Corporate Tax Rates and American Competitiveness
http://thedianerehmshow.org/shows/2012-02-23/corporate-tax-rates-and-american-competitiveness
Jason Dirks via Flickr:http://www.flickr.com/photos/jasondirks/
The Obama administration proposes lowering corporate tax rates but eliminating many popular deductions: what the plan would mean for overall tax revenues and American competitiveness.
Guests
Edward Kleinbard
professor of law,
University of Southern California Gould School of Law
Isabel Sawhill
senior fellow, Economic Studies, The Brookings Institution.
Siobhan Hughes
reporter,Wall Street Journal
Peter Morici
professor of International Business at the University of Maryland, former director of economics at the U.S. International Trade Commission.
Comments
Please familiarize yourself with our Code of Conduct and Terms of Use before posting your comments.
Is it possible to take president Obama serious on any proposal he puts forward as well meaning legislation at this point? After all he had two years with both houses of Congress on his side and chose not to help the economy recover but instead focused on pet projects for the sake of vanity (health care reform) to feather his hat! The country voted for change but all the country got was more big government progressive ideas that are sure to sink us further in debt, we certainly did not need the resurrection of failed liberal ideas that were gathering cob webs in the closets of every left wing think tank. The stimulus turned out to be is mostly party favors to union donors and democrat party insiders. Anything he attempts at this point with legislation is nothing more than political ruses to sway gullible voters, he knows his underhanded attempts to increase taxes on business are dead on arrival, it's all patently obvious as cheap gimmickry to lure votes.thx
Not a fan of lowering corp tax rates.
U.S. Corp rates some of highest in world?
Maybe, but we all know they pay MUCH less than 35%. Some pay zero. Some industries are subsidized.
25% is the rate in effect just before the Great Depression.
As a strategic move, it may be wise one for Obama though, because he is proposing rates along lines that GOP wants, therefore "stealing their fire" on the issue.
The administration's proposal is revenue-neutral (something maybe you didn't notice, Drew?) - offsetting cuts with other measures including a tax on foreign profits, simplifying small business tax filing...
and by closing a bunch of accounting tricks (even if they'll find new ones). The effective tax rate's long been going downhill, now sunk to 12.1% this year - the lowest in 40 years while corporate profits are at a 60 year high. (Congressional Budget Office and Wall Street Journal figures)
I like the specifics of the proposal that I've seen so far...
Tax reform enjoys wide bipartisan support across the spectrum? Hope to hear some good analysis on this excellent show.
Just maybe, they could pay for the use and maintenance of our port facilities, the access roads to and from, the wear and tear, etc., the normal costs they would cover and take pride in on their gated estates. But, we, the 'undeserving poor', especially in Jim Crow Virginia, continue to have substandard maintenance of roads so we can escape the next Katrina on the Chesapeake. While our Job Creating Governor, creates jobs all right, the job of all the rest of us to clean up after them, to be stuck in the Port City of Mermaids, while he and his minions are free to leave when it is convenient, from their river side locations, or whatever. The wives and families of the Navy want to be able to get out of here without being run over by the Oblivious Class, the world renowned, Virginia Gentlemen and their Consorts, arm candy, etc. They can't see anything thru their Cohiba smoke. Please, people of the Heartland, help before our Flag lands in the puddle.
The Deserving, Sweet-smelling Fine Folks of Virginia, are splashing us bus-takers as they carry-on with their graciousness. Sic Semper Typranus. Commonwealth of Virginia
This plan seems distinctively pro-business and good for the economy. It would provide economic benefits for actual job creators. What straws will the Republicans grasp while trying to defeat the President’s proposal?
I don't know of many union donors and democratic insiders in the Wall Street industry that received a huge portion of the stimulus. You may be just a tad clouded by your obvious political beliefs.
If the loopholes for corporations are closed, I predict:
Once a lowered rate goes through, bit by bit, inch by inch the loopholes will reappear as time goes by.
Trevor Rosecrans wrote:
"I don't know of many union donors and democratic insiders in the Wall Street industry that received a huge portion of the stimulus. You may be just a tad clouded by your obvious political beliefs."
Maybe the G.M. government takeover, Solyndra, G.E. Teacher Unions through the bail outs of states and on and on.
And of course, the nay-saying Republicans were only interested in the general welfare of ALL the taxpayers of the U.S. during that oppressive two year period. What you fail to note Bill is simply having a majority doesn't automatically translate into a dictatorship. Compromise and cooperation are needed among elected officials. The government is not a hierarchal system like corporation; the lowliest Senator can grind the entire process to a halt.
As to the results of the stimulus, you might want to research its effects other than the Wall Street Journal's editorial pages or listening to hate radio. Credible economists have shown it did have an effect, which is to keep the entire system from collapsing. That it didn't cure every economic ill in a couple of weeks shouldn't be a surprise. As an illustration, if a person had a massive heart attack but managed to be saved by the EMTs using CPR and getting them to the hospital, would their effort be considered a failure if the patient wasn't running a marathon in a month?
This kind of thinking is delusional at best.
It's not in businesses mission to "create jobs". It's their mission to make money for their stockholders. We can cut taxes down to nothing, and it won't make them return jobs that they've outsourced to the US. That will only happen when the so-called conservatives have eviscerated out labor unions and reduced our rate of pay to the point where they match those of countries like India and China. And also, when they remove the safety protections and human rights that we've worked so hard to gain.
So I'm not buying the whole "be kind to the job creators" argument.
Greater efficiency would be if public corporations were taxed on pre-tax book income. Economic tension would be created between a company's desire to report high earnings to their shareholders and pay lower taxes. Furthermore, corporations would not need large tax departments to compute taxable income and the tax liability. Financial statements wold become less complex with the disappearance of the poorly understood "deferred tax" costs and liabilities. And, marginal corporate tax rates could be reduced.
As the CEO of a smaller business, I view this proposal in a generally positive way. I am greatly encouraged to see the preferential rates for manufacturers, but it will be critical to see how "manufacturing" is defined. Do you need to actually fabricate the pieces and parts with direct employees at your location OR can a company function in a virtual manner, still branding the product as your own, but spreading the fabrication requirements to outside vendors? The days of a company turning and burning all product components, then placing in a box and shipping are rapidly waning. We utilize local (St.Louis) resources for many of these functions, but minimize our capital formation requirements by not having to build what would ultimately be manufacturing capability that would be redundant to regional capacity and output.
There is an interesting phenomenon of cognitive dissonance when an ideologue receives information that discredits their chosen candidate, they don't accept it no matter how truth-full or fact filled the information.
Love your show. I agree with the president on the lowering of the cooperate tax rate providing that other write offs and subsidies that they currently recieve is either eliminated or drastically reduced. As to those that move their operations overseas, they should not recieve no benefits from the US tax payer or system as they are already recieving this from the country to which they moved their business through concessions, tax holidays etc.. I know this first hand from living in a country (Belize) where some US manufactures had operations and enjoyed these benefits.
The tax structure should be modified to shift economic incentives towards longer term time horizons.
This would that diminish the "I'll be gone you'll be gone " mentality, which springs from an over-emphasis on shorter term rewards, a situation which now tends to make it more difficult to take such a longer term focus, and to pass tax reform along such lines.
In some way, short-term incentives need to be used to undermine that very short-termness.
I am tired of complaints about corporate double taxation. Corporations are publicly granted licenses to limit investor liability from the wrongs performed by the company, I see nothing wrong with requiring extra payment in exchange for that protection.
If I may comment from the peanut gallery, I believe there are three critically important numbers to be considered for taxation--cost to live, cost of government, and the point at which more income does not impove one's quality of living. Why is this final number not often considered?
Wait, did I hear the 'Gentleman" being 'offended that Obama is thinking about 'SOCIAL Rate of RETURN, instead of "PRIVATE Rate" Oh, let us Reverence you right now, Oh, you K Street one, blessed by your 'specialness' and need for privacy.
Oh, we can't have any of that 'SOCIAL RATE OF RETURN", now can we.
It must be private, for those who get a percentage, and pass out priveledge, if your are a good boy or girl. Special Degrees in this ability to "Distribute to the Deserving", and "Ignoring the Undeserving", can be obtained at Regent, Liberty and other Marketing Universities.
SOCIAL GOOD, we can't have it. Not in our personal church, not in our gated neighborhood. We must PRESERVE the Preferences of The Virginia Gentlemen, those little Scalliwags, little rascals. They is just mischievous.
Listening to all the debate about who should pay what rate reminds me of an old joke about a man who went to his priest and made a promise to the Lord. Lord, he said, if you will just let me be successful I promise I will always pay ten percent of my income in tithes. Well, the man became successful beyond his wildest dreams, a multi-billionaire. But one day he realized how much he was paying in tithes now and was horrified at this huge amount. So he went back to the priest and said "Father, please, you have to help me, I just can't afford this any more. Please help me to get out of this promise!"
"Well," the old priest replied "I can't help you with your promise, but I'll tell you what I can do. We can pray to the Lord together, and ask him to reduce your income back to where you can afford your tithes again."
I appreciate the dept of discussion on all topics covered on the show.
I am greatly concerned that one of your guest referred to President Obama as "that man".
Should not guest be challenged when they demonstrate this level of disrespect for our nation's leader?
Can we disagree without demeaning our own standards of conduct or discussion?
Could your panelist PLEASE refer to President Obama as "President?" I find her referral to him as "Mr." demeaning.
My two cents worth: congress is so corrupt and full of lobbyists that nothing will be done to protect the middle class from the greed of the rich/corporations.
thank you.
The fury and hatred in the voice of you conservative guest this morning, when he discusses President Obama, is revolting. It is not going unnoticed by your listeners. http://www.filthyliberal.com
Every day we allow Corporations to take center stage and whine,the plight of the American citizens goes ignored.
Don't demean another. Be productive.
Longfeather:
Angry much?
Bill - Baloney. Your post is rife with paid talking points for the land of Conservatopia. We have a country that has a broken economic system, broken by implementation of conservative policies for 30 years. It's HIGH TIME to start doing progressive policies for at least a decade or more. Your ideology ruled for 30 years and destroyed the USA. Return to that ideology for more policy fixes? The term "insane" springs to mind. http://www.filthyliberal.com
We clearly heard the representative for the Oil and Gas Inc and noticed his demeaning manner to our President.
Malaika - I'm sick of it too. I'm disappointed "the host" doesn't sharply correct him, but then the quality of NPR has been going down for years now and they continually allows guests to walk on the President and any non-conservative. It deeply saddens me. http://www.filthyliberal.com
I agree with others...Could you please request that your current panelist act respectfully while on air? Her continual referral to the President of the United States as Mr. Obama is offensive and inappropriate. It also discredits any argument she has to make. To continually disrespect President Obama's status by referring to him as Mr., at a minimum is unpatriotic, but more realistically sounds racist. I think her continual referral to him as Mr. Obama causes harm well beyond the reach of your audience.
Hobbs - I'm saddened Diane doesn't correct him. She's allowing him to bully her and disrespect our President at the same time. He'll continue and get worse as he discovers how much he can get away with. http://www.filthyliberal.com