Looks like a trap boys. Run like HELL!
by Bruce Josten
Today, we are encouraged to see a bipartisan cross-section of lawmakers introducing legislation to increase the competitiveness of American business. Senator Kay Hagan (D-NC) and Senator John McCain (R-AZ)’s bill, the “Foreign Earnings Reinvestment Act,” would encourage companies to bring overseas earnings back to the United States and creates incentives for those firms to put the money to good use here at home.
Unfortunately, America suffers from an uncompetitive tax and regulatory climate that deters investment within our borders. As Tom Donohue pointed out in his jobs letter to the president and Congress last month, a repatriation holiday is one step policymakers can take right now to spur growth without adding to the deficit.
This money could be deployed in various ways into the economy – to pay dividends to consumers who spend, to shore up balance sheets or buy back stock, or to create jobs. All these are better options than leaving capital overseas that could be infused into the U.S. economy. Further, this would have a positive revenue effect that the government would otherwise not get.
It’s time for Washington to address extraordinary fiscal and competitive challenges that are smothering growth and driving away jobs. The Hagen McCain bill is a good step in the right direction.
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