Representative Louie Gohmert has a jobs plan. Well, he has a plan anyway. Gohmert says his bill will create jobs. If we were in a dream world, perhaps. One thing Gohmert’s bill will do, is completely eliminate the corporate tax rate.
That’s right, Republicans are ignoring jobs again in an effort to kill corporate taxes. The corporate tax rate is comparable to most developed nations in the world at 35%. But Republicans are aiming to give corporations the kind of tax rate that not even most third world countries allow: 0%. Even though cutting taxes has never created jobs, Gohmert claims his bill does just that.
“It is a very simple bill, which will eliminate the corporate tax which serves as a tariff that our American companies pay on goods they produce here in America. This bill will actually create jobs in America.”
The problem with Gohmert’s claim is that corporations are already sitting on trillions of dollars in cash. Lowering the tax rate will only give them MORE cash to sit on. They certainly won’t be inclined to spend that money on labor here in America. Every time we have lowered the corporate tax rate, it hasn’t created jobs in America. It creates jobs overseas for citizens of other nations, but not for Americans. How do I know all of this? Because corporations already pay zero in taxes. They haven’t paid income taxes for years. All the loopholes and deductions they take advantage of equals a zero percent tax rate. And that hasn’t created a single job. How would making a zero percent tax rate official be different? The answer is it wouldn’t. According to the CBO, ￼￼￼cutting taxes on businesses “typically does not create an incentive for them to spend more on labor or to produce more, because production depends on the ability to sell output.”
It would also take over $300 billion in tax revenues away from the federal government. That makes it harder to pay our debts and would create a larger deficit. Plus, Gohmert is wrong when he says that the corporate tax is “a tariff”. That simply is not true. When real people make money, they pay taxes based on their earnings. Same applies to corporations. The profit they bring in is taxed. Not the products.
As usual, Gohmert is full of crap, as are most of his Republican colleagues. Rather than try a different solution to solve our problems, Republicans continue to push the same failed policies that have torn this country down piece by piece for the last three decades. One solution that has worked in the past is a very high corporate tax rate. We need to make it expensive for corporations to send jobs overseas. Just pass a very high tax to be levied on corporations that outsource jobs. Make that tax equal to the profit that corporations gain from outsourcing. A 100% tax rate on all income generated by outsourced labor. Corporations will either have to pay 100% of their profits in taxes because of cheap labor overseas, or hire American workers and pay only the full 35% tax rate here in the states. Once corporations realize that outsourcing is no longer profitable, they’ll have to start hiring American workers to do the jobs at a livable wage. Make that tax hike a permanent penalty for outsourcing and corporations will hire Americans for generations to come. At least until some corporate shill like Gohmert comes along again.