and Expense 

Our interest income was $61 million, $51 million, and $37 million during 2011, 2010, and 2009. We generally invest our excess cash in investment grade short- to intermediate-term fixed income securities and AAA-rated money market funds. Our interest income corresponds with the average balance of invested funds and the prevailing rates we are earning on them, which vary depending on the geographies and currencies in which they are invested. 

The primary component of our interest expense is related to our capital and financing leases and our long-term debt. Interest expense was $65 million, $39 million, and $34 million in 2011, 2010, and 2009. 

Our long-term liabilities were $2.6 billion and $1.6 billion at December 31, 2011 and 2010. See Item 8 of Part II, “Financial Statements and Supplementary Data—Note 6—Long-Term Liabilities.” 

Other Income (Expense), Net 

Other income (expense), net was $76 million, $79 million, and $29 million during 2011, 2010, and 2009. The primary component of other income (expense), net, is related to foreign-currency gains on intercompany balances. 

Income Taxes 

We recorded a provision for income taxes of $291 million, $352 million, and $253 million in 2011, 2010, and 2009. The effective tax rate in 2011, 2010, and 2009 was lower than the 35% U.S. federal statutory rate primarily due to earnings of our subsidiaries outside of the U.S. in jurisdictions where our effective tax rate is lower than in 

the U.S. Earnings of our subsidiaries outside of the U.S. primarily relate to our European operations, which are headquartered in Luxembourg. The favorable effective tax rate impact of earnings in lower tax rate jurisdictions is offset by other items, principally losses incurred in jurisdictions for which we may not able to realize a related tax benefit. Depending upon the jurisdictional mix and amount of our income in 2012, the losses for which we may not receive a tax benefit in 2012 could result in an effective tax rate that is higher than the 35% U.S. federal statutory rate. 

Our effective tax rate is subject to significant variation due to several factors, including variability in accurately predicting our taxable income, the taxable jurisdictions to which it relates, business acquisitions and investments, foreign exchange rates, and expenses or losses for which tax benefits are not recognized. We have tax benefits relating to excess stock-based compensation deductions that are being utilized to reduce our U.S. taxable income. As of December 31, 2011, our federal net operating loss carryforward was approximately $384 million. We also have approximately $273 million of federal tax credits potentially available to offset future tax liabilities. Once we utilize our federal net operating losses and tax credits, we expect cash paid for taxes to significantly increase. As a result of U.S. legislation enacted in December 2010, we accelerated our depreciation deductions for qualifying property acquired in 2010 and 2011. 

Equity–Method Investment Activity, Net of Tax 

Equity–method investment gains (losses), net of tax, were $(12) million, $7 million, and $(6) million in 2011, 2010, and 2009. The