recent increase in the corporate tax rate from 4.8% to 7%. He also had said in his letter that 4 other states have approached the company offering generous allowances if they would move their headquarters to their states. In the letter I guess he never said I will move, but said he had to do what is right for Catterpillar. I think if you read into that or what he was trying to say is we’re threatening to leave the state if you don’t rescind this tax increase. But, this is not the only company that has done this. Take for example everything that went on in Fond du Lac with Mercury. We have heard about many companies doing this or something similar. But is it good business practice? Is it necessary in order to continue making a profit and stay in business? Times have definitely changed in corporations when you look back through history.
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