Congressional Democrats’ report paints bleak picture of 2004 results while Obama Jobs Council member stumps for another tax holiday.
Senate Democrats are attempting to drive the final nail in the coffin of the prospects for an HIA 2.0, which corporate lobbyists have been slavering over for the past several years. But Laura Tyson, formerly an economic advisor to President Bill Clinton, and now a member of the Obama Administration’s jobs panel, issued a countering report that argues for another tax holiday.
The Democratic members of the House Permanent Subcommittee on Investigations issued its report last week. It says that the 15 companies that took the most advantage of the 2004 tax holiday cut over 20,000 jobs, increased executive compensation and reduced the pace of their research spending – exactly the opposite of what HIA boosters said would happen then, and are saying would happen today.
In 2004, 843 companies brought back $312bn of overseas cash, the report states. Pfizer, the biggest beneficiary of the 2004 tax holiday, repatriated $35.5bn and cut 11,748 US jobs in the three years that followed, it states.
However, prospective corporate tax avoiders got a boost in their game of chicken with other US taxpayers from Tyson’s study. In it, she claims that a tax reduction on the scale of the 2004 measure would make “$942 billion available for domestic use by US multinational corporations.” Given their behavior in 2004 (and the fact that many corporates are already stuffed full of un-invested domestic cash), it is unclear whether that “domestic use” will serve any public interest.