All Things
Paying big business to send jobs off-shore.
Would you believe it? The US government, the government you and I elect, has had a tax policy for 50 years or more that encourages companies to send jobs off-shore. President John F. Kennedy spoke out against it in 1961. But nothing happened.
A company--GE and IBM are examples--may build a plant in Asia and produce products previously produced at home. American workers lose their jobs.
One reason for doing that is, obviously, that wages are higher in the US than anywhere else in Asia. But there are other benefits. The profit IBM makes from its foreign subsidiary are tax free as long as the money remains outside the US. If IBM has a profitable operation in Taiwan or in Thailand, they only pay taxes on those profits if they send them home. If they use them to invest in Taiwan or Thailand or anywhere else outside the US, they pay no taxes to Uncle Sam. Not only is there a tax incentive for producing goods abroad and thus shipping jobs out of the country, but there is also a tax incentive for re-investing their profits abroad and not here at home where it would create more jobs.
USA Today reports that “From 2000 through 2005, U.S. multinationals eliminated 2.1 million jobs at home while adding 784,000 to their payrolls abroad, according to the Bureau of Economic Analysis. At the end of 2005, the most recent statistics available, U.S. corporations employed almost 9 million people outside the United States.”
During the campaign and during the early weeks of his administration, Pres. Obama promised to reform the tax code. Multinational corporations, the US Chamber of Commerce and other have been lobbying furiously against this change in the tax code. So nothing may come of it.
The government--your and my government--will continue to reward large American corporations for job creation elsewhere while taking work from American workers and bread out of the mouths of their families.
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p { margin-bottom: 0.08in; } Oh, no! The Debt. In the current year the Federal government takes in $2.5 trillion. But it spends $3.6 trillion. It must borrow $1.1 trillion on top of the $14 trillion we owe already. Let's put that in terms...
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p { margin-bottom: 0.08in; } p { margin-bottom: 0.08in; } Taxes It's tax time again. No one likes paying taxes; everyone feels done to. The news of people who pay no taxes sells a lot of newspapers. What is really going on? General...
- How To Deal With Undocumented Immigrants
How to deal with undocumented immigrants. The debate over undocumented immigrants is fueled by economic self-interest of employers, by the fear held by low wage American workers of the economic competition from undocumented workers, by the interests of...
- One Perswon's Private Property Is Another Person's Unemployment
Many people believe that it is free enterprise – the single-minded pursuit of private profit-- that makes our country great, that gives us a high standard of living. But along comes the Simmons Mattress company forced into bankruptcy by several private...
- Undocumented Workers
May 1 has come to be one of the days when the advocates of undocumented workers demonstrate their support for immigrants. It is also a day for their opponents -- mostly persons who feel threatened by the job competition of the immigrants -- to emphasize...
All Things
Paying big business to send jobs off-shore.
Would you believe it? The US government, the government you and I elect, has had a tax policy for 50 years or more that encourages companies to send jobs off-shore. President John F. Kennedy spoke out against it in 1961. But nothing happened.
A company--GE and IBM are examples--may build a plant in Asia and produce products previously produced at home. American workers lose their jobs.
One reason for doing that is, obviously, that wages are higher in the US than anywhere else in Asia. But there are other benefits. The profit IBM makes from its foreign subsidiary are tax free as long as the money remains outside the US. If IBM has a profitable operation in Taiwan or in Thailand, they only pay taxes on those profits if they send them home. If they use them to invest in Taiwan or Thailand or anywhere else outside the US, they pay no taxes to Uncle Sam. Not only is there a tax incentive for producing goods abroad and thus shipping jobs out of the country, but there is also a tax incentive for re-investing their profits abroad and not here at home where it would create more jobs.
USA Today reports that “From 2000 through 2005, U.S. multinationals eliminated 2.1 million jobs at home while adding 784,000 to their payrolls abroad, according to the Bureau of Economic Analysis. At the end of 2005, the most recent statistics available, U.S. corporations employed almost 9 million people outside the United States.”
During the campaign and during the early weeks of his administration, Pres. Obama promised to reform the tax code. Multinational corporations, the US Chamber of Commerce and other have been lobbying furiously against this change in the tax code. So nothing may come of it.
The government--your and my government--will continue to reward large American corporations for job creation elsewhere while taking work from American workers and bread out of the mouths of their families.
-
p { margin-bottom: 0.08in; } Oh, no! The Debt. In the current year the Federal government takes in $2.5 trillion. But it spends $3.6 trillion. It must borrow $1.1 trillion on top of the $14 trillion we owe already. Let's put that in terms...
-
p { margin-bottom: 0.08in; } p { margin-bottom: 0.08in; } Taxes It's tax time again. No one likes paying taxes; everyone feels done to. The news of people who pay no taxes sells a lot of newspapers. What is really going on? General...
- How To Deal With Undocumented Immigrants
How to deal with undocumented immigrants. The debate over undocumented immigrants is fueled by economic self-interest of employers, by the fear held by low wage American workers of the economic competition from undocumented workers, by the interests of...
- One Perswon's Private Property Is Another Person's Unemployment
Many people believe that it is free enterprise – the single-minded pursuit of private profit-- that makes our country great, that gives us a high standard of living. But along comes the Simmons Mattress company forced into bankruptcy by several private...
- Undocumented Workers
May 1 has come to be one of the days when the advocates of undocumented workers demonstrate their support for immigrants. It is also a day for their opponents -- mostly persons who feel threatened by the job competition of the immigrants -- to emphasize...