In August, Obama began to boost his voice for the middle class by arguing that corporations who take their operations elsewhere are unpatriotic. Close loopholes for millionaires, he said, and give tax breaks to working families to pay for kids' college. “Tax fairness stuff polls really well across the board,” said Frank Clemente, executive director for 'Americans for Tax Fairness.' All an effort to hold onto the majority in the Senate.
The President never uses the word "inversion." It's too hard to understand. When a company is taxed both at home and abroad, a corporate inversion lowers the burden by re-locating company headquarters to a select country that has lower tax rates. I guess the word "loophole" is easier, and casts more aspersions, but it's not accurate. Burger King moving to Canada sounds less like a loophole and more like voting with one's feet.
At present, inversions, hopscotch loans, and skinny-down dividends (so you don't have so much of your company in the unfavored country) all appear to be legitimate actions. Unlike other countries, the US lays taxes on income earned in both this country AND abroad, where the income is often also taxed by the host country. US top rate is 35%, Europe 20%.
My questions is, is advocating 'economic patriotism' ever a sound practice within the principles of Objectivism? What are the pro-arguments? As much as the US has fallen, there are still qualities which would go extinct under the long thrash of base-erosion. What about building a business in a country that does not support freedom of the individual?
Realistically, in the context of colossal pressure on executives to perform for Board of Directors in market competition, Obama is worse than whistling in the wind, even with the new treasury regulations. Is it just rhetoric, or is America enough of a value to stand by at the expense of one's company?