By Brent Budowsky - 06/29/11 10:20 PM EDT
Many of America’s largest global companies are lobbying hard for a tax holiday to repatriate to the U.S. nearly $1 trillion that they have amassed from foreign business. This plan as proposed will almost certainly not be enacted. The president and Congress will not agree to support a giant windfall to reward firms that exported American jobs to foreign lands and now seek a huge taxpayer subsidy for their profits from these actions.
I propose one simple amendment to the repatriation plan that could lead to its enactment and give a significant boost to the American economy, American workers and American firms large and small.
Under my plan, the repatriation proposal would be enacted including a provision that would have the secretary of Labor certify that the new American jobs have been created, as a trigger for the tax holiday. The money could be repatriated immediately upon certification by the Labor secretary.
Corporate CEOs, boards of directors, equity investors and bond investors would all have 100 percent certainty that once the jobs were created, the money comes home immediately under the tax holiday. They would have 100 percent certainty of exactly when the money comes home. They would have 100 percent of the power to determine when the money comes home, simply by creating the jobs.
The exact number of new jobs per company that would trigger the tax holiday could vary. I would suggest a 5 percent increase above a company’s current workforce and suggest the Congressional Budget Office and Joint Tax Committee run numbers to quantify the benefit to and impact on the economy.
I have been an aggressive dissenter for over a year against the lack of a strong jobs program from Washington and a strong critic of the lack of creativity and ingenuity in economic policy. I would urge again that the housing tax credit be renewed, that a significant jobs tax credit for small businesses be created and that a large tax credit be devised for firms that repatriate jobs and equipment purchases.
We should fund a major infrastructure rebuild and consider a capital gains tax holiday for venture capitalists who finance American job wave growth companies.
While I support passage of the pending patent reform bill, it falls short of what is needed to maintain American leadership, ingenuity and jobs. The issue should be revisited until American patent law fully promotes American inventors and American prosperity.
A “repatriate prosperity” plan would lift our economy beginning shortly after enactment. Companies would announce new hires. New hires would lift consumer demand, tax revenues and consumer and investor confidence.
If $150 billion of the $1 trillion is used for hiring, companies would also have immediate access to the remaining $850 billion, some of which would be used in ways that generate additional jobs.
America must become again a nation of job-producing patriotic capitalists. “Made in the USA” should be a clarion call with a resounding echo heard in Washington.
There is nothing wrong with global firms being global, but if they want a gigantic tax break, it should be a win-win for the companies and Americans, not a win-lose deal where companies win another tax break while Americans lose more jobs.
We Americans have our economic backs to the wall. There is a cry for jobs throughout the land that remains strangely silent in the high councils of politics.
America must honor and support workers who work, laborers who labor, inventors who invent, creators who create, builders who build and financiers who finance the job waves of the future. Let’s repatriate our prosperity and rebuild our nation.
Budowsky was an aide to former Sen. Lloyd Bentsen and Bill Alexander, then chief deputy majority whip of the House. He holds an LL.M. degree in international financial law from the London School of Economics. He can be read on The Hill’s Pundits Blog and reached at email@example.com.