The High Cost of Stupidity

National Review ^ | December 16, 2015 | Kevin D. Williamson

[expat_panama]

When politicians try to tax corporations to death, the corporations are likely to take rational action.

What would the U.S. economy look like if there were eleven new companies the size of Pfizer?

A little back-of-the-envelope math: If those eleven companies each employed about the same number of people as Pfizer, that would be the better part of 1 million new jobs, which would take care of about 13 percent of those Americans currently jobless-- and if they got nice Pfizer wages, too, so much the better. There would be an additional $2.1 trillion in the pension funds and individual retirement accounts invested in those companies' shares. If those firms paid taxes comparable to Pfizer's, their annual tax payments would exceed the annual total revenue of...

[snip]

But we aren't getting eleven new Pfizers. In fact, we're losing the Pfizer we have.

Pfizer is merging with a smaller Irish pharmaceutical company, Allergan, and the legal headquarters of the new enterprise will be located in the Republic of Ireland rather than in the United States. The main reason for this is the U.S. corporate tax, which is effectively the highest in the developed world (it is exceeded on paper by the corporate tax of one very poor country, Chad...

[snip]

Merging with a small firm overseas and relocating the corporate headquarters to a friendlier tax environment is called a 'corporate-tax inversion,' and the maneuver, though entirely legal and ethical, cheeses off the sort of people who'd like to get their hands on a chunk of that corporate cash and use it to fund favors for their political supporters. (Also legal, though not obviously ethical.)

[snip]

Capital just wants to be loved. It will go where it is most welcome. And try as they might, the politicians can't stop it.

[expat_panama]

Hillary and a lot of freepers are saying that creating wealth and trying to keep it is 'un-Ameircan' and they want government to get big enough to stop it. The Soviet Union was as big as they get and they used to machine gun down folks fleeing across no-man's land. It didn't work.

[dp0622]

i cant imagine what the “incentives” would have to be to match practically 3rs world country pay rates.

the price of a stock used to be ONE marker of a US company’s success.

Its importance to the community and the country counted for something way back when.

Stock options destroyed this. Ask Carly, who “sold” equipment with loans from her own company!! then made off with millions and touts it as success, even when these companies couldn’t pay off their debt.

Same with the housing sales crisis.

A certain amount of patriotism used to be instilled in companies here.

For the most part, it’s gone.

[expat_panama]

Happy Thursday Confirmed Uptrend Day everyone!  IBD flipped their outlook back up yesterday as stocks soared after the Fed ended QE.   Wait, that was years ago and the market soared --just like ending TARP before it.  So much for Rush's stocks=FEDmoney blather.  What really just happened was the Fed bank rate was doubled to fight the run-away inflation we got and cool our over-heated exploding economy.  So much for Yellen's ObamaWonderful blather  (More at.Janet Yellen Is Trying to Slow Economy. Why? - Annie Lowrey, New York).

Anyway futures heat map's got stocks +1.11% and metals +1.54% (btw, gold & silver are back up within their recent price ranges again).

Lot's more reports too:

8:30 AM Continuing Claims
8:30 AM Current Account Balance
8:30 AM Initial Claims
8:30 AM Continuing Claims
8:30 AM Philadelphia Fed
8:30 AM Current Account Balance
10:00 AM Leading Indicators
10:30 AM Natural Gas Inventories
 

[expat_panama]

...patriotism used to be instilled in companies here.   For the most part, it's gone.

Right, the President's the leader of the free world so anyone w/ a business should either give everything to him or go to jail.

[bert]

so, the rate change has been mostly discounted. If it stays the same or if it is raised, the market goes up

the same can be said about Obama....... America has been discounted by a world that sees a Republican taking charge. Meanwhile, Russia and the Arabs are going to deal with ISIS and maybe allow Obama to be a part of the deal.

[dp0622]

sorry, dont understand your statement at all.

[RFEngineer]

“A certain amount of patriotism used to be instilled in companies here.

For the most part, it’s gone”

Companies are not milk cows for every socialist program a government may choose to implement.

If you think there is a patriotic obligation for companies to fund the crap that our government spends their money on, your own patriotism fails the reasonableness test.

Patriots are NOT obligated to fund socialism and tyranny. Quite the opposite.

[AustinBill]

This must be why National Review is endorsing the candidate who's done most to highlight corporate inversions and the issues associated with the current US corporate tax code?

[expat_panama]

dont understand your statement

That was my bad, I was being sarcastic but I'd forgotten to reset my browser...

--there, now it should make sense.

The topic of the thread is inversions, how some people say they're 'unpatriotic', and the fact that people who create businesses are fleeing the U.S. because of the war on business that the left is waging.  imho, when someone tries to rob you and you don't want to be robbed it has nothing to do w/ patriotism.  It's survival.

[Lurkina.n.Learnin]

I saw that headline and thought this was going to be a story about anyone who thought Paul Ryan was going to lead us through some sort of conservative revolution in the kleptocracy of D.C.

[expat_panama]

That’s why I read the thing, there are soo many kinds of very expensive stupidity. Like, I was thinking about this girl I once dated that I was stupid to spend all my money on but then again...

[BfloGuy]

i cant imagine what the “incentives” would have to be to match practically 3rs world country pay rates.

The Irish don't make "third-world" pay. The taxes are the incentive.

[citizen]

“The High Cost of Stupidity”

Now your talking to the right audience! ;)

[dp0622]

what’s the incentive for investment banks to send out work to India for their presentations department. Of the work is horrific. So it seems to me that they’re willing to take incredibly poor quality to save money, which is foreboding

[dp0622]

I’m not that sharp lol. Yeah but the whole stock option thing makes people do things like Carly did, which is basically illegal. I understand where you are coming from though.

[dp0622]

you got me. Based on that one single piece of evidence you proved beyond all shadow of a doubt that I’m. Not a patriot. Make sure those in charge of the board know since it sounds like you’re in charge of finding the unpatriotic people on here

[dp0622]

by the way I guess you considered what carly did to be patriotic. Giving loans to companies to buy your product and then fleeing with stock options before the Loans are delinquent. that’s your kind of patriotism right there

[RFEngineer]

“it sounds like you’re in charge of finding the unpatriotic people on here”

Sounds like a guilty conscience, more than anything.

[RFEngineer]

“that’s your kind of patriotism right there”

Are we going to make CEO’s “enemies of the State” or are we going to just let them run their companies (poorly as in the case of Carly)?

Let’s take Pfizer. Should they be obligated to give the US government 40% of their profits, or though the application of legal maneuvering, provide a significantly lower amount be deemed “unpatriotic”?

When does a liberal tax policy ever become “Unpatriotic” or is it even possible for that to happen, given your standard for patriotism?