[SIZE=14pt]Good or Bad?? Comments, please.
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[SIZE=14pt]The Nation Online - Blog
[SIZE=14pt]Posted <st1:date Month="8" Day="3" Year="2007" w:st="on">8/03/07</st1:date>
[SIZE=14pt]William Grieder
[SIZE=14pt]Now here is a Patriot Act everyone can get behind. It's called the Patriot Corporation of America Act and it
[SIZE=14pt]rewards the companies that don't screw their employees and weaken the country by moving the jobs to China and elsewhere.
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[SIZE=14pt]In these troubled times, doesn't that sound like common sense? Government policy presently works in opposite ways. It literally assists and subsidizes the disloyal free riders who boost their profits by dumping their obligations to the home country. It's called globalization. Establishment wisdom says there is nothing politicians can do about it.
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[SIZE=14pt]But the bills introduced Thursday by three senators and seven representatives, all Democrats, can begin to reverse this political perversity. Don't expect a roll call anytime soon, but I think the governing principle is pivotally important.
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[SIZE=14pt]And some Democrats have come up with a potent new version of patriotic politics. While the nation is fighting this ugly, costly war in Iraq, employers should be doing their part to defend the homeland. Will Republican warriors want to vote against that?
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[SIZE=14pt]The House and Senate bills appear to  differ slightly but pursue the same goal. In the House, a "Patriot Corporation" would get tax breaks and preferences in federal contracting for employers who produce at least 90 percent of their goods and services in the US and with American workers. The companies must invest in research and development domestically, provide adequate health care and pensions and--surprise--comply with federal laws like workplace safety, environmental protection and consumer regulations.
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[SIZE=14pt]The Senate's "Patriot Employers" version would give a 1 percent tax credit on taxable income for companies that maintain or increase their US employment in relation to their overseas workers. They must also keep their corporate headquarters in the US. The Senate bill adds a "living wage" requirement. Its initial co-sponsors are Sherrod Brown of Ohio and Dick Durbin and [SIZE=16pt]Barack Obama of Illinois. Obama's sponsorship[SIZE=14pt], I would guess, may attract other celebrated names.
[SIZE=14pt]House co-sponsors are the same nucleus of progressives pushing party leaders to undertake a thorough revamp of US policy on globalization and trade. They are Schakowsky and Hare of Illinois, Sutton and Ryan of Ohio, Woolsey of California, Kagen of Wisconsin and Ellison of Minnesota. Senator Brown and Rep. Jan Schakowsky endorse both House and Senate versions.
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[SIZE=14pt]The principle at stake is straightforward. Multinational corporations cannot continue to have it both ways--moving more and more value-added production and jobs offshore to capture cheap labor, while still enjoying all of the rewards and benefits of claiming American identity. It's not just the outrageous tax breaks. The American military defends their freedom to operate around the globe.

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[SIZE=14pt]These measures can be the beginning of tough new policies on globalization. They are quite limited in
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[SIZE=14pt]scope, but a good start. Thousands of small to mid-sized manufacturing firms that do not offshore their
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[SIZE=14pt]production should salute the initiative since the incentives are intended for them. The rewards are modest
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[SIZE=14pt]gestures at this point. The real fight begins when Congress proposes penalties--higher taxes--for those
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[SIZE=14pt]unpatriotic companies that left home.

Bad.  Very, very bad.  I can't even wrap my head around all the bad assumptions this bad policy is based on, right now.  So, for now, I'll just throw out this one point: It has been, in part, "compl[iance] with federal laws like workplace safety, environmental protection and consumer regulations"  that has forced businesses to move operations overseas.

I think I understand why you ask the question.  After all, who wouldn't want American business to stop going overseas?  Who wouldn't want to create incentives for American businesses to remain here?

One problem is that this guy hasn't a clue as to why businesses move operations overseas in the first place.  He has no intent to solve the problem by addressing the underlying issues that caused the problem (if you consider it a problem).

Another problem is that it won't work.  The guy even talks about additional requirements to force these corporations to pay whatever Congress (not the market) determines to be an adequate "living wage", to force them to pay pensions, and to force them to provide healthcare.  These additional requirements are going to magically make companies want to stay? Hardly.  They'll clearly force more companies and jobs overseas.

This is one of the most monstrously communist proposals I've ever seen.  To propose this requires an ABSOLUTE and TOTAL IGNORANCE of how market economies work.  

I haven't even scratched the surface on what's wrong with this proposal.  It's actually making my head hurt.

I must take my leave now.