Tuesday, June 17, 2014
Flight from taxes... This morning's Wall Street Journal has a good piece on one of the presumably unintended consequences of American corporate tax policy: the rather large incentive it creates for successful (that is, profitable) American-based corporations to leave the U.S. Here's a couple of key paragraphs:
But shareholders of all companies—including employees who care about where economic growth will occur in the future—should know that America's federal corporate tax rate is 35%, which when combined with state and local levies rises to an average of nearly 40%. Ireland, where politicians evidently care about economic growth and as far as we know don't seek to stifle free speech on the topic, has a corporate tax rate of 12.5%.Almost alone among civilized nations, Washington also demands to be paid on a company's world-wide earnings, rather than on money earned in the U.S. This tax is due whenever a company's overseas earnings are returned to America. Medtronic has about $14 billion overseas and rather than bringing it home and triggering the tax, the company will use the money to fund most of the cash portion of its $42.9 billion purchase.
Will politicians pay attention? Not very damned likely.
An aside on mass transit... I've heard a great many people blathering on – sometimes eloquently, though usually not – about the wonders of mass transit (including buses). Often these people have only a loose command of those pesky things called verifiable facts, but they certainly don't let that get in the way of their advocacy. If you'd like an example of this phenomenon, I'll just refer you to the public records of speeches by the advocates of the current California “bullet train” proposal championed by the world's emptiest skull, aka California Governor “Moonbeam” Jerry Brown.
But there's another aspect of mass transit that I've never seen publicly discussed: the hell on earth that it is for anyone who is introverted (like me!). Being shoved into a dirty, noisy, bumpy vehicle (train, bus, plane) with dozens or hundreds of poor examples of organisms allegedly of the same species as I – that is a well-designed instrument of torture for an introvert. For buses and trains, you can add the additional horrors of government-run, union-manned “service”. The bottom line: I'll do almost anything to avoid mass transit. I fly only when I absolutely must. I take a bus only to escape some life-threatening situation. The rest of the time I drive or walk. Here in Utah, I just might get me a bicycle (the roads are virtually flat, and off the highway there are few cars). The bus here (which is free) is likely better than others I've been on, but I'm not planning on trying it anytime soon...