The neoliberal fantasy that low taxes for the rich, and the corporations that they own, generate wealth for the entire society has never been so obviously untrue. Still they, with neoconservative blindness, continue to push it and austerity (for everyone but the rich) as the only solution to the problems it created.
The following is a re-posting of an article on PoliticusUSA.com about the reality created by the tax cuts trumpeted by Harper and his ilk. Tax cuts that are supposed to be good for the economy, not corporate shareholder profits. But what do you know, many Canadian companies are known to be sitting on cash with no sign of even considering investing in the society they took it from. The one that gives them tax breaks for hiding taxable profits in tax haven shell companies and for employing sweatshop labour overseas to make that profit.
Canada Proves Conservatives Wrong by Cutting Corporate Taxes By 30% and Still No Jobs
Tax cuts create jobs. Paul Ryan and the Republican nominee Mitt Romney told a group that Canada just cut their corporate taxes to 15%.
Paul Ryan was obviously insinuating that these tax cuts put America at a disadvantage, and that the Canadian economy is going to explode and take all of our jobs. Corporate taxes in 2006 were already just 21%. In January 2011, Canada cut the corporate tax rate to 16.5%, then cut them again to 15% January 2012.
Overall, Canada has cut corporate taxes by almost 30% in 6 years.
The only problem is, the Canadian economy isn’t blasting off at all. It is still stuck in an anemic recovery. just like the United States. The Canadian economy only grew 1.8% in the second quarter of 2012. The United States on the other hand has a much higher statutory corporate tax and the economy grew at 1.7% in the same quarter. How can this be? Higher taxes hurt job creation, right? Yet both countries are stuck in the same slow recovery.
Unemployment in Canada has only dropped 1% since the recession ended, less than the drop in the United States which dropped almost 2%.
Unemployment should be dropping like a rock in Canada, not staying pace with the United States.
So for the last 3 years, 2009- 2012 the Canadian economy has failed to produce jobs at a healthy clip, even though corporate taxes are on the verge of being the lowest of the G7 countries.
Compare your Personal Tax Rate to the standard tax rate of Corporations in Canada, which are between 10-15 percent. This is why there is a deficit and Harper is following the old conservative cut-back trail, the only route they know.
- 15% on the first $42,707 of taxable income, +
- 22% on the next $42,707 of taxable income (on the portion of taxable income over $42,707 up to $85,414), +
- 26% on the next $46,992 of taxable income (on the portion of taxable income over $85,414 up to $132,406), +
- 29% of taxable income over $132,406.
The following article from PoliticusUSA.com further describes the neoliberal lie. A lie which Harper continues to shove down Canadian throats with single-minded neoconservative fanaticism, despite the obvious evidence to our south of its destructiveness. Deregulation is idiocy and self-regulation in business a joke.
How Corporate Conservatives Have Lied To Us For 30 Years
A conservative doesn’t complain about paying $5-10K for his country club dues, even though he never uses those facilities, but he complains about taxes being used in our schools that he doesn’t use, our libraries or council on aging.
The lie that we hear every single election year is that the corporations are paying too much in taxes, that’s why the middle class is hurting and that is why our factories are closing. The liberals raised taxes to much on the businesses and they went off to greener pastures. Again that is the LIE they have sold us. Look at this picture and read this World Bank article.
This illustration shows that the effective tax rate, (the amount actually paid to the government) in the U.S.A is substantially LOWER than Italy, Japan, Brazil, CHINA, INDIA, Canada and Germany.
Notice my emphasis on China and India. Most of our jobs are leaving to Countries and the have a HIGHER effective tax rate.
So why do conservatives continually beat the drum on taxes? The answer is simple, if they actually told you the REAL reason they would NEVER get elected.
These companies that shipped American jobs overseas are looking for CHEAP labor. It’s not the taxes at all. The conservatives know this, but if they blamed the American people rather than taxes, there would be riots on the streets and you would never see another conservative elected to office.
More and more American companies are hiring overseas rather than here in the U.S.A., according to an AP report.
More than half of the 15,000 people that Caterpillar Inc. has hired this year(2010) were outside the U.S. UPS is also hiring at a faster clip overseas. For both companies, sales in international markets are growing at least twice as fast as domestically.
All but 4 percent of the top 500 U.S. corporations reported profits this year, and the stock market is close to its highest point since the 2008 financial meltdown.
The report focuses on emerging middle class markets in China, India and Brazil. As we have stated above, the effective tax rate in those Countries are higher than here in the U.S.A, yet the economy is moving and the American companies are hiring in those “high tax” countries. Obviously, the HIGH taxes had little to no effect on their hiring practices. The conservatives here, stateside have told us differently.
Essentially, THEY LIED! They knew all along what they were doing.
The conservatives have sold us down the river. They have covered up for their corporate friends, as they shipped our neighbors’ jobs overseas and placed blame on our government and the “taxes.”
The fact is, the American labor force makes too much money, our standard of living is too high. The companies that move overseas are looking to increase their profits at the expense of the American people.
I believe it’s time for a real “tea party” and dump the Corporate Tea overboard along with the conservatives who covered the backs as the corporations sold us out.