General Electric Turns to Twitter to Defend Its Tax Practices

Reuters
Uri Friedman 737 Views Mar 28, 2011

The New York Times caused a stir on Friday with an article exploring the strategies General Electric allegedly employed to avoid paying any U.S. taxes in 2010. GE has rushed to defend itself, choosing an interesting forum to fight back: Twitter.

Ever since the Times story came out, GE has used its GE Public Affairs Twitter feed to point news outlets writing about the topic--including the Wire--to the company's "tax facts" and to trot out a stable of statistics and statements. GE has argued that, contrary to the "misleading" and "oversimplified" Times article, the company doesn't take advantage of tax loopholes and in fact paid around $2.7 billion in "cash income taxes" in 2010 globally, including "significant U.S. federal income tax payments."

GE isn't the first company to use Twitter as a public relations vehicle to combat bad press. In the wake of the Deepwater Horizon oil spill, for example, BP transformed its Twitter feed into a stream of updates on relief efforts in the Gulf of Mexico. The tactic spawned a fake BP Twitter account that mocked BP's PR efforts.

Twitter has effectively enabled companies to reach out to opinion-makers in real-time PR campaigns. This afternoon, for instance, Business Insider's Henry Blodget engaged in a testy back-and-forth with GE on the microblogging site (at one point, Blodget threatened, "I'm writing headline now. Should it be 'GE: NYT Lied About Our Taxes' or 'How GE Tried To Mislead Everyone On Twitter?'").

After his volley of questions about what exactly GE meant by "significant U.S. federal income tax payments" went unanswered, Blodget grew suspicious: "Let this be a lesson to you, corporations who view Twitter as a fantastic tool for spinning, once you assert something on Twitter and then go silent when you are asked simple questions about it, the folks you're trying to snow are going to conclude that you're just trying to spin them," he wrote.

Want to add to this story? Let us know in comments or send an email to the author at ufriedman at theatlantic dot com. You can share ideas for stories on the Open Wire.

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