Republican economics has been stated a thousand ways by a thousand (always paid) voices. But the basic idea behind all the schemes has been hard to pin down. Finally Republican front-runner Donald Trump has spelled it out in a way anyone can understand.
Thursday’s Progressive Breakfast (you should subscribe, it’s free, it’s really good) contains a story in which Trump clearly articulates the Republican/Billionaire/Wall Street case for a low-or-zero tax on corporate profits: "because they don’t want to pay the tax."
Trump Sides With Multinationals
Donald Trump backs repatriation in Time interview: “Pfizer is talking about moving to Ireland. Or someplace else … Do you know how big that is? It would wipe out New Jersey … They have $2.5 trillion sitting out of the country that they can’t get back because they don’t want to pay the tax. Nor would I … We should let them back in. Everybody. Even if you paid nothing it would be a good deal. Because they’ll take that money then and use it for other things. But they’ll pay something. Ten percent, they’ll pay something.”
There it is in a nutshell. The Republican case for low or no taxes: "because they don’t want to pay the tax."
Never mind the decades of gibberish we have been subjected to about "tax cuts increase revenue to the government" and "low taxes means more jobs" and "pro-growth policies" and "government takes money out of the economy" and "tax cuts hurt growth" and "taxes are theft." Trump has spelled it out, once and for, that all this is really about "because they don’t want to pay the tax."
Now we know why Republicans are always, always saying we need to cut taxes, cut government, cut wages, cut environmental protections, cut worker-safety protections, cut health inspections, cut programs for the elderly, cut services for the mentally disabled, cut every damn thing that makes lives better for We the People. "Because they don’t want to pay the tax."
Why are they always going on about these things? They want to keep it for themselves. Forget our schools, roads, climate, bridges, scientific research, space exploration, health, safety, dams, fire protection and the rest. They want to keep it for themselves.
So it all boils down to this: "because they don’t want to pay the tax." Toward that end the corporations and billionaires put a boatload of money into their hundreds of "free market think tanks" and "foundations" and various media outlets all pumping out anti-government, anti-tax crap 24 hours a day, 7 days a week, 365 days a year. It's worth the money, because in the end the tax breaks and tax cuts and tax deferments tax subsidies they get out of it amount to far more than the money they pay to propel the propaganda. In the end, really, it all comes down to this: "because they don’t want to pay the tax."
What Is Repatriation?
When Trump talks about "$2.5 trillion sitting out of the country that they can’t get back because they don’t want to pay the tax" he is talking about taxes that giant, multinational corporations owe on profits made outside of the US. There is a loophole that lets companies dodge their taxes until they "bring the profits back to the US" also known as "repatriation." So some companies do everything they can to make it look like their profits come from outside the US to dodge paying the corporate taxes due. (Moving production to China, setting up mailbox subsidiaries in Bermuda, Cayman Islands, Ireland, etc...) Now they are hoarding something over $2 trillion outside of the US, on which somewhere up to maybe $700 billion is owed to the US government. (The math: more than $2 trillion, 35% tax rate, minus various deductions...)
Never mind the other businesses that did not engage in these schemes to dodge paying their taxes -- the smaller businesses, responsible businesses that try to be good citizens, businesses that don't try to squeeze employees, customers, communities and shortchange We the People (the government)... The giant, multinational corporations that set up subsidiaries in tax-havens, moved production out of the country, etc. should get a reward. "They don't want to pay the tax," says Trump, so there it is.
Trump says to let these corporations off the hook from as much as maybe $700 billion they owe "because they don’t want to pay the tax." But really, this is the core of the Republican argument against all taxes. And Trump has finally, clearly and for the record explained the core of the Republican economic argument: "because they don’t want to pay the tax."