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The Outsourcing Canard: There is no tax break for companies to ship jobs overseas.
National Review ^ | 10/31/2014 | Mona Charen

Posted on 10/31/2014 6:51:54 AM PDT by SeekAndFind

When I fretted to my friend and colleague Jay Nordlinger that the Republicans may learn the wrong lessons from success in 2014, he noted sagely that he prefers to wait until the results are in before drawing any lessons. While that ought to have stayed my hand, I think some contours are discernible, and so I plunge in!

The 2012 election was essentially a protracted exercise in character assassination. Democrats painted Romney and Republicans generally as extremist cretins who held rigid views on abortion, were hostile to the point of combat towards women, engineered the financial crisis to benefit their rich cronies, and cared so little for working people that they supported tax breaks for companies that shipped jobs overseas.

A couple of Republican candidates played into Democrats’ hands that year. But Republicans have learned. They now understand that you don’t have to endorse taxpayer-funded abortions and free IUDS to get a hearing from women. A convincing rebuttal to the false charges about “outlawing birth control” and so forth is sufficient. Gynecological issues don’t rank very high among women compared with the economy, jobs, and national security. When Republicans accurately convey their positions, the Democrats’ scare tactics stand exposed. The Denver Post, for example, in its endorsement of Cory Gardner, noted that Senator Mark Udall’s “obnoxious single issue campaign is an insult to those he seeks to convince.”

If the lesson of the war on the war on women was (1) expose the lies, and (2) shame the liars who attempt to scare voters to the polls, the same lesson applies to the Democrats’ low, libelous race baiting. From South Carolina to Arkansas to Georgia, Democrats are running ads on black radio stations and distributing leaflets in black neighborhoods warning African Americans that if Republicans win next week, more Trayvon Martins and Michael Browns will die and Obama will be impeached. These smears demand a response — not because Republicans hope to win the African-American vote, but as a matter of political hygiene. And yes, someday, the right candidates from Lincoln’s party may be able to carve out a larger share of that vote.

There is another hardy perennial that can profit from the same treatment: the great “tax breaks for shipping jobs overseas” canard.

Senator Barack Obama hit this theme hard in 2008 — shaking his head in wonderment that Republicans had enacted tax breaks for companies that ship jobs overseas (TBFCSJO). He promised that if elected he would end that “loophole.” In 2012, after governing for four years, (Democrats could have repealed it — if it existed) Obama sold that same rug to voters again, accusing Romney of favoring the tax break.

This year, having ridden the war on women horse into the ground, many Democratic candidates are returning to the mythical TBFCSJO. In Iowa, Bruce Braley is hammering Joni Ernst for her supposed support. Allison Lundergan Grimes is accusing Kentucky’s Mitch McConnell of wanting to reward companies that ship jobs overseas. New Hampshire’s Jeanne Shaheen is trotting it out, and in Louisiana, Harry Reid’s Majority PAC is using it against Bill Cassidy, but with an extra twist (this being Harry Reid) — the suggestion that the “tax break” is the bidding of “out of state billionaires,” i.e., the Koch brothers.

This TBFCSJO has the virtue of playing to Democrats’ favorite stereotype — greedy Republicans helping their plutocratic friends at the expense of ordinary working people. It’s a perfect campaign issue in every respect save one — it’s false.

As Mitt Romney retorted in a debate in 2012, “Look, I’ve been in business for 25 years and I don’t know what you’re talking about.”

Fact checkers from the Washington Post to Politifact confirm there is no TBFCSJO. Companies can deduct moving expenses — but this applies whether the firm moves domestically or internationally and certainly doesn’t reward outsourcing. Moving expenses are trivial. A multinational is not going to move its operations from Bangor to Bangladesh because they get to deduct their packing boxes and freight fees. Such decisions are based on weightier concerns, including serving foreign markets, labor costs, and the tax climate.

That last might seem a good place to start if you were hoping to keep companies here and to attract others to relocate in the U.S. Our corporate tax rates are the highest in the developed world. But that assumes good faith, and Democrats seem much more interested in the sound bite.

— Mona Charen is a senior fellow at the Ethics and Public Policy Center


TOPICS: Culture/Society; Government; News/Current Events
KEYWORDS: outsourcing; taxbreak
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1 posted on 10/31/2014 6:51:54 AM PDT by SeekAndFind
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To: SeekAndFind

No tax breaks, just cost incentives. Why pay a U.S. worker when you can find someone in India or China or the Philippines who can do it for a fraction of the salary?


2 posted on 10/31/2014 6:53:21 AM PDT by DoodleDawg
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To: SeekAndFind

What there is, is cheaper labor, less regulation, and overall lower taxes.


3 posted on 10/31/2014 6:53:26 AM PDT by cripplecreek (You can't half ass conservatism.)
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To: cripplecreek

Condensed down. US-made underwear and India-made underwear....basically fit about the same. One cost $1.50 to make....the other .15 cents. The rest is not worth discussing.


4 posted on 10/31/2014 6:58:28 AM PDT by pepsionice
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To: SeekAndFind

But there may as well be, as tens of millions of people evidently BELIEVED that there was, and consequently cast their votes against Romney.


5 posted on 10/31/2014 7:15:33 AM PDT by Buckeye McFrog
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To: SeekAndFind

We have too high a general tax burden, too much regulatory State, and Unions who have lost their minds...

And people wonder why it’s more expensive to do business here?

So... What should we do about it? Make off shoring illegal? Punish those companies with fines?

Or should we scale back the Federal burden on our economy to help make our labor competitive again and enact monetary policies that make our currency worth more than the paper it’s printed on...


6 posted on 10/31/2014 7:16:00 AM PDT by Dead Corpse (A Psalm in napalm...)
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To: pepsionice
Condensed down. US-made underwear and India-made underwear....basically fit about the same. One cost $1.50 to make....the other .15 cents.

Both retailing for $12.99 at Target and JC Penney.


7 posted on 10/31/2014 7:16:34 AM PDT by Buckeye McFrog
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To: Dead Corpse
What should we do about it? Make off shoring illegal? Punish those companies with fines?

IMO, if somebody runs on that platform in 2016, they're gonna CLEAN UP!


8 posted on 10/31/2014 7:17:39 AM PDT by Buckeye McFrog
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To: Buckeye McFrog

Are you saying that making off-shoring illegal and enacting fines on those companies is a GOOD idea?

Or just that such idiocy would be popular with the electorate?


9 posted on 10/31/2014 7:20:22 AM PDT by Dead Corpse (A Psalm in napalm...)
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To: SeekAndFind

at this rate democrats are going to kill outright US businesses and the only ones opening business here will be foreign companies.

There is a method to stop cheap labor dumping by slave nations abroad, and it is called importation taxes and not exportation taxes in the manner of income taxes.

Yes, we pay to export every time a worker gets taxed for making a product that gets exported!


10 posted on 10/31/2014 7:20:47 AM PDT by lavaroise (A well regulated gun being necessary to the state, the rights of the militia shall not be infringed)
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To: Dead Corpse

Indeed, making off shoring illegal only means foreign owned companies would fare well. This flies in the face of liberal globalism. What is going on? Just sound bites or paranoiac pimps?


11 posted on 10/31/2014 7:24:30 AM PDT by lavaroise (A well regulated gun being necessary to the state, the rights of the militia shall not be infringed)
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To: DoodleDawg

Reasonable corporate tax rates, cheap energy, and taking a meat axe to stupid regulations would go a long way to bringing those jobs back.


12 posted on 10/31/2014 7:28:30 AM PDT by Beagle8U (If illegal aliens are undocumented immigrants, then shoplifters are undocumented customers.)
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To: Buckeye McFrog

Correct me if I’m wrong, but the Wal-Mart Mexican-made underwear gets me for roughly 30-cents? I read something like this about six years ago....talking about profit that Wal-Mart takes on items like this.


13 posted on 10/31/2014 7:29:49 AM PDT by pepsionice
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To: pepsionice

I’m not accustomed to reading so much truth in so few words!


14 posted on 10/31/2014 7:53:47 AM PDT by The Duke
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To: The Duke

I should add a caveat here. If you ever get to Greece and have forgotten your underwear (not to say I did but maybe), and when you go downtown to buy Greek-made underwear....be prepared. When you say ‘el-grande’....the Greek lady will pull out these really nice cotton ones that ought to fit. When you get back to the hotel...you find that the front fits nicely, but you could probably squeeze two bowling balls into the rear section. So you get by for the remainder of the trip....feeling like these Greek guys have issues.


15 posted on 10/31/2014 8:08:55 AM PDT by pepsionice
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To: SeekAndFind
TBFCSJO?

Is she competing with the homosexual activists to create the longest acronym?

16 posted on 10/31/2014 8:27:37 AM PDT by Verginius Rufus
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To: Verginius Rufus

Not sure if this acronym will catch on.

TBFCSJO: Tax Breaks For Companies Shipping Jobs Overseas;


17 posted on 10/31/2014 8:31:36 AM PDT by SeekAndFind (If at first you don't succeed, put it out for beta test.)
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To: SeekAndFind

Yes, the phrase immediately preceded the acronym in Mona Charen’s article. The question mark was to indicate my skepticism that it would catch on (because people wouldn’t easily remember what the letters stand for).


18 posted on 10/31/2014 8:52:18 AM PDT by Verginius Rufus
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To: Beagle8U
Reasonable corporate tax rates, cheap energy, and taking a meat axe to stupid regulations would go a long way to bringing those jobs back

Not unless workers here are will to work without benefits for fraction of the cost of foreign workers.

19 posted on 10/31/2014 9:17:32 AM PDT by DoodleDawg
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To: Dead Corpse

I investigated moving my company to California a few years ago (yes I am a sucker for punishment but loved living in Tahoe when I grew up there). I manufacture small aircraft parts. Part of the process is coating the parts with zinc chromate. In six months I would go through MAYBE 1 quart for the parts that required the coating. The state regulations alone are nearly impossible to comply with. You can buy rattlecan for your boat for 10 bucks a can and spray parts all day long. BUT because I am a business I would have to install 10s of thousands of dollars of equipment and regulatory fees. The USA is run by people who simply do not want new business.


20 posted on 10/31/2014 9:40:08 AM PDT by Organic Panic
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