Posted on 07/26/2012 8:05:22 AM PDT by ilovesarah2012
In a setback to US President Barack Obama’s push to curb outsourcing of jobs to low-wage countries like India and China, Republican lawmakers have blocked a Bill in the Senate that sought to end tax breaks for companies shipping jobs overseas but cut taxes for those bringing the jobs back home.
Called “Bring Jobs Home Act”, the measure was first outlined by Obama in his State of the Union address in January. In recent weeks, Obama had whipped up outsourcing into a major campaign issue, questioning Republican challenger Mitt Romney’s record on this score as former CEO of Bain Capital and then as Governor of Massachusetts.
The Bill, backed by the White House, could not be taken up as it fell short of the 60 votes needed to clear procedural hurdle to start debate. Four Republican Senators broke ranks to support the measure, yet it could muster only 56-42 votes.
The White House voiced its disappointment at the development, but used it to score political points. “Rather than encouraging companies to bring jobs back to our shores, the Republicans chose to play politics and block measures that will create jobs and strengthen the middle class. We will continue to push Congress to act on proposals like this and the other remaining portions of the President’s American Jobs Act that independent economists say would create a million new American Jobs,” White House spokesman Jay Carney said.
(Excerpt) Read more at dailypioneer.com ...
I’d have to really struggle to grok that... the tax breaks will make up for producing an item at a loss (not just at a smaller profit)? This is like talking of a retailer who says they can make money by selling under cost because of the volume!
“Not only are our policies failing us, they are empowering China. What the hell is in that D. C. water?”
Money talks. Wall Street and multinational corporations made billions on the migration of US manufacturing to Asia in the 1990’s and 2000’s. Politicians were given large campaign donations to support ending quotas and lowering tariffs. The loss of tariffs, and taxes paid on profits from US manufacturing, forced Washington to borrow more and rely on individual income tax revenue. It was no coincidence the Clinton income tax increases of the 1990’s correlated with the passage of NAFTA and the lower of tariffs to China and other Asian countries.
No doubt the Chinese have been channeling money to individual politicians for two decades through laundered campaign contributions, insider trading information, and probably offshore bank accounts. Clinton should have been impeached, tried and convicted for illegally taking campaign and legal defense funds from a foreign government (remember Charlie Trie?) and then giving the Chinese access to high technology secrets. No doubt too many politicians were already receiving back channel payoffs from the Chinese for Ken Starr to explore this issue or Congress to investigate.
Wall Street is corrupt, Congress is corrupt, the Executive Branch is corrupt and the bureaucracy is corrupt. We are moving rapidly toward becoming the totalitarian state the foundering fathers feared.
You ask, “Can someone explain to me how anyone could back tax breaks for corporations moving jobs overseas?”. My answer is the politicians who vote for these tax breaks receive more from the interests benefiting from those breaks than they do from the middle class voters losing their jobs. As we’ve reached the point of 50% of the population living off the other 50%, the “takers” now rule the “producers” and the politicians behave accordingly. It matters not whether the taker is a welfare leech or a Wall Street banker. Keep in mind, our Congressmen belong to the taking class, not the producing class. Most of them started their political careers as lawyers.
China can currently make stuff cheaper than the states can, because they are a society of slaves. That might not last forever, but while it is going on it creates chaos for the erstwhile US manufacturing base.
Of course the devils advocates need to be considered too. Let’s take the extreme case: if China could furnish everything we wanted, free, would we be foolish to refuse it?
You missed the critical point my friend.....the TAX breaks & credits were BIGGER than the annual losses from produce and were provided FOR SEVERAL YEARS.
The transaction had NOTHING to do with the volume. Whether or not the company made a profit off products, they received the “free” gubmint money whose ultimate source was more than likely US Taxpayers. The gubmint handout was sufficient to (a) build the plant there and (b) run it at an operating loss of $20 per unit shipped.
Them are the facts - like it or not, and it’s rampant throughout bigbiz today.
How else do you explain the massive staffs responsible for manipulating corporate tax liabilities (eg GE’s “Pay No Taxes” strategy), mergers, acquisitions, deconstruction/liquidation, risk management and offshoring?
I’m pretty confident that if one were to analyze the relative expenditures for and by those groups it would tend to dwarf design, manufacturing, sales and support in most bigbiz entities today.
Is this another case of creating a disaster, while blaming everyone else other than themselves, and then claiming to have to solution but actually making the situation worse?
Unless the credits amounted to actually getting paid by the host government, there is no way they could keep living on a negative cash flow. Maybe the product was simply a loss leader and that’s not all they made?
As Obama told the Canadians during his 2008 campaign, “Pay no attention, it’s just rhetoric for those bitter clingers out in Ohio”.
And THAT tells us all we need to know. Thank you and thanks Sen. Hatch for shedding light on the matter.
Democrats like Obama , Pelosi, and Fiensttien have huge investments in China and Asia. Obama is the outsourcer in Chief. I hate Obama.
http://hotair.com/headlines/archives/2012/07/11/offshoring-pelosi-made-millions-on-investments-in-asia/
Offshoring: Pelosi made millions on investments in Asia
According to Pelosi’s 2011 financial disclosure statement, the Democratic House Minority Leader received between $1 million and $5 million in partnership income from ”Matthews International Capital Management LLC,” a group that emphasizes that it has a “A Singular Focus on Investing in Asia.” A quick trip to the company website reveals a featured post extolling the virtues of outsourcing.
Obama is the “we welcome China’s rise” fellow. Not “we congratulate China’s prosperity” but “welcome China’s rise.” He hates America and he has Democrats in his pocket.
One more thing to know would be helpful. How many on the committee are government to government free traders who would go all out to make sure the bill would never see the light of day?
The “value added” by manufacturing in a slavocracy like China is cheap labor. Every other cost is the same or even higher due to shipping. At most, we are throwing away our critical manufacturing base for pennies on the dollar. It is enough to make one cry.
Good call. I agree.
The devil is in the details. Never trust the first blush on these things.
Sorry, been busy getting ready to move from 2 acres back to civilization (UGH).
Here’s the deal:
You had to be there to witness the juvenile backslapping, happy faces and mutual circle jerking that occurred as a result of that particular agreement, which guaranteed about three years of “free bottom line entries” from the Malay government.
You see, it was all part of “The Grand Plan” to make a select few principals VERY wealthy at the expense of the bulk of the employees. It saddens me to admit being part/victim of a classic rape, rob and pillage process that seems to be so prevalent in Worldwide Biz these days. Sadly, the participants in these schemes are their own worst enemies and provide the free fodder for the Occupy Movement and all the other anti-Capitalism forces.
Capitalism has become the ultimate three card Monty Game.
It’s no longer about finding a market, designing the best product you can to fill the need, making it to high standards of quality, selling it honestly and providing empathetic after sale support.
These days, it’s all about shuffling the money around so as to maximize the income to those top 0.001% buggers for conning the rest of us. I’m not talking about the operations staff, but the Top Level Management and Boards of today’s companies.
In my case, we in the trenches thought we were designing, making, selling and supporting a fairly unique product for computer industry OEMs, and that that was the goal of Top Management as well.
Turns out the REAL product was “maximizing company valuation to a potential market for IPO stock”.
The BoD couldn’t have cared less about the long term effects of their decisions - EVERY SINGLE act was focused on getting to the IPO day, after which they would be in the tall cotton, after spinning off the real estate assets (non-trivial) for further long term wealth creation.
The stock today rides around 1/3 of the IPO price as a new cast of characters manipulates the company’s day to day existence while they try to shuffle the assets around to best benefit themselves, the original cast having long departed, in fine financial fettle for parts unknown, while hundreds of dedicated but misinformed, misguided and maltreated regular Joes and Janes were left high and dry, wondering just exactly what had taken place.
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