For the most recent fiscal year 2011, these 16 US Big Electronic/Electrical Equipment & Products Manufacturing Corps registered Total Pretax Income of $8.8 bil, which was an increase of a robust 36% over 2010, and an increase of an even more robust 89% over 2009.
In deriving Pretax Income, I start with Pretax Income under Generally Accepted Accounting Principles (GAAP), and then exclude several clearly unusual very large items relative to Pretax Income, such as Asset Impairment Charges.
Clearly, the Obama Administration has created a US economic environment which has permitted these US Big Electronic/Electrical Equipment & Products Manufacturing Corps to flat out flourish.
I think a major contributor to this strong profit performance in the US Big Electronic/Electrical Equipment & Products Manufacturing Industry was the 100% first-year tax expensing of equipment purchases, which was in effect for all of 2011 and for the last part of 2010.
Since this 100% first-year tax expensing goes away in 2012, the earnings growth of this industry will drop markedly.
The US economy needs a huge jolt in 2012.
The US Congress has been the major reason that the earnings growth of manufacturers will be declining markedly in 2012.
First, the US Congress recalcitrantly treated the clearly job-creating 2011 American Jobs Act as dead on arrival. This Jobs Act had some powerful job creation, particularly the US infrastructure investments in it.
And second, and more importantly, the US Congress decided to not extend the 100% first-year tax expensing in 2012. The most effective way this extension could have occurred is for it to permit the very largest US Corps be eligible for it only if they also increase their full-time payroll head counts sufficiently in 2012. The very largest US Corps, like ATT and Verizon, were the ones that selfishly abused the 100% tax expensing by taking massive advantage of it, while at the same time, slashing their US full-time payroll counts.
And then for all other companies, this 100% first-year tax expensing in 2012 should have had no full-time payroll count requirements to be eligible for it.
If the first-year 100% tax expensing would have been extended in the above manner, this would have been substantially more of a US job creator in 2012 than the 2% payroll tax holiday, and also less costly to the US Government over the long term.
And if some form of more explosive acceleration in 2012 of first-year tax depreciation on building investments by businesses would have been enacted, it would have taken the 2012 US job creation to a completely different level, and clearly where it should be to be fair to all US citizens.
Below here is the Pretax Income and Pretax Losses of these 16 US Big Electronic/Electrical Equipment & Products Manufacturing Corps for each of the most recent three years.
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