Tuesday, July 29, 2014

Does stopping corporate inversions require a stick, or a carrot?

The Obama administration and Democrats in Congress have recently focused on corporate “inversion” as something needing quick attention. In an inversion, a US company starts or buys into another company in a country with a lower corporate tax rate and then calls the new country home, enabling it to avoid some taxes in the US. Although US companies still pay the same rates on US income, the lower rates apply to income earned abroad.

The Congressional Research Service reports that there have been 47 inversions in the last decade, and Business Week online identified 14 since 2011. The administration brought the issue to the fore with a letter from Treasury Secretary Jack Lew saying that inversions ‘’hollow out the U.S. corporate income tax base.”

The issue has both practical and political importance, highlighting the lower amount of corporate taxes collected, and also providing politicians who may be or become candidates for office a populist issue to exploit, like Sen. Elizabeth Warren, D-Mass., considered a potential presidential candidate.

Leaders of both political parties on the Senate Finance Committee – chairman Ron Wyden, D-Ore., and Sen. Orrin Hatch, R-Utah – agree that the tax code needs major reform, however, the two parties have different approaches on exactly how to accomplish that goal.

Peter Merrill, a director at PricewaterhouseCoopers, testified before the Finance Committee and discussed how US corporate taxation rules compare to those of other countries. He named two areas of the US tax system that “fall far outside international norms: the high corporate rate, and the worldwide system of taxation,” both of which he said make it more difficult for US companies to compete in global markets. Citing increasing competition from other nations, he said in the last 15 years the number of US companies on the Forbes Global Top 500 list has dropped by a third, from 200 to 135, and noted that the US corporate tax system contributes to this decrease.

The US corporate tax rate is the highest among major economies, Dr. Merrill said, more than 14 points above the average for the other Organization for Economic Co-operation and Development countries, and nearly 10 points higher than the average for the other G7 countries. And he noted that while other countries have substantially lowered their tax rates since 1986, the US raised its rate to 35 percent in 1993.

President Barack Obama wants Congress to enact corrective legislation that is retroactive to May, arguing that the proposal will stop companies from rushing into deals to avoid lower taxes. And he accuses these corporations of being economically unpatriotic.

Reuters reported that Mr. Obama said in remarks at Los Angeles Technical College: "Even as corporate profits are higher than ever, there’s a small but growing group of big corporations that are fleeing the country to get out of paying taxes.” And he added, "They’re technically renouncing their U.S. citizenship, they’re declaring their base someplace else even though most of their operations are here. You know some people are calling these companies 'corporate deserters.'”

Other prominent Democrats echoed that sentiment. Rep. Chris Van Hollen, D-Md., quoted in The Wall Street Journal, characterized these companies as "deserting the U.S. in order to dodge their obligations to the country and American taxpayers."

Senate Finance chairman Wyden wants to make it harder for U.S. companies to move their headquarters abroad, and commented, "… corporations must understand that they won't profit from abandoning the US." Secretary Lew joined that view, calling for a "new sense of economic patriotism."

Attacking companies as “unpatriotic” because the US tax system is punitive and encourages them to move overseas to lower costs is both hypocritical and dumb. They are legally operating within the complex and confounding framework government provides for them, and are trying to maintain profitability in an increasingly competitive global market.

Democrats want action taken now to limit inversions, but there are sound arguments that this will make things worse. Putting duct tape on the tax code instead of rewriting it and making it comprehensible and sensible is why things are such a mess. Comprehensive tax reform is the best solution.

It’s not for nothing that the Democrat Party has been tagged “the tax and spend party.” They go happily along championing high taxes to fund politically popular programs without any apparent clue that their policies frequently do more harm than good.

“Comprehensive tax reform would reduce deductions and lower tax rates for everyone," said Michael Steel, spokesman for House Speaker John Boehner, R-Ohio.

The way to encourage businesses to stay in the US and expand, or relocate to the US is to make it desirable for them to do so, and have a tax code that says “we want you here.” That means slashing tax rates to competitive world levels, stop taxing foreign income and eliminating some deductions.

Businesses provide goods and services that people want and need. They also provide jobs that enable people to afford things they want and need, and they pay taxes that support governments at all levels.

Business is the goose that lays the golden egg. Democrats need to understand that instead of beating the goose, they need to nourish it.

Tuesday, July 22, 2014

Israel continues to survive irrational hatred and violent attacks

Christians and Jews know from studying religious texts that the Hebrews lived in what is now Israel roughly 3,000 years ago, and many independent sources confirm their occupation of that land three millennia ago.

Even the Quran, the Islamic equivalent of the Bible, notes: “Sura 17, The Children of Israel (Banî Israel)” in the Khalifa translation, and perhaps others, as well.

Charles Krauthammer provided context in The Weekly Standard in 1998, commenting that “Israel is the very embodiment of Jewish continuity: It is the only nation on earth that inhabits the same land, bears the same name, speaks the same language, and worships the same God that it did 3,000 years ago. You dig the soil and you find pottery from Davidic times, coins from Bar Kokhba, and 2,000-year-old scrolls written in a script remarkably like the one that today advertises ice cream at the corner candy store.”

The land occupied by modern Israel is small, about the size of Wales or half the size of Costa Rica, and is located roughly on the site of the ancient kingdoms of Israel and Judah, except that these ancient kingdoms also included what is now the West Bank.

Israel is 263 miles long and varies from 9 miles wide at the narrowest point to 70 miles wide at the widest point. It is a little larger than Connecticut and a little smaller than New Jersey, and is home to approximately 8 million Israelis, 5.5 million of whom are Jews.

Israel is bordered on the west by the Mediterranean Sea, and its contiguous neighbors are Egypt, Jordan, Syria and Lebanon, with Iraq, Turkey, Saudi Arabia and Iran not far away.

Israel is smaller than any of its neighbors, both in geographic size and population. The nations that surround it don’t like Israel or Jewish people. “Death to Israel” is in fact a common sentiment among those nations and their people. This sentiment is reflected in a BBC poll last year showing Israel as the fourth least popular nation on the planet, behind Iran, Pakistan, and North Korea.

This perception is based largely on the fact that there are more voices in the region where Israel and its enemies reside demeaning Israel – those would be the voices of the “Death to Israel” crowd – than there are Israeli voices telling the other side of the story. It is not so different than going to Boston and asking which American League team residents think is the most unpopular, and finding most named the New York Yankees, not the Red Sox.

As the saying goes, the more you tell a lie, the more it is believed, and with the help of dishonest reporting, the lie spreads far and wide.

In fact, while the enemies scream “Death to Israel,” Israel only asks for peace, and has made numerous concessions towards that goal, only to be slapped in the face with violent attacks.

The current fighting follows an unprovoked attack on Israel by Hamas. According to the Council on Foreign Relations, Hamas “is the largest and most influential Palestinian militant movement … [and] is a Sunni Islamist group and a U.S.-designated foreign terrorist organization violently opposed to the state of Israel.”

The murders of three Israeli boys and the murder of one Palestinian boy initially stirred tensions, and Hamas unleashed a barrage of rockets on Israel to kick-start the conflict.

The differences in how the two sides operate could not be starker: Hamas fires rockets aimed at civilian-occupied areas; Israel targets Hamas compounds, militant command centers, weapons storage facilities and tunnels into Israel and Egypt.

Thus far, more casualties have occurred on the Palestinian side of the conflict, due in part to the Israeli Iron Dome defense system used to protect their citizens by intercepting rockets aimed at population centers. Hamas, however, is said to store rockets in homes and schools, and reportedly uses civilians as shields against attacks on the storage areas.

Israeli Prime Minister Benjamin Netanyahu described the two philosophies: “We are using missile defense to protect our civilians, and they're using their civilians to protect their missiles."

Such tactics help explain the greater number of casualties among Palestinians, and Hamas turns this into anti-Israel propaganda, helping to propagate Israel negative image worldwide.

Steven P. Bucci, who served America for three decades as an Army Special Forces officer and top Pentagon official, writes that “before the Israelis strike a building, every home in it gets a call on its landline phone, as do all the cell phones associated with the inhabitants of the building — the cells additionally get text messages — telling them that in a few minutes the building will be targeted. Finally, to make sure everyone gets the message, Israel drops a dud bomb—one containing no explosives—onto the roof of the structure. … There is no instance in modern military history where a force has taken greater measures to give the innocents as much chance to get out of the way.”

The broad hatred of Israel and love for its enemies is irrational. Despite this, Israel behaves honorably in defending itself against repeated attacks, holds its own against the haters, and survives.

Tuesday, July 15, 2014

Illegal immigration problem is largely a federal government creation

As a result of inadequate security measures along the southern border, the Obama administration’s leniency toward illegal entry into the country, and the idea of amnesty for illegal immigrants, the long-standing border security problem is now at crisis level due to the recent tsunami of Central American young people arriving in the US.

These kids left their homes in Honduras, Guatemala and El Salvador because of horrible conditions in those countries, entered Mexico and traversed the length of the country in an arduous journey frequently highlighted by unspeakable abuse, and crossed the border into the US.

That so many thousands could accomplish this ought to be more than a casual curiosity. Don’t you wonder how these young people can get into Mexico and travel more than a thousand miles through the country to the US border without being arrested and imprisoned? This question is particularly curious considering what happened to the US Marine war veteran Andrew Tahmooressi, who merely made a wrong turn at a confusing intersection on the border, accidentally ended up in Mexico, was arrested and has been in a Mexican jail for nearly four months. How do thousands of these kids who willfully enter Mexico illegally avoid arrest when an innocent wrong turn and a few minutes in Mexico gets Sgt. Tahmooressi put in jail?

However they manage it, when they cross the Rio Grande, the youthful illegals follow instructions to the Border Patrol station and turn themselves in. "They know that once they get to the station, we are going to give them paperwork and we are going to set them free into the United States," said Chris Cabrera, a leader of the local chapter of the National Border Patrol Council, a labor union representing U.S. Border Patrol agents.

"Most of the time, they're getting released to relatives in the U.S.," he said. "There's nowhere to put them, so they're released on their own recognizance and have a pending court date. I'd say between 95 and 97 percent of adults or youths don't show up for court."

So, due to a “soft on deportation” government attitude that serves as an invitation to people in Central America, and a fatally flawed US border policy that allows illegal aliens to easily enter the country by the thousands, they illegally cross the border and shortly thereafter disappear into the ether.

This huge influx has secondary effects that are potentially much more problematic: their presence forces border agents to be transferred away from the border so they can handle the kid tsunami, making it even easier for others to come in, such as members of drug cartels, members of MS-13 gangs, human sex traffickers, and people from the Middle East, China and Russia. Who knows what horrors these people may intend to unleash on our country?

Despite this disgraceful reality, the website tells us: “… today border security is stronger than it has ever been."

We are also told that deportation of illegals is at record levels, but Department of Homeland Security Secretary Jeh Johnson admitted before the House Appropriations Committee that “a very large fraction” of deportations aren’t really deportations, but instead are “turn-backs” at the border. Categorizing “turn-backs” as “deportations” paints a rosy but inaccurate picture: actual deportations are down sharply.

Let’s be honest: With his pen and his phone Barack Obama takes care of the things he thinks are important, like trying to lessen the damage of the Affordable Care Act, even if doing so is not legal or constitutional. Everything else he tosses aside with simplistic denials, or third grade humor, like "Maybe they'll need a moat. Maybe they want alligators in the moat."

He could have fixed the porous southern border and stemmed the influx of illegal aliens entering the country, but instead his actions made the situation worse, because fixing this dangerous problem is not important to him.

Mr. Obama wants nearly $4 billion in “emergency spending” to take care of these youthful illegals, but the situation does not qualify for emergency spending. The border crisis isn’t “sudden, unforeseen and temporary,” as the law requires.

Even so, the plan as outlined puts precious little of the funds toward securing the border, and lacks details on how the program would work, and how the money will be spent.

This situation has to be remedied as soon as possible. Some laws must be changed so that illegals from Central America aren’t treated more liberally than those from Mexico and Canada. Then secure the border.

Building a wall on the border, like a fence around your property, helps you control who comes in; it is an act of sovereignty, of common sense. Support it with agents and observation methods, and a second fence, if needed.

Instead of inviting people to come here illegally with a message that they won’t be sent back, send a message that will discourage people from seeking to illegally enter the country.

Americans are compassionate people who truly desire to help those in need, but we cannot do so at our own peril, as is the case with promises of amnesty and reckless border policies.

Tuesday, July 08, 2014

SCOTUS Hobby Lobby ruling sends the left into Never Never Land

The daunting effects on individual freedom of the Affordable Care Act (ACA) are legion, despite the Herculean efforts of statist advocates and the agenda media to ignore them or explain them away. One element of the law that created a storm of opposition is the requirement that employers provide 20 different forms of contraception to their female employees who have company-provided health coverage.

That element of the ACA prompted a legal challenge from Hobby Lobby and Conestoga Wood Specialties, two closely held for-profit businesses owned by people who oppose abortion on religious grounds, and challenged the requirement to provide free access to four of the twenty required items on the list that are regarded as “abortifacients,” or abortion-causing drugs.

The United States Supreme Court upheld that challenge by a narrow 5-4 majority, allowing the plaintiff companies to refuse to provide the offending drugs that interrupt the fetal development process after conception, and thus are abortifacients.

While relieving the two employers of the requirement to provide coverage forbidden by their religious beliefs, the ruling did not affect the requirement to provide 16 other contraceptive items.

Nevertheless, the businesses have been accused of waging a “War on Women.” And, the case has unleashed a flurry of ill considered, factually deficient, and inane comments from those who want to persuade others that there actually is a “War on Women.”

To wit: “It’s very troubling that a salesclerk at Hobby Lobby who needs contraception, which is pretty expensive, is not going to get that service through her employer’s health care plan because her employer doesn’t think she should be using contraception,” said Hillary Clinton last week.

There are several problems with this statement, not the least of which is that Ms. Clinton has no idea what she is talking about. Given the facts of the ruling, the assertion that the employer thinks people shouldn’t use contraception is plainly absurd. It is likely true that these business owners probably do think women should use contraceptives to avoid the “need” for abortions, which violate their religious beliefs. And, women may “want” contraceptives, but they don’t “need” them.

Social justice attorney and California State Senate candidate Sandra Fluke on MSNBC’s “Hardball”: “What this is really about at its base is trying to figure out as many ways as possible to limit women’s access to reproductive healthcare.” If you oppose 20 percent of required “contraceptives” – the challenged items aren’t really contraceptives at all – you are trying to limit women’s access to reproductive healthcare? Seriously?

House Minority Leader Nancy Pelosi called the decision “an outrageous step against the rights of America’s women.”  Of course, not wanting to provide abortion drugs for women is tantamount to attacking all women’s rights.

Senator Patty Murray said it is “a dangerous precedent and takes us closer to a time in history when women had no choice and no voice.”  She apparently forgot that she, a woman, was elected to the US Senate, and that women have held and currently hold many high positions in government and the private sector.

Democratic National Committee Chair Rep. Debbie Wasserman Schultz said, “It is no surprise that Republicans have sided against women on this issue as they have consistently opposed a woman’s right to make her own health care decisions.” Has she discovered a Republican bill now being drafted to appoint male health agents to make healthcare decisions for all women?

Massachussetts Senator Elizabeth Warren tweeted: “Can’t believe we live in a world where we’d even consider letting big [corporations] deny women access to basic care based on vague moral objections.” The First Amendment protection of religious beliefs is “vague”?

Perhaps the first reaction to comments like these is, “Do these people really believe what they are saying?” And then you realize that they either do or they don’t, and either possibility represents a serious problem. Worse, all of these people are in or are seeking positions of influence and power.

How about the idea that women somehow have a right to contraception, as well as the right for it to be paid for by their employer? A quick search of the Bill of Rights, however, found no such guarantee. But there is a very prominent guarantee of religious liberty, the right to believe as one chooses, a belief that is free from control by and interference from government.

But in today’s upside-down America, business owners who honor their religious beliefs opposing abortion are called “enemies of women.” These businesses hire women, Hobby Lobby started all employees at $13 an hour before the ruling, they probably have women in management positions, may have women owners, make health insurance available to all employees, and somehow this means they are waging a “War on Women.”

But since facts and truth are not on their side, deceit and exaggeration are all they’ve got to work with, and these pathetic women are doing their best to create another class of victims to collect government largess.

But be forewarned: If you disagree with any aspect of a “progressive” cause, no matter how ridiculous that cause is, or how tiny your disagreement, you will be labeled a “woman-hater,” a “racist,” or something equally horrible.

Tuesday, July 01, 2014

Planned Parenthood president thinks when life begins isn’t relevant

Many of us living today remember when pregnancy was regarded as the beginning of a new life, was usually a welcome and celebrated event, and religious people often viewed pregnancy as a gift from God. There were baby showers where the mother was treated to gifts for use after the birth of her child, and a positive air about the “blessed event.”

Abortion was considered taboo by society and was illegal, and because of the social and legal strictures, it was rare. As a result, abortions were usually performed in secret by the woman or by some shady character. It was dangerous to the mother because of the unsanitary “back alley” conditions of the procedure. A physician rarely performed an abortion, unless the life of the mother was at stake, or some other unusual situation required it.

Back then, people accepted responsibility for their behavior and took great care to prevent pregnancy until they were ready for parenthood. In those comparatively rare times when an unwanted pregnancy occurred, the man and the woman most often became parents, or perhaps the mother gave the baby up for adoption. Unwed mothers were a rarity.

Through the decades unintended and unwanted pregnancies have increased from rare episodes of bad luck and careless behavior to epidemic proportions, and instead of being seen as a reason to make changes to accommodate the new life that had been created, unwanted pregnancy is viewed today as an intrusion on the woman’s freedom, an inconvenience that demands relief, not so different from a headache or a cold. And to accommodate many women’s preference not to have the baby they have created, abortion has evolved from a rare thing to a routine procedure performed thousands of times each year. Now, many view a woman deciding to end the life of the child developing inside her as a right she may exercise as freely as the right to speak her mind.

Today, half of pregnancies among American women are unintended, and about 40 percent are terminated by abortion. Twenty-one percent of all pregnancies, excluding miscarriages, end in abortion.

In 1981, world-renowned scientists and physicians testified before a Senate Judiciary Subcommittee that life begins at conception, which was the traditional view through the centuries. However, the question of when life begins is now being questioned by abortion advocates, and knowing the exact instant that life begins after conception and before the birth of a child is an important, if difficult to identify, piece of data to determine the point after which abortion becomes murder.

However, Planned Parenthood Federation of America President Cecile Richards thinks when life begins is not important.

Appearing on Fusion TV's America with Jorge Ramos, she was asked, “For you, when does life start? When does a human being become a human being?”

“This is a question that I think will be debated through the centuries,” she said.

“But for you, what's that point?” Ramos asked.

"It is not something that I feel like is really part of this conversation,” she said. “I think every woman needs to make her own decision,” she finally said.

"But why would it be so controversial for you to say when do you think life starts?" Ramos pressed.

"I don't know that it's controversial. I don't know that it's really relevant to the conversation," she replied.

“I'm the mother of three children,” she finally said. “For me, life began when I delivered them,” adding that her children have “probably” been the most important thing in her life since their birth.

“But that was my own personal, that's my own personal decision,” she said.

The abortion industry certainly does not want to know the absolute point at which life begins, because then it would be clear that aborting a fetus is at some point killing a child. That would not be a good thing for those who perform abortions for money, for organizations like Planned Parenthood that get federal money for advising women on unwanted pregnancies, or for those who think women should have a right to end an inconvenient pregnancy at anytime.

From this less strict attitude about when life begins all sorts of horrors might evolve. And they have.

For example, some Planned Parenthood officials have gone so far as to advocate infanticide, giving women the right to end their child’s life after it has been born.

And only a little further down that slippery slope are the preposterous acts of Kermit Gosnell, the disgraced and imprisoned former physician who was in the habit of ending the lives of babies who were inconsiderate enough to survive his efforts to abort them by clipping their spinal cords after they were born alive. He is in prison for life after being convicted of murdering three babies.

An interesting sidebar to this story is that the baby-killer managed to spare himself a death sentence when he waived his right to appeal in return for a life sentence, an option millions of aborted babies never had.

It must be pointed out that all of those who support the unfettered right for women to abort their babies have already been born.