FAANG Companies like Facebook, Amazon, Apple, Netflix, and Google (Alphabet) are taking our valuable personal data without paying us a penny. They hoard it, filter it and sort it with their secret algorithms, then exploit it, spinning what they’ve taken into billions in revenue. They are at once a monopoly and a monopsony (a sole purchaser of data), deciding which content producers will be paid, in the manner of a communist central planner, and determining what content billions of users will consume.
We have allowed those powerful companies to enter our homes and lives to extract personal assets worth billions of dollars without paying us one cent for taking them. These digital assets once they are shorted, organized in Pools of data, become extremely valuable that the powerful corporations use them in commerce in a way that drives countless small businesses and independent retailers into bankruptcy, leaving main streets everywhere in a state of decay and desertion.
Our personal Data / digital assets are converted into billions of dollars of cash, but the companies move that cash out of our country and warehouse it in countries that have the lowest corporate tax rates.
Our neighborhoods become less vital, because the federal, state and local taxes that pay for roads, police and clean water dry up.
Some might say: FAANG Companies aren’t really stealing our data, because we’re getting valuable services and products in exchange. Who doesn’t love free music? Who doesn’t love a free e-mail service like Gmail?
But scratch that, and it’s easy to see that it’s not “free” at all. It’s a good-old-fashioned barter transaction: We are exchanging something of value for something else of value.
FAANG Companies gives us free e-mail or mapping services in exchange for a trove of our personal data — where we shop, how much we travel, whether we take medicine or buy concert tickets — which it then turns into targeted marketing information worth, in the aggregate, billions of dollars to retailers and advertisers Here’s the problem: Since Barter transactions are taxable, especially when they are done systematically and for commercial gain. The problem is, our government hasn’t yet treated these transactions as barter transactions. FAANG Companies are billions richer from it, while our towns and cities and our most economically vulnerable people are billions poorer.
We are not making this up. The law is very clear: All barter transactions are taxable, as our tax laws have held for many decades. The U.S. Congress’s formal recognition of the barter industry, passed the barter tax compliance provisions of the Tax Equity and Fiscal Responsibility Act (TEFRA) in 1982, is still considered the global model for tax reporting of barter exchange transactions. The same law recognized barter trade exchanges on a par with banks and credit card companies as “third party recordkeepers” of the financial records of other taxpayers. All U.S. barter exchanges now submit to the tax authorities yearly total of the barter sales of their clients via 1099 forms. Section 61 of our Internal Revenue Code states that “all income” is taxable, even if it’s not in the form of cash.
