Thursday night in Iowa the GOP candidates debated each other and put forward their tired, old failed plans to jump start our economy. They told America needs to lower taxes, de-regulate and repeal certain programs. They claimed that China is gaining all of our jobs, because we tax business too much. Unfortunately for their tired talking points, the CATO Institute, which is a libertarian publication with a very strong conservative following, thinks differently.
Back in 2007, CATO published this article, titled “The Global Race for Lower Corporate Tax Rates”. Once you get through the rhetoric and fabricated talking points, they solidified the progressive’s argument without even knowing it. In the second to the last paragraph they wrote,
China also has some challenges. Canada’s CD Howe Institute estimates that China has the highest effective corporate tax rate of all major economic powers (though the tax rate recently was reduced to 25 percent as part of a reform package, so China’s position presumably will improve when new rankings are released). But that is not the only problem. In an effort to determine which tax systems were easy to obey and which ones made compliance difficult, the World Bank looked at the business tax systems of every significant nation, and ranked China among the ten worst.
According to CATO, CD Howes Institute in Canada and the World Bank, China has the highest effective tax rate in the world and is among the ten worst countries for business tax systems, yet businesses are still flocking over there by the thousands. America has lost TEN THOUSAND factories to that HIGH TAX country of China. Why would companies go to such a high taxed country, if HIGH TAXATION drove them from the United States? Oh, wages, which is exactly what the PROGRESSIVES HAVE BEEN TELLING AMERICA FOR 30 YEARS.
So, the Republican party needs to either deal with this reality or start talking about the real reason why business leaves to go to China, and that is wages.
The Republican party consistently talk ad nauseam about American exceptionalism, but fail to promote the American exceptional standard of living that is being driven down by their infatuation with low wages, free trade and China.
This article, by an institution that promotes the conservative and the Republican agenda, unknowingly just gave the biggest blow to the conservative agenda and they didn’t even know it.