Congressional Republicans rejected President Obama’s proposal to exchange a cut in corporate tax rates for an infrastructure-based jobs stimulus plan for which of the following reasons:
(a) They know U.S. corporate tax rates aren’t nearly as punitive for corporate America as they claim them to be.
(b) They realize the 2009 stimulus worked and don’t want to risk doing anything that might further improve the economy between now and the 2014 midterm elections.
(c) No matter how much any of the president’s policy proposals may align with supposed Republican policy ideals or how good it might be for country, they will oppose it for the simple reason that Obama supports it.
(d) All of the above.
The correct answer, I submit, is (d).
Republicans complain incessantly that America has the highest corporate tax rates in the industrialized world. That’s true – but only in terms of the “nominal,” or stated, rate of 35 percent. Because of the various exemptions and write-offs that corporations (if not entire industries) enjoy, the relevant number is the “effective” tax rate.
For some companies, that turns out to be at or sometimes below zero percent. News reports of General Electric or Exxon Mobil paying zero in net federal taxes in certain years – less than you or I pay – prove how deceptive the nominal rate is.
So when Obama offered to lower the general corporate rate to 28 percent, and even to 25 percent for manufacturing companies, and the Republicans balked, he put the lie to the GOP’s whiny rhetoric about burdensome corporate rates. Back in the 1950s, when conservatives claim America was still a truly capitalist country, corporate taxes as a share of gross domestic product averaged 4.8 percent; in 2012, in our supposedly socialist America, they accounted for a third of that, 1.6 percent.
As for Republicans supporting any kind of jobs-related stimulus: Are you kidding?
But if the only thing you know about the Obama stimulus is “Solyndra,” you’re a victim of conservative corporate media bias.
Why? Because the American Recovery and Reinvestment Act of 2009 was a resounding success. It put millions of people to work and jump-started companies to begin or continue working on the key technological innovations that will improve American competitiveness for the next decade and the rest of the century.
Most important, it helped reverse the retrenching growth of 2008, a year when the U.S. economy shrank about 4.5 percent. To put that in perspective, for America to recover all the wealth it lost in the last year of George W. Bush’s presidency, the Obama administration needed to find a way to expand an economy it inherited in a total free fall by about 1.5 percent per year during its first three years.
And guess what? That’s exactly what happened. Yet Republicans had the gall to start complaining as early as summer 2009 about failed liberal economic policies.
As for opposing anything the president supports, need I really chronicle the litany of responses by congressional Republicans – especially on the House side under Speaker John Boehner’s so-called leadership – to virtually every aspect of the Obama domestic and economic agenda?
All congressional Republicans seem to do anymore is hold symbolic votes to repeal Obamacare.
We get it: They hate Obamacare. So what do these congressional Republicans want?
Oh, right: Strengthening our borders at a time when immigration flows are at a 40-year low, and lowering taxes on the rich when total tax receipts as a share of GDP are at six-decade lows. That’s logical.
The correct answer, folks, is “d.” That’s “d” as in dumb.