This is true; companies have far more important considerations than taxes when considering where to locate their job-creating facilities–factories, retail, offices, etc. Wage costs, education, cost of living, customer base; these are the real drivers of where companies locate, not local taxes. Still, tax differences between states do matter to corporations looking to exploit them and avoid paying taxes they rightfully owe.
Apple is a good example. Anyone who knows anything about the company knows that they’re based in Cupertino, California, a founding member of Silicon Valley. Nevertheless:
Now, I imagine most conservative reading this article would say this is evidence that California should lower its corporate tax rate to zero in order to reclaim those handful of employees outsourced to Reno. Of course, that would mean California could no longer provide the education, infrastructure and quality of life which drew Apple there in the first place, but I’ve found it rare to see tax zealots think that far ahead.
This, in effect, is the problem with depending so much on local control of these matters. Wealth isn’t local; it’s usually the result of a far-flung enterprise. It is a truth as old as humanity that the guys with the money will always–always–move to take over. Corporations will naturally predate on weak local governments, playing them off against each other until they get what they want.
No Income Tax? We would soon be domnated by a corporatocracy, where civic responsibilities like voting are replaced by faux “Coke/Pepsi” consumer choices.
I think you have created some standard that you think is objective but is entirely subjective.
Before we had our constitution, minting money and making treaties was frequently done at the state level. there are jsut some things taht are best achieved at the federal level like health care and other types of interstate commerce.
Especially the part that says “To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes”
I have always thought of tax competition between nations as a race tot he bottom. Tax compeitition between the states is more like cannibalism.
I read some time back a study which showed that corporate headquarters tend to migrate to where the CEO lives. Factories are different, since the execs don’t care much about the living conditions of the workers.
And then the Apple execs will be complaining about how hard it is to get trained employees, and how they need more H1 visas to make up for the poor quality of the local schools.
But that’s just restating which powers you think the Federal Government should have, which I specifically didn’t want you to do, since I already know.
What I wanted you to do is provide a rationale for why. Yes, foreign policy is the domain of the Federal Government. Why should we have a Federal Government? If local power is better, then why wouldn’t 50 independent foreign policies be better? What are the advantages to having a country consisting of 50 states rather than 50 independent countries?
Why can’t states negotiate disputes bilaterally? After all, the United States and Canada negotiate disputes between themselves, there is no higher authority to arbitrate between them. If New York and New Jersey have a dispute, why can’t they figure it out between themselves, why do they need to involve people from California and Texas and Florida? Why do we need a common currency, what’s wrong with competing currencies? If competing currencies are inefficient, then why is it bad that we don’t have a currency union with Canada and Mexico?
I understand that you believe the US Constitution got things exactly right back in 1787. But so far you’ve just stated that it did, you haven’t explained the principles by which you judge whether it did.
I explained it in one of the posts above. Some powers are inherent to the central government of the country, if the country is to be a sovereign entity. These powers are - maintaining/directing the military forces, maintaining the currency, conducting foreign policy. If there is no one central authority in the country doing that, the country is not a solid sovereign entity but a conglomeration of sovereign states - something like EU (sans the currency issue, and we see how that is working out nowadays).
As for the states settling trade disputes between themselves - no problem with that. But when they can’t/won’t, there needs to be an entity outside of the states arbitrating such disputes.
And no, the US Constitution may not have gotten things exactly right back in 1787. That is why it provides an amendment process, in order to correct or update it.