Cut Corporate Tax Rates......not without something in return

Discussion in 'Economics' started by hayman, Sep 5, 2011.

  1. hayman


    I love the politicians (not !) who claim that the way to dig out of our current economic crisis, is to cut the corporate tax-rates carte-blanche. Such a move would be great for Wall Street, but not main street. Cutting Corporate Tax Rates would surely increase the bottom line for corporations, and would accelerate the ascent of our stock markets, but would do little to nothing to stimulate jobs growth. Corporations would continue to sit on their stockpile of cash, and would continue to outsource jobs across our borders. The only thing that would change with decreased corporate tax rates, is that corporations would become infinitely more profitable. This does little for the average American, but of course, would be a boon for Wall Street.

    What I have failed to hear from any of the Republican "candidates" or from our current administration, is to provide Corporate tax rate cuts for companies that ONLY create jobs in-house; i.e., create jobs domestically. This seems like a no-brainer win-win scenario - create jobs in the U.S., which will have a direct impact on consumer spending (and direct impact on our economy and needed revenue generation), and will benefit the corporations, tax-wise, that create these jobs.

    Why on earth should we consider lowering tax rates for corporations carte-blanche, without asking for something in return that will benefit our economy ? Could it be that our politicians ONLY work for Wall Street, and could care less about Main Street ?
  2. the1


    Little to stimulate job growth? So much of American jobs is going overseas because of the high corporate tax rate. Without going into a lengthy rip on the topic, do a bit of research on exactly how Ireland rescued their economy from the dogs.

    Multi-nationals pay next to nothing in the way or US Tax as it is. Lowering the tax rate would have nearly no effect on tax revenues from Corporations, and would <b>increase</b> tax revenues from individuals as they go back to work. Aggressively lowering the Corporate Tax Rate is the absolute <b>BEST</b> thing the US could do to stimulate job growth.
  3. 100% correct! I'd go even further and punish those that continue to downsize and outsource by raising their tax rate and being under a continual IRS audit. Hire here, get a tax break. Don't...pack your shit and go. Don't let the door hit you in the ass, and take your f'n flag lapel pin with you.
  4. Corporate taxes are among the highest in the world.

    Debt to GDP ratio is also among the highest. In other words, America does not look like a good investment. It's balance sheet is flopping like a fish out of water.
  5. the1


    There's nothing to prevent a US corporation from completely moving 100% of their assets overseas permanently. Imagine Cisco becoming a Swiss company rather than a US one. The US has the highest Corporate Tax Rate, second only to Japan. I don't think this graph is 100% correct but it gives a good enough idea of the situation.


    Edit: This graph gives a better illustration of the tax rates compared by country and then there's the state tax rates that have to be considered. Corporations have a heavy incentive to move their operations overseas.

  6. Good! Then I would put a 1000% tax on all their products. That would give room to another U.S. based company to fill the need. Let'em all go!
  7. hayman


    Multi-nationals is an entirely separate topic, & certainly needs to be addressed. The fact that Goldman Sachs pays a marginal tax rate of 1 % is obscene!

    Bush economics failed miserably, as lowering corporate tax rates did little to stimulate job growth in this country. Corporations are in the business of making money, not ensuring economic full-employment. If companies can make money with all machines and no employees, they will do it. I do not begrudge that mentality. All I'm saying is that we should only help Corporate profits, if it held the economy. If they aren't helping the economy, then they shouldn't be getting handout subsidies.
  8. Taxes have to come from somebody. The only proposal I've ever read that made any sense at all economically came from the late Hyman Minsky, to wit:

    1 - Eliminate all payroll taxes.
    2 - Eliminate the corporation income tax.
    3 - Make the personal income tax steeply progressive, and of course strictly limit if not eliminate any and all exemptions on this.

    Combined together, this would radically lower the cost of hiring the next employee, eliminate the part of inflation that comes from the increased cost of the corporate income tax, while still giving you a reasonably equitable tax structure and one that would automatically act as a stabilizer for both good and bad times.
    Of course, it will never happen, and even if by some weird miracle something that made economic sense did pass (doesn't necessarily have to be the above, I'm sure there are plenty of other decent ideas out there) it would start to be altered the next day to give a special exemption to some lobbyist's client or some powerful committee chairman's district/state.
  9. the1


    Great plan. So instead of employing 15% of the employees overseas, for example, let's let them employ 100%. Have any idea what it takes for a startup to get to the level of a Cisco? Go to Cisco's website and follow their history.

  10. Ok Captain Morgan.. simmer down.

    It's Obvious you have had too many today...??

    It's only 12:36pm here. (Central Time)
    #10     Sep 5, 2011