As the American economy continues to struggle through a sluggish recovery, some of the nation’s largest corporations are refusing to disclose “a number they don’t want anyone to know”: the number of workers they employ in the United States versus the number employed overseas.
Among the companies are several that are actively lobbying Congress for another special tax break. Apple and Pfizer are members of WinAmerica, a group of corporations lobbying for a tax repatriation holiday that would allow them to bring overseas profits back to the United States at a much lower tax rate than the 35 percent they would normally pay. But those companies, among others, remain secretive about where their actual job creation is taking place, as the Washington Post reports:
So secretive are these companies that they hand the figure over to government statisticians on the condition that officials will release only an aggregate number. The latest data show that multinationals cut 2.9 million jobs in the United States and added 2.4 million overseas between 2000 and 2009.
Despite outsourcing trends, the companies continue to push for the tax holiday (supported by, among others, GOP presidential candidates Mitt Romney and Rick Perry) under the guise of domestic job creation, even though evidence from past holidays indicates the companies would be unlikely to use the tax break to create jobs. In 2004, corporations used repatriated money largely to pay dividends and buy stock and, after the holiday, stashed even more money overseas under the assumption that Congress would approve another such holiday in the future, allowing them to avoid paying taxes yet again.
The 2004 holiday “didn’t accomplish its stated goals of bringing jobs and investment to the U.S.,” said Kristin Forbes, a professor at the Massachusetts Institute of Technology and a former member of President Bush’s council of economic advisers. After receiving the tax break in 2004, many of the WinAmerica corporations, including Pfizer, laid off thousands of workers in 2005 and 2006.
In the end, the holiday would result in yet another giveaway to corporations that are already paying low effective tax rates while they create jobs overseas. That’s something lawmakers should take into consideration when discussing the possibility of another holiday, Rochester Institute of Technology professor Ron Hira told the Post. “Should you listen to the kind of advice these companies have about how to grow the economy when their record and their model indicates they’ve cut jobs?” Hira asked. “Or should we talk to people who actually do create jobs in the United States?”
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