Another reason slashing corporate taxes ain’t the answer

Not that very many people with any common sense really believe that cutting taxes on corporations and the wealthy would really jump-start the North Carolina economy, but here’s some additional info that places this patently absurd idea in its proper light.

As reported today by Travis Waldron at Think Progress:

“Even as American corporations are raking in record profits, the largest among them are shifting larger amounts of money away from the United States and into offshore tax havens that allow them to pad their bottom lines even more, according to multiple analyses of legal filings made since the beginning of 2013.

The Wall Street Journal found that the 60 largest companies moved $166 billion offshore in 2012, shielding 40 percent of their earnings from American taxes and costing the U.S. billions in lost revenue.”

Got it? The problem is not lack corporate profitability; it’s lack of demand from cash-strapped, debt-strapped consumers. Generally speaking, businesses generally have plenty to invest, but are holding back or squirreling money away because they don’t perceive a demand for the products and services they might produce. Cutting taxes and public spending further just perpetuates the vicious and destructive cycle in which we are already stuck.

10 Comments

  1. Doug

    March 11, 2013 at 2:19 pm

    Cutting taxes has worked to increase government receipts for decades. It is the spending problem that our government has that constantly overshadows the reality. There has been no instance in society where government re-distributing wealth has made society an overall better place. When the greedy government gets their hands on money and power outside what government should be doing (military, foreign relations, interstate commerce and a few other limited areas) resources are allocated incorrectly and society as a whole suffers…as we are seeing now.

  2. david esmay

    March 11, 2013 at 4:15 pm

    Doug, got any evidence for that ridiculous claim? No? I do, an explosion of debt and deficits caused by the discredited Supply Side economic theory. Stockman and Bartlett, the architects of Reaganomics, have admitted this many times. It’s time for you to admit it to yourself.

  3. wncgirl

    March 11, 2013 at 4:59 pm

    It all started with Reagan… he delivered the death knell to the middle class and just look how great all that de-regulation turned out… WOW and there are some who still call him a “man of the people’ HA!!

  4. wncgirl

    March 11, 2013 at 5:02 pm

    Quick question? Why are trolls allowed out from under their bridge on this site? Civitas will not allow any views that correct theirs EVER!!! been kicked off several times, for basic fact checking. I am so glad to see real journalism instead of a propaganda arm for the state budget director.

  5. Brandon

    March 11, 2013 at 9:32 pm

    I find it funny that you use the rhetorical question “Got it?” after the block quote, as if it’s patently obvious that it proves the point your trying to make. To me, moving profits offshore is indicative of several things; namely, a burdensome tax structure (at least in the context of a global economy) and a lack of quality investments to be made domestically. Both of those can be fixed with smart policy choices, but neither of them would be fixed by higher taxes.

  6. rick

    March 12, 2013 at 5:25 am

    What Demacrats never seem to realize is that the government in itself IS a corporation. Past history in government power shows that the government has been getting more and more money directed into it. Reagan did okay by the people because corporations at that time owned very little of the land and showed no sign of threat since the small businesses were the majority. Most people dont talk about how he actually raised taxes 11 times and shut down the MANY tax havens that resided in the US for so long allowing big business to flourish even among a tax higher than 70%. Reagan started the biggest Enterprize erra in America and provided more that nine million jobs. This Enterprize erra could have been in check if lobbying would have been outlawed. We hurt becouse lobbying causes Monopolies which causes the low-wage fiasco that we see with companies like Wal-Mart. Lowering the taxes to decrease the incentive to lobby helps but you also have to place a minimum wage to direct the money to the people but only companies that make a billion or more. The small business man could actually make an existance and the middle class can be the true majority again. Neodems (nothing like the Blue-dog Demacrats of the Reagan erra) do not like the idea of Power to the People. They prefer a more socialistic society. Let the big monopolies do as the do cuz they will bring their own demise from their coruption. Meanwhile, the small business man has a bigger chance to rise and provide jobs which is the biggest threat to a monopoly in America. Wal-Mart pays low wage because the workers cant find other jobs to counter act the conglomerant behavior. Not allowing lobbying is the other aspect that i hope Mcrorry will place on the agenda.

  7. david esmay

    March 12, 2013 at 10:07 am

    Republicans never seem to realize that the government is not a corporation. Corporations self-govern. Corporations don’t have to be responsible to anyone or anything, other than their share holders, which is completely antithetical to democracy and rule of/ for/by/ the people.

    Republicans see Reagan as the demigod of good governance and fiscal responsibility, even when confronted by the fact his administration was the most corrupt since U.S. Grant’s. By the end of his administration no less than 138 members of it, some the most senior members, had been indicted, imprisoned, or were under investigation. This includes Sec. of Defense, Interior, AG, CIA Dir., etc.

    Reagan’s belief in supply side economics and laissez-faire attitude towards governing allowed debt and deficits to explode to historic proportions. We went from being the largest creditor nation in the world to the largest debtor.

    Rick, lobbying and it’s influence will only increase under McCrory, he is acting as a lobbyist for Duke Energy and Met Life from the governor’s mansion, and shamelessly so. If you have proof otherwise, I’d like to see it, but a telling sign of the increase lobbyist’s influence was the sudden retirement of GOP legislator’s last year in order to skirt the six month rule and join lobbying firms. There’s going to be a right wing feeding frenzy on tax dollars and they know it.

  8. Doug

    March 12, 2013 at 12:58 pm

    Looks like we are getting more views from the “right” side here. Good to see you guys helping shine the light of truth around here. Thanks!

  9. david esmay

    March 12, 2013 at 5:23 pm

    “Right” side and truth have never been introduced.

  10. Doug

    March 12, 2013 at 7:59 pm

    dave, for once you are correct, they have been joined from birth so they haven’t had to be introduced.