Two news items concerning our beloved leader and business caught my eye today. President Obama castigated big (formerly) U.S. corporations for "magically becoming Irish to exploit the "unpatriotic loophole" and pay less U.S taxes, according to one news item. Some American companies have acquired facilities in Ireland and in a merger inversion have technically moved their headquarters there. This allows them to dodge the highest business taxes in the world (good ole USA) and take advantage of some of the lowest in the world (Ireland's corporate tax rate of 12.5 percent).No good American wants to see U.S. grown businesses move, even just their headquarters, overseas. On that issue I will give President Obama the benefit of the doubt (I mean both the 'good American' and the businesses moving!) However, in Obama's thinking these businesses need to be punished and dragged back to the U.S. so they can be taxed more. This is a natural reflex on his part. Corporations are evil, and profit-seeking is evil. They must be treated as the enemy and controlled by the wise central government for the good of the citizens.
Let's consider Pennsylvania. I have worked with some business organizations over the years in an attempt to reduce the heavy tax burden Pennsylvania-based businesses bear (e.g., we have the second-highest corporate net income tax of any state). The truth is that businesses leave Pennsylvania to other states seeking a better tax (and regulatory) environment. Some businesses that would likely move here for the trained workforce, natural resources, or beautiful winters (a-hem) do not because of the red flags of our tax rates.
I ask you how this is different on a global scale? I can easily see the rationalization of a company in Pennsylvania deciding to move to South Carolina for a better tax and regulatory environment, and similarly it is easy to understand the thinking of corporations looking overseas. If a corporation has a fiduciary responsibility to its stockholders shouldn't it consider the best tax environment - along with all the other factors? Sure the corporation has other stakeholders including employees, communities, and customers to name a few. In the end the financial decisions have to loom big for corporate management.
So Obama wants Congress to work at changing laws that permit these merger inversions or other avenues to bring back the tax revenue from these "unpatriotic" corporations. Locked into his "corporations-are-greedy-enemies-of-the-state" mentality he naturally approaches the issue this way.
Hey, how about the solution we have lobbied for in Pennsylvania. LOWER THE TAXES!! Does it make sense to further chase American businesses with more regulation and government strangleholds (a stick approach)? Or would it be better to offer a more conducive business environment so more businesses could thrive in America (the carrot approach)?
The other nugget I read quoted President Obama as saying corporate America CEO's don't have a right to complain about regulations and should show greater social responsibility. "If you look at what's happened over the last four or five years, the folks who don't have a right to complain are the folks at the top," Obama told the Economist. He expanded on this perspective by saying, "Oftentimes, you'll hear some hedge fund manager say, 'Oh, he's just trying to stir class resentment.' No. Feel free to keep your house in the Hamptons and your corporate jet, et cetera. I'm not concerned about how you're living."
There was a time (during his elections) when Obama carefully guarded his anti-capitalist/ anti-business/class warfare heartfelt feelings. No more. These statements show his blatant envy and grandiose self-empowerment. One of Obama's regular rhetorical techniques is to clearly describe his own (bad) behavior as if coming from the lips of his enemies. Then he ridicules and holds up this thought as absurd. In this case he tells the truth of his actions when he quotes the fictitious hedge fund manager (oh, the vilest, greediest of all capitalists): 'Oh, he's trying to stir up class resentment.' Well, of course this is exactly what Obama is doing. But we're suppose to dismiss this crazy notion because it is coming from the despised hedge fund manager.And do you know what? The evil hedge fund manager has a house in the Hamptons - and you don't! It would be laughable - that Obama immediately engages in his own class resentment after trying to disabuse us of the notion - if he wasn't the President of these United States. But catch this: the hedge fund manager can feel free to keep his house in the Hamptons. President Obama is allowing him, for now anyway, to keep these ill-gotten fruits. How kind of our beloved leader.
Then President Obama offers the biggest, most obvious lie yet: "I'm not concerned about how you're living." Are you kidding me!
