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Thread: Tax law may send factories and jobs abroad

  1. #51
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    Quote Originally Posted by Southern Dad View Post
    This win terrifies the Democrats. What are they going to run on? Are they going to go out and stump saying that they opposed these tax breaks that are resulting in people getting bonuses and wage increases? Are they going to run saying that they voted against doubling the personal exemption? Will they offer to roll all this back? Chrysler just announced they are moving some production from Mexico to Michigan. How do the Democrats combat this? $2,000 in bonuses to 60,000 hourly and salaried employees and crediting it to the tax overhaul? What is the Democrats message? Vote for us and we'll roll all this shit back?
    The new tax law will probably have quite an impact on the mid term elections.

    How much impact and what kind, remains to be seen.

    Both sides will claim the upper hand, as usual...

  2. #52
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    Quote Originally Posted by Miller47 View Post
    The new tax law will probably have quite an impact on the mid term elections.

    How much impact and what kind, remains to be seen.

    Both sides will claim the upper hand, as usual...
    Yes, but the votes are on the record. It is clear that every Democrat voted against it.

  3. #53
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    Quote Originally Posted by Supposn View Post
    Southern Dad, similar domestic and imported goods similarly contribute to our economy When they're under USA jurisdiction and handled by USA labor.
    Unlike USA produces goods, imports and their production supporting goods and services contribute little or nothing to USA's economy until they're loaded onto a USA carrier crewed by USA labor or unloaded at a USA port of entry.
    USA producers pay applicable USA taxes; their increased production contributes to their per unit cost reducing economies of scale. Similarly production supporting goods and service products, (including infrastructures) are usually derived from the nation that produced the products they supported.

    Bottom line: USA producers of products support USA's economy; producers of imported goods in aggregate effectively do nothing to support USA's economy.
    Unlike the USA, foreign nations generally collect taxes from importers of goods into their nation. They do not tolerate foreign producers gaining advantages over their own domestic producers.
    Southern Dad, USA producers do, and foreign producers do not pay taxes and contribute to USA economy.


    I'm among the proponents for the trade policy described by Wikipedia's “Import Certificates” article.

    Respectfully, Supposn
    Quote Originally Posted by Southern Dad View Post
    Spin it, knock it, talk all the shit you want. The US economy is doing great. Unemployment is at record lows, companies are announcing they are brining work back to the US. Did you hear that Ford is brining a production unit back from Mexico to Michigan? Spin that as bad. Corporations here in the US pay US income taxes. In the past they would keep money that was made overseas there to avoid paying taxes when they brought it here. We've lowered that tax rate and corporations, like Apple are saying the will bring that money home. Win/Win!
    Southern Dad, annual trade deficits are always, (more than otherwise) detrimental to their nation's GDPs and numbers of jobs; (Otherwise being if the nation had not experienced an annual trade deficit).

    In both richer or poorer years, trade deficits reduced their nations' GDP and numbers of jobs more than otherwise. Your response evades the post's issues of net economic consequences within each of all years.

    Respectfully, Supposn
    Last edited by Supposn; 12th January 2018 at 07:59 AM.

  4. #54
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    Quote Originally Posted by Supposn View Post
    Southern Dad, annual trade deficits are always, (more than otherwise) detrimental to their nation's GDPs and numbers of jobs; (Otherwise being if the nation had not experienced an annual trade deficit).

    In both richer or poorer years, trade deficits reduced their nations' GDP and numbers of jobs more than otherwise. Your response evades the post's issues of net economic consequences within each of all years.

    Respectfully, Supposn
    But they aren't, so you're wrong. The reason should be obviois too and you should stop arguing that the US trade deficit is harmful. Foreigners cannot invest more in America without putting upward pressure on the US trade deficit. The reason is plain: every dollar that foreigners use to buy dollar-denominated assets is a dollar that returns to America as investment demand rather than as demand for American exports. America’s capital-account surplus rises.
    Last edited by publius3; 12th January 2018 at 08:12 AM.

  5. #55
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    If the concept for a lower tax rate on foreign profits assumes that it will provide an incentive for companies to use and invest those foreign profits domestically, then, I would think it is a rather good idea. However, it such is the case, there is a missing stated requirement in the law. The law should specifically state that the amounts realized via the difference in the domestic rate and the foreign rate must actually be domestically invested to use the foreign rate. Such investments should generate increased domestic profits from increased domestic operations.

  6. #56
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    Quote Originally Posted by TheWahoo View Post
    If the concept for a lower tax rate on foreign profits assumes that it will provide an incentive for companies to use and invest those foreign profits domestically, then, I would think it is a rather good idea. However, it such is the case, there is a missing stated requirement in the law. The law should specifically state that the amounts realized via the difference in the domestic rate and the foreign rate must actually be domestically invested to use the foreign rate. Such investments should generate increased domestic profits from increased domestic operations.
    The rate differential wasn't the issue. The investment happened abroad, it genenrated taxes abroad and was taxed abroad.

    Now what?

    Well there's a multitude of choices of course but for purposes of simplicity we can limit the choices to repatriation and reinvestment abroad.

    Now if they choose repatriation, the US essentially imposes a "cover charge" on the money. This skews the decision towards reinvestment because its easy to avoid a tax on the repatriating dividend....don't issue one.

  7. #57
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    Quote Originally Posted by publius3 View Post
    But they aren't, so you're wrong. The reason should be obviois too and you should stop arguing that the US trade deficit is harmful. Foreigners cannot invest more in America without putting upward pressure on the US trade deficit. The reason is plain: every dollar that foreigners use to buy dollar-denominated assets is a dollar that returns to America as investment demand rather than as demand for American exports. America’s capital-account surplus rises.
    Publius3, foreign investing into USA producing enterprises are certainly desirable. A Toyota plant in the USA is no less domestic than a Ford or Chevy plant. A Toyota assembled in the USA certainly increases our GDP and numbers of jobs; when more portions of the vehicles' materials and components are domestic rather than imported, it's of greater contribution to USA's economy.

    But foreign purchasing of USA enterprise's shares do not contribute to those enterprise's USA productions (unless they are purchased from the enterprise itself or are initial offerings). Otherwise sales of enterprise's shares are only transfers of wealth and do not contribute to the nations' GDPs or numbers of jobs. Similarly, loans are just transfers of wealth. Governments' debts do not contribute to their nations' GDPs.
    Investors consider probable security of investments and rates of return; the nation's balance of trade has little or no effect upon investing decisions.

    Trade balances effects upon their nation's GDPs” paragraph within Wikipedia's “balance of trade”: Exports directly contribute and imports directly reduce their nation's balance of trade (i.e. net exports). A trade surplus is positive net balance of trade, and a trade deficit is a negative net balance of trade. Due to balance of trade being explicitly added to the calculation of their nation's gross domestic product using the expenditure method of calculating gross domestic production (i.e. GDP), trade surpluses are contributions and trade deficits are "drags" upon their nation's GDP.


    Also refer to Wikipedia's “Import Certificates” article.


    Respectfully, Supposn
    Last edited by Supposn; 27th January 2018 at 02:30 PM.

  8. #58
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    "Otherwise sales of enterprise's shares are only transfers of wealth and do not contribute to the nations' GDPs or numbers of jobs"

    They take the place of the original placeholder. And that transfer provides the liquidity for the shareholder to do something else with.

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    Quote Originally Posted by publius3 View Post
    "Otherwise sales of enterprise's shares are only transfers of wealth and do not contribute to the nations' GDPs or numbers of jobs"

    They take the place of the original placeholder. And that transfer provides the liquidity for the shareholder to do something else with.
    Publius3, ownership transfers of enterprises' shares are transfers of wealth. Transfers of wealth do not contribute to nations' GDPs.
    Standard & Poors' or Dow Jones index numbers will eventually be affected by, but do not affect the nation's GDP. Transfers of wealth are not factors of GDP calculations. When GDP refers to investments, they are referring to goods and services invested to production, not sales of stocks and bonds.

    Respectfully, Supposn

  10. #60
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    Quote Originally Posted by Southern Dad View Post
    Here's what the left has to fear. If President Trump's tax reforms are actually working; money is coming back into this country, employees are getting bonuses, employees are getting wage increases, unemployment stays low... NO one is going to want to go back to the way it was.
    Employees are getting raises because unemployment in low, and employers have to put more on the table to attract workers.

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