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Blah, blah, blah...the most sickening repetitive nonsense is really the bi-partisan stupidity  politicians show when they open their mouths spewing out Chamber of Commerce falsehoods that tax cuts create jobs, and stumble all over themselves (with visions of corporate PAC checks dancing in their heads) to demand, right now, for the health of the economy, some new idiotic corporate tax cut. And so here's a little actual, uh, research, that proves how false the "corporate tax cuts create jobs" idea really is.

Brought to you by the people at the Center for Effective Government (a new name for OMB Watch which did a lot of great work when my comrade Gary Bass was over there), the report is called: "The Corporate Tax Rate Debate: Lower Taxes on Corporate Profits Not Linked to Job Creation."

It's just worth repeating a few juicy points, and, then, by all means, go over and read the whole thing--and maybe send it to your Congresscritter next time s/he goes gaga over a new Chamber tax cut wet dream:

Our examination of the evidence found no relationship between cutting tax rates on corporate profits and job growth.

We examined the job creation track record of 60 large, profitable U.S. corporations (from a list of 280 Fortune 500 companies) with the highest and lowest effective tax rates between 2008 and 2010 and found:

    *22 of the 30 corporations that paid the highest tax rates (30 percent or more) on their reported profits created almost 200,000 jobs between 2008 and 2012. Only eight of the 30 firms paying high tax rates reported reducing the number of employees between 2008 and 2012.

    *The 30 profitable corporations that paid little or no taxes over three years collectively shed 51,289 jobs; half of these low-tax firms created some jobs, and half shed jobs between 2008 and 2012.

    *Lowe’s, the nation’s second-largest home improvement store, paid over 36 percent in taxes on reported profits of $9 billion between 2008 and 2010, and hired an additional 28,820 employees between 2008 and 2012.

    *Verizon, the nation’s largest wireless provider, reported $32 billion in U.S. profits between 2008 and 2010, yet received tax refunds totaling $951 million and reduced the number of employees by almost 56,000 between 2008 and 2012[emphasis added].

Corporate tax rates are too low. That's it. And the whole scam which had led to the draining of billions of dollars, partly to fund obscene CEO pay and benefits, has been based entirely on ideology not facts, and accomplished not on the merits but just simply on pure check-writing by lobbyists and corporations to idiotic politicians. Did I make that subtle enough?
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Comment Preferences

  •  Corporate tax rates are a very complicated issue (3+ / 0-)
    Recommended by:
    VClib, oldpotsmuggler, JerryNA

    Compare todays rates to pre 1970: well in the post war era, the US sold everything for the world. After 1965 trading started to resume normal patterns.

    Over the last 30 years we have a different corp tax landscape, C-corps, S-Corps.

    Todays corp tax landscape is filled with offshore havens, raising rates means that money stays offshore.

    GE is the number one wind turbine manufacturer in the world, with a 60% made in the US content.

    DO we want to raise taxes on GE, potentially driving that work offshore? HEll no.

    The real difference makers when it comes to
    US jobs is the 1986 Tax reform Act. People used to get tax breaks for long term domestic investment; And the tax breaks for offshoring.

    We should use tax breaks to reward good behavior, and discourage bad behavior. And prior to Reagan the overall tax code did just that.

    .................expect us......................... FDR 9-23-33, "If we cannot do this one way, we will do it another way. But do it we will.

    by Roger Fox on Fri Dec 06, 2013 at 05:58:03 PM PST

  •  The US statutory corporate tax rates are too high (2+ / 0-)
    Recommended by:
    coffeetalk, Calamity Jean

    and the effective rates are too low. That's what we should work on.

    "let's talk about that"

    by VClib on Fri Dec 06, 2013 at 06:20:07 PM PST

    •  I can't help but think that (1+ / 0-)
      Recommended by:
      Calamity Jean

      every dollar that these tax avoiders don't pay, you and I have to foot the bill for.  A modest proposal.  Let's eliminate all tax breaks and replace them with a system of tax rebates.

      Any difference between the statutory and effective rate should be treated as a government expenditure which needs to be disclosed as a public subsidy. If corporations, and wealthy individuals, had to lay out the reasons that we are paying their taxes, I think it would rein in some of the more blatant abuses.

      Let's make everyone pay the statutory, and then have any government support for industry be given in the form of a rebate, which most be publicly disclosed in an openly accessible manner. (Like a website.)

      http://www.economicpopulist.org

      by ManfromMiddletown on Fri Dec 06, 2013 at 08:44:47 PM PST

      [ Parent ]

  •  Corporations primarily staff based on demand (3+ / 0-)
    Recommended by:
    JerryNA, kurt, Calamity Jean

    For example, I work in the air freight business.

    If the freight isn't there we're not going to buy more airplanes and hire more pilots to haul the freight that isn't there just because we got a tax cut.

    If the pilot's good, see, I mean if he's reeeally sharp, he can barrel that baby in so low... oh you oughta see it sometime. It's a sight. A big plane like a '52... varrrooom! Its jet exhaust... frying chickens in the barnyard!

    by Major Kong on Fri Dec 06, 2013 at 07:25:05 PM PST

  •  Corporate tax hell, my taxes are too low n/t (0+ / 0-)
  •  It would be very interesting (0+ / 0-)

    to extend this analysis, with 500 cases in the CTJ data this would allow for precise estimate of both whether a relationship exists, and how strong it is.

    There is now freeware out there which would allow a regression model to be run on this.  

    That would give: 1) an estimate of the strength of any relationship, ans 2) and estimate of the impact that each increment of tax cut has on employment growth.

    The measure of relationship in a regression model is R2, which says how much of the variation in employment can be attributed to the variation in taxation. This runs from 0 to 1, with 0 meaning there is no relationship, and 1 meaning that the only thing effecting one is the other.  So we can now just how important the relationship between two variables is.

    The regression coefficient gives a precise estimate of the impact of one variable on the other.  With a regression model, if there is a relationship, we can scientifically predict how much a given increase in one variable would impact another.  So in this case, we could actually give a prediction saying that a x% increase in taxation should result in a y% change in employment.  

    This would put the conservative claim that tax cuts lead to increased employment to an empirical test. Damn, someone should do this.  It's a much more precise measure that comparing the top 30 and bottom 30 companies.

    http://www.economicpopulist.org

    by ManfromMiddletown on Fri Dec 06, 2013 at 09:19:00 PM PST

  •  First diary I've rec'd in days (1+ / 0-)
    Recommended by:
    Calamity Jean

    ..or not, I don't recall..

    Corporate tax rates are too low. That's it.
    "GloboCorp" needs to be reined in before the reign begins in earnest. It'll be raining old, fat, white men chomping cigars and looking like a monocle-clad character out of a must old old Monopoly game-set otherwise.

    It's actually pretty bad already, compared to the good-old-days. Citizens United and the PACs have me watching my country unravel at the seams incoherently, and here comes another treaty to undermine me and mine a little bit more. It's surreal.

    The TPP as far as I can tell is a game-changer. On the way..
    Screwed, Blued, and Tattooed.

  •  Not surprising. (0+ / 0-)

    However, let me suggest two things to your consideration.

    The Chamber of Commerce folks consider themselves to be very important people by virtue of the fact that they recruit most of the Con candidates for public office. They probably see themselves as a private sector variant of state and national governing bodies and, as such, they see themselves as middlemen in competition with those bodies for the same dollars. That Congress actually originates all dollars does not occur to them because Congress has been pretending, for about a hundred years, not to have that responsibility. So, there's a practical, albeit false reason for the Chambers' position.

    My second point is also related to the direction in which the flow of currency actually occurs -- i.e. from Congress to the private sector. It's like springs that start at the tops of mountains as a trickle and then turn into a rushing river. Congress has not only been at pains to argue the reverse, but in failing to appreciate that federal taxes are nothing but a mechanism for bringing dollars back (revenue) to the start, Congress has managed to slow the transit of dollars to a slow crawl. It's as if the trickle had been reduced to a drip and then, with the shut-down, an effort to shut the whole thing off.
    Even though the Federal Reserve keeps pouring in more and more dollars, the banks are reluctant to spread them around in the economy because Congress keeps threatening to cut off the flow. Congressional rationing makes the Congress critters feel important, like parents being able to send the kids to bed without dinner, but it plays havoc with our economic health.

    In a sense, the economy is like a car -- easy to stop; hard to start again, especially when you've thrown sand in the gears.

    Obamacare at your fingertips: 1-800-318-2596; TTY: 1-855-889-4325

    by hannah on Sat Dec 07, 2013 at 02:21:09 AM PST

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