About This Blog
Conservative policy on tax cutting most closely resembles a religious belief. Faith is the substance of things hoped for, the assurance of things unseen....according to the Christian New Testament......and that is an accurate description of conservative tax policy. Hoping for things that remain invisible.....to become real.
GOP Rep. Jim Renacci, now The Reverend's representative because Gov. Kasich and his GOP State Legislature decided to drop acid and then redraw Ohio's voting districts, has faith in conservative tax policy. He stated as much last night in Wadsworth....
U.S. Rep. Jim Renacci, R-Wadsworth, said Monday he will use his new position on the House Ways and Means Committee to lower business taxes and then pay for the cut by reducing deductions.
The genius in Renacci's claim is seen in his recommendation of a solution to a problem which does not exist.....kind of like voter ID is to voter fraud.
Why is the economy sluggish? Why isn't there more hiring going on? Why is national economic growth closer to 2% than 4%? Is the answer: corporate tax rates are too high? Of course not.
In a report commissioned by Senators Carl Levin (D-Mich.) and Tom Coburn (R.-Okla.), the GAO looked at taxes paid by profitable U.S. corporations with at least $10 million in assets.
Even when foreign, state and local taxes were taken into account, the companies paid only 16.9% of their worldwide income in taxes in 2010.
Of course not, again......
U.S. corporate taxes that were actually paid (the effective rate) fell to a 40 year low of 12.1 percent in fiscal year 2011, despite corporate profits rebounding to their pre-Great Recession heights.
Although faith doesn't anchor it's "assurances" on tangible-world realities....it just might do Jim Renacci some good to also consider this....
...the U.S. collects less in taxes as a percent of the total economy than every industrialized country in the world save Iceland.
So, no....what's hindering more robust economic growth has nothing to do with corporate tax rates. And with our effective corporate tax rate second only to the Icelandic powerhouse.....why would new world business capital look anywhere else but America.....if in fact big business chases the lowest corporate tax rates around the globe?
Further.....Renacci, like all Republicans on this subject, holds to the "revenue neutral" view of lowering corporate tax rates. Big Jim wants corporate tax rates lowered to create a faith-based magnet which he hopes will draw business to the U.S......the nation second only to Iceland RIGHT NOW with the world's lowest effective corporate tax rate. Faith-basers, the same folks who are oh-so-very-worked-up over debt and deficits, want to lower the corporate tax rate but also want to pay for the tax dollars lost in the cut by eliminating tax deductions.
Those provisions meet the "no new revenue"....ever....policy of today's faith-based political party.....even if with the slightest amount of mental energy.....anyone can see that Renacci's plan is total, gerrymandered horseshite.
Renacci says our nation's corporate tax rate is too high. So he proposes reducing the tax rate AND eliminating corporate tax deductions....so no new revenue to Uncle Sam is generated. But by eliminating corporate tax deductions.....won't corporations be paying about the same in taxes as they did at a higher corporate tax rate adjusted by those deductions? If tax revenue neither goes up or down, as Renacci desires, that has to be the case.
Barring supernatural intervention.....Renacci's "plan" doesn't change a thing for corporations. That's why I claim it takes faith, and a lot of it, to embrace Renacci and the House Republicans plan on corporate taxes. It makes absolutely no sense.
Again.....our economic problems are not on the supply side, yet Renacci is looking for solutions on the supply side. That is because all economic problems....to Republicans....should be met with tax cuts on the already rich. It's a faith-based principle on the right.
Looking for solutions in all the wrong places......that's what Jim Renacci was all about last night in Wadsworth. Consumers, workers, and seniors need more money in their pockets so they can drive demand higher. To accomplish that, SS checks should be increased, the minimum wage should be increased and corporations should be compelled by law to share their productivity gains with their U.S. workers. Also......all citizens earning less than $200,000 annually should be sent a government check for $5000...immediately.
Those are solutions which confront the actual problem in our economy. A woeful lack of consumer demand.
Renacci and the Republicans "solution" doesn't address any existing problem. Faith-based, incomprehensible, seemingly contradictory, supply-side gibberish never does.