Kerry's Corporate Tax "Cut"

The NY Times gets better quotes on the economics; the WaPo is better on the politics - geography rules, even in this interconnected age.

Excerpts:

Many independent economists questioned Mr. Kerry's underlying assumption that the tax code plays a significant role in corporate decisions to set up factories overseas.

"My sense is that it is not usually the decisive factor," said Edward McKelvey, a senior economist at Goldman Sachs. "Normally, companies go offshore either because of cost reasons — labor costs, materials costs — or for market access reasons. Countries tell you that if you want to sell here, you need to be here."

Campaign officials acknowledged that the new plan would not stop the broader trend of outsourcing jobs to low-wage countries. But they said it would at least remove what they called a bias in the tax system that encourages such practices.

and:

"The most salient feature, or at least symbolic feature, is the corporate tax rate [cut]," said Roger Altman, a top economic adviser to Kerry. "When is the last time you saw a Democrat propose a corporate tax cut?"

Comments

[Patrick R. Sullivan]

The always informative Steve Antler draws a picture for us at:

http://www.econopundit.com/archive/2004_03_01_econopundit_archive.html#108034273645708372

"normal recovery job growth, without tax tinkering, equals roughly the employment the Kerry group claims will be "created" by their tax plan. Over roughly the period of time traversed by the upcoming administration regardless of party, as things stand now the economy will all by itself create the same number of jobs Kerry's tax plan purports to create."

Go to the link, see the picture worth a thousand word political position paper.

[sophy]

Welcome to our game world, my friend asks me to buy some knight noah .