I have a social-justice question for Senator John Kerry: how can you be for “international cooperation” and against “Benedict Arnold CEOs” who “outsource” American jobs?
Translated, that means we aren’t going to let Indians compete for American IT contracts or allow the Chinese to sell us Happy Meal toys. So you’re going to simultaneously deny those countries access to American markets, and then expect they’ll support your foreign policy?
How will that work, exactly?
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Somebody on the left needs to wake up and smell the coffee. We’ve got a global economy going on and offshoring is going to be part of the reality of american business as long as it makes economic sense.
Yeah, but this is yet another repetitive chapter in an old story. Recently, I happened to see an old newspaper front page with an article about protecting American workers from rapacious foreign competition. The date? Early 1929. The tariff bill, and the international trade war that ensued, was one of the direct causes of the Great Depression.
In the 1960s, people said Japanese goods were cheap and low quality. In the 1970s, they said that the quality of Japanese goods had improved, but that was only because labor was a lot cheaper. Then in the 1980s, Japanese labor costs were just as high as America’s, and they were turning out better products in many areas. We ran out of excuses, as we’re likely to do about China or India.
This is a good thing. It means an expanding global economy, and a more interconnected world. That means countries have much less incentive to invade each other, if they can make money peaceably.
More importantly, this *is* a social justice issue, as the Holy Father has made clear. Centissimus Annus pleads on behalf of the world’s poor, asking that they be included in “the cycle of production and exchange” that has enriched First World nations.
It’s better for American poor, too. Why should they be forced to pay higher prices for clothes or food so some politicians can “save” a few American jobs?
Somebody noticed on the TV today that Mrs. Kerry’s pickle empire has more factories in other countries than here: 57 outside the US, in fact. :-)
Personally, I think it’s a cheap shot, since Heinz has had foreign factories for a long time, and they probably weren’t erected to export US jobs, but to produce products for markets abroad.
I don’t see why it makes sense that american companies get a huge tax shelter by putting up a mailbox in Barbados, or wherever it is they go in order to flee from caesar. That’s the exporting I’m worried about.
The only thing that does, Jayson, is shield American companies from getting taxed on their overseas earnings. Right now, a company headquartered in Nebraska with a factory in Belgium get taxed by the U.S. for its operations in both places. But if they incorporate offshore, then they only get taxed on their U.S. earnings, and the Belgian government taxes them on its earnings in Belgium.
So it’s not a way of “outsourcing” anything, just a way to lower a company’s tax burden. They still pay taxes on everything they do. The U.S. is one of the only countries that taxes its companies for its foreign earnings, which is a dumb law that should end. If it did, nobody would bother incorporating offshore.