So, sometimes, you wade into a fight that just isn't fair. Here is one of those fights on economic policy--one that boils down to a massive scam on the part of Flagless Corporate-Land aimed at ripping off those of us who still pay taxes. And this is a scam that is being aided and abetted by a whole host of Democrats, including a think-tank that bills itself as "center-left".
The scam is something I've written about a number of times. It's called "repatriation" of profits. It goes something like this: "we (meaning, big corporations) made a whole bunch of money overseas and we've parked it over there because we didn't want to pay our fair share of taxes. But, out of the goodness of our hearts, if you give us a tax break, then, we will bring the money back to help all our poor citizens". Instead of paying the 35 percent corporate tax rate, these corporate evaders want to pay 5.25 percent--which is almost free money.
Such a deal. Since the corporate lobbyists need some "intellectual" argument to justify such a bald-faced scam masquerading as something "good for the economy" in an economic crisis, they turned to the New Democratic Network. NDN produced what can be charitably called a fig-leaf "study" for the robbery of the U.S. Treasury.
In explaining why the corporate raid of the Treasury makes sense, NDN President Simon Rosenberg gives us a scarily Orwellian defense of why we will actually gain revenue, not lose:
With the fast-rising consumption across much of the developing world, there is no doubt that successful globalized American corporations will draw increasing shares of their sales and profits from outside the United States, by competing successfully with other global companies from many other countries. Our current tax system wasn’t really built for this economic reality, and this suggests how much we need a major overhaul of our corporate tax system to accommodate how American and global business is actually conducted today.
Second, while temporary fixes are not the best public policy options, on balance enacting a new round of “repatriation tax relief” makes sense. Bringing hundreds of billions of dollars from oversees back into the US can only help our economy right now. And as our new study shows, doing so should not cost the American taxpayer over even ten years. In fact it should bring additional new revenue into the Treasury. Given this, our elected leaders in Washington should give this approach serious consideration this fall as they consider additional, fiscally-responsible steps to bolster the economy.
Really? Now, that is a brilliant, concise window into the Serious People, corporates-speak that has infected our national policy and fuels the class warfare. You see, plebes and working stiffs who pay taxes, this is the New World. And you need to understand that in the new reality of the New World these are the rules:
1. Everyone has to accommodate the needs of big corporations and the drives to rake in profits, no matter the consequences.
2. If you want to hide robbery, you use the words "fiscally-responsible" because anyone who,then, opposes "fiscally-responsible" robbery is not a Serious Person.
Even if the pesky facts get in the way. Pesky facts put forth by the Citizen for Tax Justice, which, unlike NDN, does not see the need to sacrifice principles and facts in the service of an argument on behalf of the Flagless Corporate-Land. To wit:
The twenty companies that repatriated the most offshore profits under the temporary
repatriation amnesty enacted by Congress in 2004 now have almost triple the amount of profits “permanently reinvested” (i.e., parked) overseas as they did at the end of 2005.
The figures call into question a recent report from the New Democrat Network (NDN), which assumes away the likelihood that a tax amnesty for repatriated offshore profits ultimately encourages corporations to shift more of their profits and operations to other countries.[emphasis added]
Now, why would CTJ say this? Because we've seen this picture before:
The corporations, which include well-known companies like Pfizer, Merck, Hewlett-Packard, Coca-Cola, Citigroup, McDonald’s and many others, collectively had $269.6 billion in “permanently reinvested earnings” parked offshore (largely in tax havens) at the end of 2004. This offshore hoard shrank as expected in 2005, to $152 billion, after these companies repatriated most of it in response to the tax amnesty. But their offshore hoard immediately climbed to new highs in the years afterwards, reaching $426.5 billion in 2010...
The non-partisan Congressional Research Service (CRS) later concluded that the amnesty measure failed to create jobs, which was Congress’s ostensible intention.1 CRS concluded that the repatriated profits largely went to the companies’ shareholders in the form of increased stock dividends and stock buybacks, rather than towards job creation an investment in the U.S.
[emphasis added]
Translation: those corporations lied about what they would do in 2004, then, turned around and hid more money overseas and now they want to play us like fools again.
Here is the killer point in CTJ's critique of the NDN pile of crap:
The NDN report makes no real effort to refute studies concluding that the benefits of the 2004 amnesty went to shareholders rather than towards job creation[bold in the original].
The NDN authors acknowledge (on pages 5-6) studies finding that the amnesty was associated with increased dividends and stock buybacks. The study they cite to support a link with increased investment and job creation is a survey of tax executives of the corporations benefiting from the amnesty. [italics was in the original, bold emphasis added]
Let's get this straight: this "think-tank" did a study that presumably positions itself as "objective"--and it gets its data from the very people who have an interest in spinning the 2004 scam (demonstrated by the non-partisan CRS as a scam) as benefiting the public.
You can't make this up.
Now, if you are scratching your head about how this "center-left" think-tank can come up with such unadulterated garbage, consider:
The study was conducted by Dr. Robert Shapiro, Chair of NDN’s Globalization Initiative, and former Under Secretary of Commerce for Economic Affairs in the Clinton Administration, and Dr. Aparna Mathur, resident scholar at the American Enterprise Institute.
Mathur's affiliation with AEI speaks for itself. Shapiro, per his bio, is a consultant for a whole host of companies, and, as important, has a long track record for working in the government advancing "globalization" policies like so-called "free trade" that have at their core the lowering of wages around the world.
By the way, there is a better solution advanced here by Business and Investors Against Tax Haven Abuse.
So, bottom line: who would you believe? One of the leading progressive authorities on taxes (CTJ), whose data, by the way, is rarely if ever contested even by its opponents OR two people who work for a "center-left" organization who have a demonstrated record of being whores for the corporate agenda?