Friday, September 5, 2014

Corporate Deserters

Burger King's acquisition of Canadian company Tim Hortons with plans to move corporate headquarters to Canada has spurred discussion recently.  Others have commented and commented well on this, so I'll add just a few thoughts.

There's a tangible reason companies are doing this.  Canada's corporate tax rate is very competitive, approximately 15%.  America's corporate tax rate is 35%.  Obama's solution, as a proper disciple of Saul Alinsky, is name-calling, because it works so well.  He says they're corporate deserters who want to avoid paying their fair share.  For more on the "fair share" tripe, here's a previous post.

I'll digress briefly on corporate taxes, because they're a silly concept.  Any tax levied against a corporation is paid by you.  Companies factor the cost of taxes into the price of the products they provide to you.  As all companies pay them, all companies must do this, so the price of anything you buy whether it's a good or service costs more.  The anti-corporate/anti-business attitude that spurs sky-high corporate taxes is propped up by the ill-informed who don't realize they're supporting a hidden tax on themselves.

Name calling really isn't a great solution, since it's ineffective.  "Corporate deserter," that sounds terrible until you consider it as though you were in that situation.  What if you could increase your income by 20% by moving to a new state?  Nothing else in your life would change except your new neighbors would be smart enough to (1) not hate you for being successful and (2) not call you names for choosing to keep more of what you've worked hard to earn.  You'd move, I'd move and we'd do it today.

There is no patriotic duty to endure undeserved abuse at the hands of your government.  There is no patriotic duty to watch your government squander what you've poured life, sweat and effort into when you can prevent them from doing so.  It is not "deserting" to flee such abuse.

Instead of name-calling, perhaps Mr. Obama should consider urging congress to make our corporate tax rate competitive instead of punitive.