Congressional Republicans came to Silicon Valley this week to raise money from CEOs and their companies. They were offering a flat-out quid pro quo: give us money and in exchange we will cut your taxes, block taxes on profits made from moving jobs out of the country, cut government oversight of various schemes you try, and let you import more lower-wage tech-workers from outside the country.
The story is in the SF Chronicle, GOP Rep. Kevin McCarthy in Silicon Valley: Cut regs and corporate taxes,
[Rep McCarthy] spoke the Valley’s language: Nonpartisan. (Didn’t blame Dems or wave the GOP rally flag — CEOs hate that stuff. Just show them the money/tax breaks.) More important, he’s all about lowering regulations and cutting the corporate tax — which even President Obama gave a shout-out to Tuesday in his State of the Union.
Also, Politico: Republicans make another try to woo Silicon Valley,
In a trip this week to California, Rep. Kevin McCarthy, the No. 3 House Republican, is leading a half-dozen colleagues on a tour of its star technology companies, including Google and Facebook, in the hope the tech giants will become partners in upcoming fights over issues including tax reform, cybersecurity and immigration.
At the same time, Senate Minority Leader Mitch McConnell and Minority Whip John Cornyn will headline several Bay Area fundraisers, including a TechNet, Google PAC and Oracle PAC fundraiser at the Stanford Park Hotel in Menlo Park on Thursday.
What are Republicans offering the CEOs in exchange for the corporate cash?
Tech companies have built up their Washington lobbying offices in recent years to help them sway Congress on a host of issues. But on tap in coming months are some of their most important priorities.
They are furious that American universities educate foreign students and send them home, and they want an immigration bill to expand the H-1B visa program to help keep those students in the U.S. Another focus is repatriation to encourage corporations to bring money back to the U.S. at a lower tax rate.
[. . .] Republicans are also looking to talk cybersecurity and the so-called Volcker rule, which they say stifles startup companies’ ability to raise capital. Patent reform is also sure to be on the docket for Silicon Valley businesses — especially startups.
What this translates to:
- The H1-B visa game is that Silicon Valley is notorious for only hiring younger workers and laying off anyone that reaches the ripe age of 40 because they cost more. Since this means there are not enough tech workers, they use H1-B visas to bring in younger, lower-cost foreign tech workers. See here, here, here… and seriously read this one.
- Tax “reform” has two parts. First, just lowering the corporate tax rate so the CEOs and investor class gets more and the schools and all the things We the People do to make our lives better are starved.
- Part II of the “tax-reform” game is the money being kept out of the country for tax avoidance. Companies have moved jobs, factories and profit centers out of the country. (Google made the majority of its profits in Bermuda!) They pretend they don’t owe their taxes on the profits until they “bring the money into the country.” They are holding $1.7 trillion out of the country away from their own shareholders and the US economy, trying to find enough members of Congress to pay to let them just bring it back without paying the taxes due.
- Patent reform. Everyone knows that the patent system is ridiculous and is holding back innovation by rewarding monopolists and rentiers. But how will “reform” shake out? Monopolists and rentiers are willing to cough up good cash to have any changes go their way.
By the way, though this was billed as a trip to “talk with” Silicon Valley the Republicans only met with 1%’ers, CEOs and top executives. They were not interested in discussing the concerns and needs of regular workers here. And the open fundraiser was $10,400 for four tickets.
Same As GOP/Wall Street Corrupt Bargain
This is reminiscent of the post-crash GOP “wooing” of Wall Street cash in exchange for blocking regulations that would have reigned in the big banks.
Feb. 2010, WSJ, GOP Chases Wall Street Donors,
In discussions with Wall Street executives, Republicans are striving to make the case that they are banks’ best hope of preventing President Barack Obama and congressional Democrats from cracking down on Wall Street.
… Last week, House Minority Leader John Boehner of Ohio made a pitch to Democratic contributor James Dimon, the chairman and chief executive of J.P. Morgan, over drinks at a Capitol Hill restaurant, according to people familiar with the matter.
Mr. Boehner told Mr. Dimon congressional Republicans had stood up to Mr. Obama’s efforts to curb pay and impose new regulations. The Republican leader also said he was disappointed many on Wall Street continue to donate their money to Democrats, according to the people familiar with the matter.
Quid pro quo: give us money and we will block this effort to reign you in.
Feb, 2010, NYTimes, In a Message to Democrats, Wall St. Sends Cash to G.O.P.,
Republicans are rushing to capitalize on what they call Wall Street’s “buyer’s remorse” with the Democrats. And industry executives and lobbyists are warning Democrats that if Mr. Obama keeps attacking Wall Street “fat cats,” they may fight back by withholding their cash.
Both “sides” play this corruption game, by the way,
Wall Street lobbyists say the financial industry’s big Democratic donors help ensure that their arguments reach the ears of the president and Congress. White House visitors’ logs show dozens of meetings with big Wall Street fund-raisers, including Gary D. Cohn, a president of Goldman Sachs; Mr. Dimon of JPMorgan Chase; and Robert Wolf, the chief of the American division of the Swiss bank UBS, who has also played golf, had lunch and watched July 4 fireworks with the president.
Lobbyists say they routinely brief top executives on policy talking points before they meet with the president or others in the administration. Mr. Wolf, in particular, also serves on the Presidential Economic Recovery Advisory Board led by the former Federal Reserve Chairman Paul A. Volcker.
Quid pro quo:
The Hill, Republicans block Wall Street reform bill,
Senate Republicans held ranks on Monday and blocked a Democratic effort to overhaul the financial system and crack down on Wall Street.
In a 57-41 vote, Democrats fell short of the 60 votes necessary to proceed to the Wall Street bill.
“Fell short of the 60 votes necessary” is media-speak to mask that the filibustered the bill. The public hates filibusters, but you can filibuster anyway if the public doesn’t fund out.
After the bills passed, Republicans earned their cash: Republicans Fight To Dilute Wall Street Regulations,
Congressional Republicans are greeting the one-year anniversary of President Barack Obama’s financial overhaul law by trying to weaken it, nibble by nibble.
Wary of attempting to dismantle the entire statute and being portrayed as Wall Street’s allies – banks are among the nation’s most unpopular institutions – GOP lawmakers are attacking corners of it.
… Another House panel voted to slice $200 million from Obama’s $1.4 billion budget request for the SEC, which has a major enforcement role.
Meanwhile, Senate Republicans are continuing a procedural blockade that has helped prevent Obama from putting Elizabeth Warren or anyone else in charge of the Consumer Financial Protection Bureau, which opens its doors in two weeks.
So there it is. We have opened the door to bribery, and bribery rules the day. If you can gain from corruption you gain an advantage that drives honest players out of business. In the end the ones with the most money buy up all the advantages and keep competitors and innovators down. They deliver the minimum they can get away with, while draining the economy. Which describes what we have as an economic system now.