Apple Not Paying Taxes

The last time the mayor of Cupertino walked into Apple – the largest company in his small Californian town and, it so happens, the most valuable company in the world – he hoped to have a meeting to talk about traffic congestion.

Barry Chang barely made it into the lobby when Apple’s security team asked him to leave, he said.

“They said ‘you cannot come in, you’re not invited’. 

After that I left and have not gone back,” said an exasperated Chang, who’s been mayor since December 2015 and had approached the computing firm when he was serving on the city council three years ago.

Many people in Cupertino, a 60,000-person town in the heart of Silicon Valley, are beginning to organize around their overburdened city. 

They claim the region is struggling with aging infrastructure and booming companies whose effective tax rate is often quite low. 

Frustrated by traffic and noise, some in Cupertino are trying to put a stop to more development, which they argue brings more congestion on the roads, parking and train system. 

But Chang says limiting new development would damage the regional economy and that the real solution should be higher taxes on the wealthy and companies such as Apple. 

In response to Chang’s pro-development efforts, a group called Cupertino Citizens for Sensible Growth is working to recall him for failing “to fulfill his fiduciary duty to Cupertino citizens”. 

He says he’s “not afraid” and is running for California’s state assembly. 

Convincing local politicians to battle Apple is hard, Chang said. He recently proposed that Apple – which is building a massive new campus its own employees nicknamed the Death Star, or more favorably, The Spaceship – should give $100m to improve city infrastructure. 

To move on the proposal, Chang only needed to get a single vote ‘yes’ among the three other eligible council members. He failed to get that vote.

“This American politics. This so-called democracy,” Chang said, recalling the unanimous ‘no’ vote. “Apple is such a big company here. 

The council members don’t want to offend them. Apple talks to them, and they won’t vote against Apple. This is the fact.” Read more: 

Trying to Lower Drug Prices

Drug companies are expected to pour $100 million into an effort to squash the referendum in what will be a test of the industry’s strength at a time of growing consumer backlash against drug prices. 

The initiative would require the state to pay no more for prescription drugs than the U.S. Department of Veterans Affairs — one of the few federal agencies allowed to negotiate drug prices.

From the industry’s perspective, California could set a dangerous precedent. 

Besides having an economy the size of many small countries, the liberal bastion is often a laboratory for new ideas that take root and then spread east. 

That’s even more likely given that the presidential front-runners are pushing the federal government to negotiate drug prices for Medicare.

“This is the crack in the door” on drug pricing, said Jamie Court, president of Consumer Watchdog, a California nonprofit devoted to consumer protection issues. 

“If any Democrat in America wants bulk purchasing in Medicare, it will start with bulk purchasing for the most liberal state government in America.”

Which is precisely the intention of the initiative’s sponsor, Michael Weinstein, CEO of the Los Angeles-based AIDS Healthcare Foundation. 

“If we win, we hope it will start a national prairie fire,” he said. 

Weinstein pursued the ballot measure after years of in-your-face activism on AIDS and after watching the California state legislature fail to do anything about drug prices — a big concern to people with HIV/AIDS who may be taking costly drugs for the rest of their lives.

Drug companies have easily trounced such opponents in the past, but the California battle comes at a particularly perilous moment. 

Public anger at drug prices is at an all-time high, driven by headlines about executives who un-apologetically jacked up prices 5,000 percent. 

That is happening against the backdrop of a campaign cycle in which Americans are bucking the establishment in favor of insurgent candidates like Trump, Sen. Ted Cruz and Sen. Bernie Sanders. 

It is not a coincidence that the industry is fighting a related referendum in Ohio, suing to try to keep it off the ballot.     Read more:

Water Shortage in California

APPLE VALLEY, Calif. — Outside her two-story tract home in this working-class town, Debbie Alberts (above), a part-time food service worker, has torn out most of the lawn. 

She has given up daily showers and cut her family’s water use nearly in half, to just 178 gallons per person each day.

A little more than 100 miles west, a resident of the fashionable Los Angeles hills has been labeled “the Wet Prince of Bel Air” after drinking up more than 30,000 gallons of water each day — the equivalent of 400 toilet flushes each hour with two showers running constantly, with enough water left over to keep the lawn perfectly green.

Ms. Alberts was the only one of them that has been fined for excessive water use.

Four years into the worst drought in California’s recorded history, the contrast between the strict enforcement on Californians struggling to conserve and the unchecked profligacy in places like Bel Air has unleashed anger and indignation — among both the recipients of the fines, who feel helpless to avoid them, and other Californians who see the biggest water hogs getting off scot-free.

This wide disparity in enforcement is testimony to California’s vast and chaotic system for moving water from reservoirs and underground systems to homes. There are 411 separate water districts — some public, some private — and each of these local utilities has been charged with devising its own rules for saving water during the drought.

All of the districts are grappling with a mandatory order from the State of California to reduce water consumption by up to 36 percent. The contrasting approaches taken by Apple Valley and Los Angeles illustrate how differently communities are enforcing the order — some with lenience, others with punishments.

In Apple Valley, the private utility company that supplies water to most of this town in the high desert east of Los Angeles has been ordered to cut back 28 percent. The utility, Apple Valley Ranchos, responded by applying “drought surcharges” to households that exceed a standard monthly water allotment. Nearly a third of the 20,000 customers have been assessed fines, which can run to hundreds of dollars.

Ms. Alberts, whose husband is disabled and not working, supports them and their two children on an income of about $22,000 a year. She received a surcharge of $79.66 on her last two-month water bill, raising the total above $330.

“It’s impossible to get under the line,” said Ms. Alberts, 58, whose property is about half an acre and was once surrounded by greenery. “We wash clothes once a week. We flush every third time. Sometimes we go to the laundromat because we’re afraid.”       Read more: