"It’s not the “corporate tax rate “ that drives corporations to move jobs our of the U.S. it’s the cost of labor."
INCORRECT.
It’s also government regulation. If it was merely the cost of labor, it would be solved with automation, without taking the risks of operating in alien legal systems.
Regulation also drives up the cost of labor, as does the payroll tax, but the alphabet soup of federal, state, and local regulatory agencies are driving business away. Having had to get my office past local and state regulations about 25 years ago, it’s discouraging.
then there’s NIMBY. Who wants a noisy, smelly factory near their home, but that’s the best place to build one, near where their workers could live. That factory in China that assembles smart phones has its own dormatory. Who in the US would put up with that?
Then there is the American worker. From the baby boomers on, we were told to get an education so that we don’t have to get a dirty job in a factory. I remember one of my fellow pupils in sixth grade, in 1961, asking our teacher, “If everyone’s smart, who’s going to do the dirty work?” Who, indeed?
Labor is only one cost. Overall taxes and regulations are the biggest cost. (Not to mention energy and transportation costs)
A Minnesota company that assembles large screen TVs moved to Michigan a couple of years ago. They had been getting them nearly fully assembled from China before labeling, boxing and shipping them to retailers but transportation costs got too high.
They moved to Michigan where labor costs are effectively the same, but they have some parts suppliers in Ohio and Indiana which helped with transportation costs. The components are still primarily made in China but its cheaper to ship a pallet of circuit boards than it is to ship multiple shipping containers of fully built televisions.
I appreciate companies that try hard to employ Americans but labor costs are seldom the deciding factor. Maybe Trump should suggest raising energy prices so high that nobody can afford to move products more than a few miles.