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> In the meantime, let's bring the manufacturing chain back here so we can build up the automation expertise ourselves How? There's obvious long term financial

> In the meantime, let's bring the manufacturing chain back here so we can build up the automation expertise ourselves How? There's obvious long term financial value in having local supply chains and manufacturing expertise. Therefore state capitalist systems will subsidize local manufacturing in the short term, while anarcho-capitalist systems will flock to set up shop there to capture convert those short-term subsidies into short-term profit. Do you have a solution that will work to build high-tech manufacturing infrastructure in the United States with no corporate incentives and no US government intervention? (I mean besides tweeting brags about job creation)

adventured 10y ago
Sure, dramatically lower the corporate income tax rate and substantially reduce the massive over-regulation in the US economy. Check out the various regulation registries at the Federal level, the US is choking to death on thousands of unnecessary regulations (growing rapidly for decades) that are almost always written solely for the benefit of protectionism or for fake the-government-is-doing-something purposes (which happens at all levels). The US corporate income tax rate has been a bad joke for a long time. Countries like Sweden at 22%, understood decades ago that it was bad economic policy to have a high rate. You tax the income of the wealthy as the offset. The US for example already has an extremely progressive personal income tax rate. For several decades the corporate income tax rate has been falling around the world; the world's average rate has fallen from near 30% to 22% in the last 12 years. The US isn't competitive, you see that in how we've been bleeding pharma & biotech companies off to Ireland. Over time, you start seeing R&D & operations offshoring because of that. Give it time and you've artificially created a lot more global competition through bad policy. If you're a small to mid size manufacturer in the US, paying a 30% effective income tax rate is brutal if you want to compete globally while everyone else is paying far lower rates. Germany for example lowered their top rate by about 9 points a decade ago. Finland and Iceland have a 20% rate. Korea is at 24% and China at 25%. The European average is about 20%.
- smallnamespace 10y ago
  The US effective tax rate for corporations is pretty much comparable to other developed countries' effective rates [1], because the US has more deductions, write-offs, and tax holidays. If you're talking about cutting the statutory rate while also eliminating deductions and simplifying the code, I'm all for that (ditto for personal income taxes). A huge complicated tax code benefits big corporations more than your small business owner, because tax lawyers and accountants are largely a fixed cost. But let's not keep repeating the misguided fact that US corporations pay unusually high taxes -- they simply don't. [1] http://www.forbes.com/sites/taxanalysts/2015/03/25/the-truth-about-corporate-tax-rates/#f29735920a54 http://www.forbes.com/sites/taxanalysts/2015/03/25/the-truth...
  - usrusr 10y ago
    When looking at effective tax rates, one might want to include the cost for all the experts employed to get to the difference between nominal and effective tax rate, and the brain drain these careers impose on more productive disciplines. But you will have a hard time finding a country where people are not convinced that their tax system is the worst, so maybe the US is not particularly bad in that way either. The observation that a complicated makes the big guy part a lower effective rate than the small guy should be much more popular, I wish someone established a good name for it.
- Ironchefpython 10y ago
  > Sure, dramatically lower the corporate income tax rate and substantially reduce the massive over-regulation in the US economy. That's a great way to destroy the environment and increase corporate profits, but I was asking about how to get companies to ignore the profit of offshoring; how to convince them to act in direct opposition to their shareholder's interests, and not take advantage of the subsidies provided by state capitalist systems and locate manufacturing overseas. All cutting the tax rate is going to to is make offshoring more profitable. At no time in US history has a tax cut been correlated with business growth and job growth. Quite the contrary, The Bush tax repatriation holiday gave many businesses the working capital to invest in closing plants and moving factories overseas, resulting in the net job losses in many industries. But if you have hard data on examples of cutting taxes below a top marginal rate of 40% in western countries having any effect other than increasing income inequality, I'd love to see your peer reviewed study. And is there a particular regulation that you can think of cutting that would have more of lure for for domestic manufacturing than China dumping trillions of dollars into currency manipulation and building infrastructure and manufacturing subsidies?

adventured 10y ago

Sure, dramatically lower the corporate income tax rate and substantially reduce the massive over-regulation in the US economy. Check out the various regulation registries at the Federal level, the US is choking to death on thousands of unnecessary regulations (growing rapidly for decades) that are almost always written solely for the benefit of protectionism or for fake the-government-is-doing-something purposes (which happens at all levels). The US corporate income tax rate has been a bad joke for a long time. Countries like Sweden at 22%, understood decades ago that it was bad economic policy to have a high rate. You tax the income of the wealthy as the offset. The US for example already has an extremely progressive personal income tax rate. For several decades the corporate income tax rate has been falling around the world; the world's average rate has fallen from near 30% to 22% in the last 12 years. The US isn't competitive, you see that in how we've been bleeding pharma & biotech companies off to Ireland. Over time, you start seeing R&D & operations offshoring because of that. Give it time and you've artificially created a lot more global competition through bad policy. If you're a small to mid size manufacturer in the US, paying a 30% effective income tax rate is brutal if you want to compete globally while everyone else is paying far lower rates. Germany for example lowered their top rate by about 9 points a decade ago. Finland and Iceland have a 20% rate. Korea is at 24% and China at 25%. The European average is about 20%.

smallnamespace 10y ago
The US effective tax rate for corporations is pretty much comparable to other developed countries' effective rates [1], because the US has more deductions, write-offs, and tax holidays. If you're talking about cutting the statutory rate while also eliminating deductions and simplifying the code, I'm all for that (ditto for personal income taxes). A huge complicated tax code benefits big corporations more than your small business owner, because tax lawyers and accountants are largely a fixed cost. But let's not keep repeating the misguided fact that US corporations pay unusually high taxes -- they simply don't. [1] http://www.forbes.com/sites/taxanalysts/2015/03/25/the-truth-about-corporate-tax-rates/#f29735920a54 http://www.forbes.com/sites/taxanalysts/2015/03/25/the-truth...
- usrusr 10y ago
  When looking at effective tax rates, one might want to include the cost for all the experts employed to get to the difference between nominal and effective tax rate, and the brain drain these careers impose on more productive disciplines. But you will have a hard time finding a country where people are not convinced that their tax system is the worst, so maybe the US is not particularly bad in that way either. The observation that a complicated makes the big guy part a lower effective rate than the small guy should be much more popular, I wish someone established a good name for it.
Ironchefpython 10y ago
> Sure, dramatically lower the corporate income tax rate and substantially reduce the massive over-regulation in the US economy. That's a great way to destroy the environment and increase corporate profits, but I was asking about how to get companies to ignore the profit of offshoring; how to convince them to act in direct opposition to their shareholder's interests, and not take advantage of the subsidies provided by state capitalist systems and locate manufacturing overseas. All cutting the tax rate is going to to is make offshoring more profitable. At no time in US history has a tax cut been correlated with business growth and job growth. Quite the contrary, The Bush tax repatriation holiday gave many businesses the working capital to invest in closing plants and moving factories overseas, resulting in the net job losses in many industries. But if you have hard data on examples of cutting taxes below a top marginal rate of 40% in western countries having any effect other than increasing income inequality, I'd love to see your peer reviewed study. And is there a particular regulation that you can think of cutting that would have more of lure for for domestic manufacturing than China dumping trillions of dollars into currency manipulation and building infrastructure and manufacturing subsidies?