And oil companies. Don’t forget them.
Yup. My uncle works for one of the Big Oil™ companies and they treat their people VERY well…not like scum at all. Pity…
-XT
Exxon pays more in taxes than the bottom 50 million Americans combined. Giving them a tax cut seems…expensive.
Again, this plan is just incoherent. Obama may have a couple of good economic advisers, but he sure isn’t listening to them.
Yeah, they treat us consumer as scum, not their employees. 
I’m no economist, so I’m certainly prepared to be schooled. In fact, I’m asking for it. Also, I note two other things: (1) that I simultaneously recognize and dislike these stupid names (“Patriot Employer”, in this case) and (2) no, Sam, I’m not “stalking” you (if it appears that way from my posts from the sustainable agriculture thread); really, it’s mere coincidence. With that said:
Yes, that seems right to me. But I’m not seeing the huge issue you seem to be seeing. AFAICT, the point of the plan is to offset very specific advantages other companies may use: those that do fulfill the definition of “Patriotic Employers” (gah, I hate that name).
Is that “distortionary”? Yeah, it is. But that, in and of itself, is not enough to convince me that it isn’t of overall benefit to the U.S. economy. The WSJ and others seem to be (note that I said seem; school me if I’m wrong) playing fast and loose with who benefits and who doesn’t. Simply saying that Company X’s products will be undercut doesn’t make their case.
With the little economics I do know, at least part of this has to be founded on the idea of the “economic multiplier”. That would be the one that’s being used as the justification for the “economic stimulus package”. Whether or not you think that package is good or bad is irrelevant; the point is that there’s an agreed upon multiplier, which I recall as being $1.73 for every $1.00 spent. For that multiplier to be in effect, the money has to be “within” the U.S. economy. My current understanding is that that’s what the act is attempting to enforce.
Maybe putting it this way would help: is there any validity to the idea underlying “Buy American”? Yes, I realize it’s a stupid oversimplification, that in today’s age of multi-nationals it’s of limited applicability, at best. But again, is there any validity to the idea? If so, this proposal seems to me to be an attempt to put the idea into action. Not being a hard-core free-marketeer, if it introduces some distortion into the global market – to the net benefit of the U.S. economy – it’s not clear to me that that’s a bad thing.
I don’t see all that much to worry about here. It seems a very silly piece of legislation that will accomplish very little good, but very little harm as well.
If corporations feel that they could maximize profits by becoming “patriot employers”, both through the tax break and the possible goodwill they could generate among consumers by using that title, they’ll do it. If not, then they won’t. The only thing I could see going wrong is if there’s a large number of companies who operate like this anyway, and it results in a major loss in tax revenue.
Actually, this could work, if it were part of a wider consumer campaign. Not just “buy American” but “support the best employers” with a government regulated label to guide the consumers and a subsidy to give them less of an excuse not to treat their employees well.
This piece of legislation doesn’t seem to be imposing immediate taxation of worldwide income as the article suggests (Subchapter F is seems safe). In fact it doesn’t seem to do much.
Obama has repeatedly said he would take away the tax subsidies from the companies for shipping out jobs overseas and give them to companies that create jobs here. I spend a lot of time readint he tax code and I don’t recall seeing a tax subsidy for companies that shipping our jobs overseas. Does anyone know what he means? Is he talking about the research and development tax credit that results in a patent that is immediately transferred to a subsidiary in the Bahamas so that the US company can take deductions for royalty payments and stuff like that (basically, international tax planning)? Because that is a pretty monumental task (not one we can’t do but monumental).
“Obama to Interfere with Economy!” Aunt Esther sees the headlines, clutches her pearls and swoons into the arms of Braces, the faithful family retainer…
Puh-leeeze! In case you guys haven’t noticed, the economy has been “interfered with”. Thoroughly. The economy was shoved under a bus, then thrown to a pack of wild pigs to be violated and rooted. And you’re worried that BO might spill his coffee on it!
The economy is always interfered with, the only question is on who’s behalf. So can we cut the crap with the delicate horror?
Can anyone confirm that this is actually the full text of the act?
If it is, I just read it (took all of 3 minutes) and the fact that it takes up just over two screenfuls (on my monitor) indicates that the WSJ’s bitching about “takes four pages to define “patriotic” companies” is ridiculous. Which makes me think that the other bitching they do is probably even more misguided.
So, my question is, what exactly is it about the act that deserves such ranting? Is it that (and I’m covering all parts in these 7 bullets):
[ol]
[li]A company’s HQ is in the U.S.?[/li][li]An employer pays 60% of health premiums? (Is that substantially different than average?)[/li][li]A company maintain neutrality concerning “employee organizing drives” (which I assume means “unions”)?[/li][li]A company only qualifies if as many jobs are “inside” the U.S. as “outside” (only applicable when employing 50+ people)?[/li][li]A minimum wage requirement is met?[/li][li]A company sets up 5% contribution, 100% matching funds for a 401(K)?[/li][li]A company must provide full “differential” salary and insurance for National Guard/Reserve soldiers (again, only when employing 50+ people)?[/li][/ol]
These seem like a fairly low bar to qualify as supplying a “good job with a decent wage”. Which of the above is so terrible? More importantly, why?
As to the Exxon/Microsoft examples, they must be a case of “lefty-baiting”. Why [w|sh]ouldn’t they get a tax cut if they meet the criteria (for creating/maintaining U.S. employment)? In fact, why is it bad to incentivize (optionally, of course) any company in this way?
I’ll reiterate: I’m not an economist, nor, I must say, am I a hard-core free-marketeer. A fully free market is not only a pipe dream, but it’s not what we have now anyway. So, given that the market is already distorted in various ways, what is it that is so utterly misguided about this policy? I’m not seeing it…