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What is an American Corporation and does it Matter?

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Henry George
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vs.
From flickr.com/photos/66970309@N07/6100819322/: Robert Reich
Robert Reich
(image by HarvardEthics)


Robert Reich published the following article in today's Huffington Post.
Before I get into what I think is good and bad, I'd like to show the whole article, which is fairly short:


"You shouldn't get to call yourself an American company only when you want a handout from the American taxpayers," President Obama said Thursday.

He was referring to American corporations now busily acquiring foreign companies in order to become non-American, thereby reducing their U.S. tax bill.

But the president might as well have been talking about all large American multinationals.

Only about a fifth of IBM's worldwide employees are American, for example, and only 40 percent of GE's. Most of Caterpillar's recent hires and investments have been made outside the U.S.

In fact, since 2000, almost every big American multinational corporation has created more jobs outside the United States than inside. If you add in their foreign sub-contractors, the foreign total is even higher.

At the same time, though, many foreign-based companies have been creating jobs in the United States. They now employ around 6 million Americans, and account for almost 20 percent of U.S. exports. Even a household brand like Anheuser-Busch, the nation's best-selling beer maker, employing thousands of Americans, is foreign (part of Belgian-based beer giant InBev).

Meanwhile, foreign investors are buying an increasing number of shares in American corporations, and American investors are buying up foreign stocks.

Who's us? Who's them?

Increasingly, corporate nationality is whatever a corporation decides it is.

So instead of worrying about who's American and who's not, here's a better idea: Create incentives for any global company to do what we'd like it to do in the United States.

For example, "American" corporations get generous tax credits and subsidies for research and development, courtesy of American taxpayers.

But in reducing these corporations' costs of R&D in the United States, those tax credits and subsidies can end up providing extra money for them to do more R&D abroad.

3M is building research centers overseas at a faster clip than it's expanding them in America. Its CEO explained this was "in preparation for a world where the West is no longer the dominant manufacturing power."

3M is hardly alone. Since the early 2000s, most of the growth in the number of R&D workers employed by U.S.-based multinational companies have been in their foreign operations, according to the National Science Board, the policy-making arm of the National Science Foundation.

It would make more sense to limit R&D tax credits and subsidies to additional R&D done in the U.S. over and above current levels -- and give them to any global corporation increasing its R&D in America, regardless of the company's nationality.

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http://newthinking.blogspot.com/

Scott Baker is a Managing Editor & The Economics Editor at Opednews, and a blogger for Huffington Post, Daily Kos, and Global Economic Intersection.

His anthology of updated Opednews articles was published by Tayen Lane Publishing (December, 2014) and may be found here:
https://tayen-lane.squarespace.com/america-is-not-broke/

Scott is President of Common Ground-NYC (http://commongroundnyc.org/), a Geoist/Georgist activist group. He has written (more...)
 

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Thanks for this thoughtful and well-reasoned artic... by Richmond Shreve on Tuesday, Jul 29, 2014 at 12:47:24 PM
We need to separate the tax on land from the tax o... by Scott Baker on Tuesday, Jul 29, 2014 at 3:29:37 PM
I suggest that insurance companies should be aboli... by Pal Palsimon on Tuesday, Jul 29, 2014 at 3:45:00 PM
Well, I have to disagree with you on this, because... by Scott Baker on Tuesday, Jul 29, 2014 at 4:12:47 PM
I disagree with you on this because if all land we... by Pal Palsimon on Wednesday, Jul 30, 2014 at 5:40:51 PM
Scott is correct. Right now it is government floo... by June Genis on Wednesday, Jul 30, 2014 at 6:29:48 PM
Yes, plus they are politically, as opposed to econ... by Scott Baker on Thursday, Jul 31, 2014 at 2:14:20 AM
Now this is my question when you talk of socializi... by Pal Palsimon on Friday, Aug 1, 2014 at 4:39:48 AM
The difference (not counting Obamacare) is that in... by June Genis on Friday, Aug 1, 2014 at 12:15:18 PM
Well, insurance is not really voluntary if you do ... by Scott Baker on Friday, Aug 1, 2014 at 3:09:28 PM
Having insurance is not voluntary in any event. E... by Pal Palsimon on Friday, Aug 1, 2014 at 8:59:26 PM
Private insurance IS voluntary. The fact that som... by June Genis on Friday, Aug 1, 2014 at 9:41:41 PM
A wealthy person can pay cash for a home and not b... by Pal Palsimon on Monday, Aug 4, 2014 at 11:37:30 AM
I agree that paying for insurance is not a choice ... by June Genis on Monday, Aug 4, 2014 at 12:45:46 PM
Consider the farmer that raises only corn. When t... by Richmond Shreve on Tuesday, Jul 29, 2014 at 7:12:32 PM
Actually, it is land speculation, not over-buildin... by Scott Baker on Wednesday, Jul 30, 2014 at 2:58:39 AM
Scott, This article gives me a better feel for you... by June Genis on Tuesday, Jul 29, 2014 at 1:30:48 PM
Assessors have been figuring out land values for h... by Scott Baker on Tuesday, Jul 29, 2014 at 3:33:19 PM
Your answer doesn't address the store owner who wi... by June Genis on Wednesday, Jul 30, 2014 at 11:52:35 AM
On the contrary, when someone owns something, they... by Scott Baker on Wednesday, Jul 30, 2014 at 12:47:57 PM
Remember that libertarians consider pollution to b... by June Genis on Wednesday, Jul 30, 2014 at 1:48:39 PM
Well, I read the article but I need to ponder it f... by June Genis on Wednesday, Jul 30, 2014 at 2:03:54 PM
Well, this law would return 100% of what's collect... by Scott Baker on Thursday, Jul 31, 2014 at 2:20:51 AM
Seems to me these are economic problems where ther... by Pal Palsimon on Tuesday, Jul 29, 2014 at 3:48:53 PM
While government safety nets are far from the firs... by June Genis on Wednesday, Jul 30, 2014 at 2:14:37 PM
I think you refer to private non-profits - especia... by Pal Palsimon on Wednesday, Jul 30, 2014 at 5:44:59 PM
Is it possible that all governments the world over... by Pal Palsimon on Tuesday, Jul 29, 2014 at 3:27:23 PM
I'd like to learn more about Israel. I will look ... by Scott Baker on Tuesday, Jul 29, 2014 at 3:36:16 PM
I am very much into the idea of abolishing corpora... by Pal Palsimon on Tuesday, Jul 29, 2014 at 3:51:55 PM
Yes, the Native Americans, though a widely diverse... by Scott Baker on Tuesday, Jul 29, 2014 at 4:16:44 PM
How do you separate the value of a building from t... by June Genis on Wednesday, Jul 30, 2014 at 2:22:37 PM
In reality (as in Real Estate), brokers and assess... by Scott Baker on Thursday, Jul 31, 2014 at 2:28:11 AM
Article: What is an American Corporation and does ... by Pal Palsimon on Tuesday, Jul 29, 2014 at 3:37:23 PM
ECONOMY 1From palsimonsintelligentsia.org: htt... by Pal Palsimon on Tuesday, Jul 29, 2014 at 5:56:33 PM
Scott Baker's points about a land tax make more an... by Rudy Avizius on Tuesday, Jul 29, 2014 at 10:42:51 PM
Right... but That makes too much sense and greedy ... by Pal Palsimon on Wednesday, Jul 30, 2014 at 1:08:16 AM
There are American corporations from the top of Ca... by John Jonik on Wednesday, Jul 30, 2014 at 1:18:01 AM
Where did you get that great cartoon? Can I put i... by Pal Palsimon on Wednesday, Jul 30, 2014 at 2:26:17 AM
All we need is for SCOTUS to rule that corporation... by Scott Baker on Wednesday, Jul 30, 2014 at 3:01:28 AM
Just wondering, Scott"..aren't we already close to... by Burl Hall on Wednesday, Jul 30, 2014 at 3:21:14 AM
Well, de facto probably so, but not de jure...yet.... by Scott Baker on Wednesday, Jul 30, 2014 at 10:15:54 AM
We need to get rid of global free trade,a system c... by kappie on Wednesday, Jul 30, 2014 at 8:51:11 AM
Most of the compensation for CEOs and other making... by Scott Baker on Wednesday, Jul 30, 2014 at 10:20:51 AM
May I mention we not only have socialism for the r... by Pal Palsimon on Wednesday, Jul 30, 2014 at 5:49:27 PM
What Reagan proposed was not really free trade but... by June Genis on Wednesday, Jul 30, 2014 at 2:29:52 PM
These proposals, while thought provoking, do not a... by Gary Reber on Wednesday, Jul 30, 2014 at 5:19:19 PM
This, and the comments that follow, are way too mu... by Scott Baker on Thursday, Jul 31, 2014 at 2:36:21 AM
At the heart of the obstacle to broadened personal... by Gary Reber on Wednesday, Jul 30, 2014 at 5:20:39 PM
This proposal is globally feasible because future ... by Gary Reber on Wednesday, Jul 30, 2014 at 5:21:14 PM
"Pure credit" and capital credit insurance are the... by Gary Reber on Wednesday, Jul 30, 2014 at 5:23:15 PM
This is the pathway to creating new owners and bro... by Gary Reber on Wednesday, Jul 30, 2014 at 5:23:47 PM
We need to define a foreign corporation with at le... by Gary Reber on Wednesday, Jul 30, 2014 at 5:24:45 PM
You have to watch the Daily Show for June 30th, wh... by Susan Lee Schwartz on Thursday, Jul 31, 2014 at 12:33:11 AM