President Obama used the idea of “economic patriotism” to push forward his budget, in which he closed one of the tax loopholes that lets companies avoid paying taxes by Romneying themselves to another country just to avoid paying taxes here. That does seem pretty unpatriotic, lazy, and entitled especially since said companies use the resources that U.S. taxpayers fund. It is currently legal to do this, if “you” are a certain kind of big money company.
The President also pushed for business tax reform that would create incentives for companies to create jobs here.
Transcript from the White House:
Hi, everybody. Our businesses have now added nearly 10 million new jobs over the past 52 months. The unemployment rate is at its lowest point since September 2008 – the fastest one-year drop in nearly 30 years. 401(k)s are growing, fewer homes are underwater, and for the first time in more than a decade, business leaders around the world have declared that the world’s number one place to invest isn’t China; it’s the United States of America – and our lead is growing.
None of this is an accident. It’s thanks to the resilience and resolve of the American people that our country has recovered faster and come farther than almost any other advanced nation on Earth.
But there’s another trend that threatens to undermine the progress you’ve helped make. Even as corporate profits are as high as ever, a small but growing group of big corporations are fleeing the country to get out of paying taxes. They’re keeping most of their business inside the United States, but they’re basically renouncing their citizenship and declaring that they’re based somewhere else, just to avoid paying their fair share.
I want to be clear: this is only a few big corporations so far. The vast majority of American businesses pay their taxes right here in the United States. But when some companies cherrypick their taxes, it damages the country’s finances. It adds to the deficit. It makes it harder to invest in the things that will keep America strong, and it sticks you with the tab for what they stash offshore. Right now, a loophole in our tax laws makes this totally legal – and I think that’s totally wrong. You don’t get to pick which rules you play by, or which tax rate you pay, and neither should these companies.
The best way to level the playing field is through tax reform that lowers the corporate tax rate, closes wasteful loopholes, and simplifies the tax code for everybody. But stopping companies from renouncing their citizenship just to get out of paying their fair share of taxes is something that cannot wait. That’s why, in my budget earlier this year, I proposed closing this unpatriotic tax loophole for good. Democrats in Congress have advanced proposals that would do the same thing. A couple Republicans have indicated they want to address this too, and I hope more join us.
Rather than double-down on the top-down economics that let a fortunate few play by their own rules, let’s embrace an economic patriotism that says we rise or fall together, as one nation, and as one people. Let’s reward the hard work of ordinary Americans who play by the rules. Together, we can build up our middle class, hand down something better to our kids, and restore the American Dream for all who work for it and study for it and strive for it.
Thanks, and have a great weekend.
It’s true that companies who know the right people and have enough money can legally pick and choose if they want to pay taxes here even if they actually do business here. Do not try this if you are a person. Do see the Supreme Court about the difference, or lack thereof.
Democrats have proposed closing the tax loophole, but naturally, there is no time for piddling matters of legislation, finance, economics, tax reform, or patriotism when there are Obama witch hunts to be manufactured out of nothing. And now that the taxpayers are paying for Speaker John Boehner and the House GOP to sue the President while they take even more days off, it would be foolish to expect anything from this Congress.
Oh, wait. I stand corrected. Republicans did make time for matters of finance and tax reform. They have been trying to add $310 billion (some say closer to a trillion all told) to the deficit in unpaid for, permanent tax credits for businesses. These tax credits were supposed to be temporary to “stimulate” the economy (trickle down already!) but since they didn’t work according to Republicans, who claim the Obama economy is awful, Republicans figured why not devastate the deficit permanently just in case it might start working (do not apply this logic to “stimulating” the economy with long term unemployment benefits, because this actually works, so naturally it won’t be done). So much for “it must be offset” as an excuse for why Republicans won’t pass legislation. “It must be offset UNLESS it benefits big business.”
It has become quite clear that this Congress will do absolutely nothing except troll President Obama on your dime when they aren’t robbing you blind to make things cushier for their corporate masters, unless and until they are replaced with actual lawmakers who take pride in a days work. We need some economic patriotism, but we also need a little legislative patriotism.