Posted on 05/19/2015 11:12:47 PM PDT by Tolerance Sucks Rocks
Rep. John Delaney was in Hagerstown Wednesday to pitch his proposal for long-term funding of transportation and other infrastructure projects by repatriating the overseas earnings of American corporations.
"There hasn't been anything really transformative to put a lot of money into infrastructure," Delaney, D-Md., told a small group of businesspeople at Bulls & Bears restaurant.
He pointed out that the federal gas tax — the primary source of revenue for the Highway Trust Fund — has not been increased since the early 1990s, in part, because it is politically unpopular.
It also is a regressive tax that hits lower-income people harder than the wealthy, Delaney said.
The Highway Trust Fund is underfunded by $15 billion or more a year, with Congress using stopgap measures to keep it from running out of money, he said.
Meanwhile, U.S. corporations have more than $2 trillion in overseas earnings that are not being repatriated, in part, because those companies do not want to pay both foreign and U.S. taxes on their earnings, Delaney said.
Delaney has proposed an "Infrastructure 2.0 Act," a bill he said would repatriate some of those earnings, use the tax revenues to fund infrastructure projects at home and give a tax break to those corporations.
"The No. 1 thing on your list should be infrastructure" when it comes to how best grow the economy, Delaney told the group.
Besides the issue of making the nation more globally competitive, infrastructure projects "disproportionately create middle-skilled jobs" and contribute to people's quality of life, he said.
In recent years, the number of jobs for highly skilled workers has grown steadily, as have jobs for people with low skills, Delaney said.
"We're not creating those middle-skilled jobs" that transportation projects can generate through construction and related economic development, he said.
The Infrastructure 2.0 Act — which Delaney said has dozens of co-sponsors on both sides of the aisle — would bring in $170 billion and fully fund the Highway Trust Fund for six years, with enough left over for a $50 billion American Infrastructure Fund for transportation, water, energy, communications and other projects.
Delaney said that U.S. corporate earnings abroad are taxed in the countries where they are created. The companies would have to pay U.S. corporate taxes on those earnings, but under current law, are allowed to defer tax payments as long as the earnings remain overseas.
For example, he said a company like Starbucks operating in another country might have to pay a corporate tax of 20 percent there and then "gross up" to cover the difference between what was paid in overseas taxes and the higher U.S. corporate tax rate.
The U.S. corporate tax rate ranges up to 39 percent, according to the Tax Policy Center.
Delaney's proposal would end the deferment on taxes for foreign earnings and tax that money at 8.75 percent, which he said would constitute a tax cut on those earnings.
Corporate taxes would be owed whether the money is returned to the United States or remains overseas, with the revenues generated being earmarked for infrastructure, he said.
I-81 congestion cited
Within the 6th Congressional District, which encompasses Maryland's western counties east to Montgomery County, Delaney said the priority projects are widening the Interstate 270 corridor joining Frederick to the Washington, D.C., area and widening Interstate 81.
Frank Morrisey, director of production at Volvo Group Trucks, said I-81 is his bigger concern.
"You start to get tied down, just the movement of freight up and down 81," Morrisey told Delaney.
In addition, with much of Volvo's workforce coming from Pennsylvania and West Virginia, the congested highway is a safety issue for them getting to work, he said.
Morrisey said a long-term infrastructure-building program would also benefit Volvo's construction equipment business. A company investing in construction equipment wants some assurance that it will be used, he said.
A better transportation network would increase commerce and economic development in a region that has become a warehousing and trucking hub.
Brian Duffield, the East Region general manager for Dot Foods, said one problem his company has is getting drivers, despite paying good wages.
The company's Williamsport facility has 132 trucks, and "if we had enough drivers, we'd have 150," Duffield said.
Six drivers made more than $100,000 last year, he said.
Maryland “Freak State” PING!
Democrats hate cars but love roads.
900 billion “stimulus” rolled in to the baseline here 1.5 trillion deficit spending there and soon you’re talking about real money.
“widening the Interstate 270 corridor joining Frederick to the Washington,”
Please don’t.
Frederick (town and county) has already been touched by the poison of limo libs from DC thanks to 270 at all. Keep it crowded; maybe the damn commies will stop infiltrating our “western” conservative areas and destroying them, making MD officially even more Dem/commie.
2/3 of registered voters in this state are Dems, so every county is down the drain to some extent. Meanwhile, you’re willing to make commuters miserable just to stop liberals, who in all likelihood will move there anyway to escape their self-made ghettos.
All you opposition will do is to fuel their goal of pushing most people onto mass transit.
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