Obama To Propose 'Grand Bargain' On Corporate Taxes And Infrastructure

[Joel thakkar]

Source: Business Insider

WASHINGTON (Reuters) - President Barack Obama will propose a "grand bargain for middle-class jobs" on Tuesday that would cut the U.S. corporate tax rate and use billions in revenues generated by a business tax overhaul to fund projects aimed at creating jobs.
His goal, to be outlined in a speech at an Amazon.com Inc facility in Chattanooga, Tennessee, is to break through congressional gridlock by trying to find a formula that satisfies both Republicans and Democrats.

Efforts to reach a bipartisan "grand bargain" on deficit reduction have been at an impasse for months. Senior administration officials say Obama is not giving up on a big deficit-cutting package, but given that no agreement appears on the horizon so far, he is offering a new idea to try to follow through on his 2012 re-election campaign promises to help the middle class.

"As part of his efforts to focus Washington on the middle class, today in Tennessee the president will call on Washington to work on a grand bargain focused on middle-class jobs by pairing reform of the business tax code with a significant investment in middle-class jobs," Obama senior adviser Dan Pfeiffer said.

Obama wants to cut the corporate tax rate of 35 percent down to 28 percent and give manufacturers a preferred rate of 25 percent. He also wants a minimum tax on foreign earnings as a tool against corporate tax evasion and increased use of tax havens.








Read more: http://www.businessinsider.com/obama-to-propose-grand-bargain-on-corporate-tax-rate-infrastructure-2013-7

---

[vi5]

1. So I'm guessing a few responses to come on here

1) "There's no proof that's true!! It's just an unsourced quote and we have no evidence that he actuall wants a grand bargain!! This is just a journalist or source trying to divide Democrats!!!!"

2) "This is just a tactic on Obama's part!!! He's going to play the Republicans like a fiddle!!! They have no idea what they're in for!!! This is great news for us!!!!!!"

3) "Well what else can he do?!?!?! He needs a better Congress!!!! DONATE!!!!!! LET'S GIVE IT TO HIM!!!!!"

[Crow73]

4. Sourced quote

"As part of his efforts to focus Washington on the middle class, today in Tennessee the president will call on Washington to work on a grand bargain focused on middle-class jobs by pairing reform of the business tax code with a significant investment in middle-class jobs," Obama senior adviser Dan Pfeiffer said.

I agree this Congress is crap, but this deal is bullshit.

[cstanleytech]

9. "I agree this Congress is crap, but this deal is bullshit." Why is it BS exactly?

[Crow73]

44. Well if you can't see it

nothing I say, anyone here say, or source showing that this deal is bad for the country will change your mind.

[phleshdef]

54. I don't think you understand whats actually being proposed.

Large corps don't pay anywhere near 35% now, because of loopholes that allow them to stash money elsewhere. The President wants to close those loopholes as well as cut off subsidies for big oil, etc. The end result would be that corporations end up paying more in taxes than they have been for ages.

Nothing is going to get passed anyway, but if it did, it would have the opposite effect that many in this thread are suggesting.

[cstanleytech]

65. What I am seeing is the part where the article states

"He also wants a minimum tax on foreign earnings as a tool against corporate tax evasion and increased use of tax havens."
So, why do you believe that idea to be BS?

[wordpix]

72. I'm for that part and ENDING the tax evasion/tax havens altogether

However, do you really the Party of the Rich will agree to this? Corporate tax evasion and tax havens are the reason the Mitt Romneys of the world are getting richer by doing no work.

[cstanleytech]

73. Depends, if they want a repeat of what happened in 1789 then by all means they should proceed

full steam ahead with their current Titanic course, if on the other hand they dont want a repeat of 1789 then they will support real reform and close the loopholes and stop allowing corporations to evade paying taxes.

[railsback]

8. Looks like you got your SnowdenWald on

Maybe try taking a deep breath and realize that the effective U.S. rate is around 10%. He could offer up a cut down to 20%, close some loopholes and still come out ahead of where we are now.

Way to undermine Greenwald even more.

[East Coast Pirate]

15. They do so much for us,

why tax them at all?

[Crow73]

2. Well that is stupid

Why not just force government contractors to pay $20+ or just get rid of the middle man?
That will create middle class jobs.

Great post!
Thank you



Bad Business: Billions of Taxpayer Dollars Wasted on Hiring Contractors

[diabeticman]

3. IF THIS REPORT IS TRUE: HOW THE HELL IS THIS GOING TO HELL MIDDLE CLASS JOBS?

THis is the type of B.S. Repugs like Gingrich have been pimping for years. Give Corporations a lower tax rate and they will hire more American workers.

[daleanime]

7. Don't you know.....

the last 30 years have shown it to be true; if you make the rich richer, the poor can take of them selves.

[RC]

10. We are already seeing the effects of lower taxes on businesses.

Higher profits, resulting is a booming Wall Street and more pay and bonuses for the CEO and lower wages for the worker.
And now Obama wants more of this? No thanks. Grand Bargain, my ass. Not for us commoners, it ain't.
When are we going to stop believing this shit of lower business taxes helping the economy and the middle class?

Raise taxes on those that can afford it. Use the money gained to help those that need it. Tax Wall Street and use that money to help Main street. The more money circulating on Main Street, the better the economy over all. Done correctly and the single job, one income family will become the norm again.

We need to do what we did after WWII. The taxes were high and the economy boomed and people could afford to get a college education, without condemning their future to huge piles of debt.

[diabeticman]

12. My wife moaned: "Stick a Fork in me and call me done!" He (Obama) might as well change the D

beside his name to an R. THIS is the type of bull crap she had to pimp when she was a telemarketer and she had to call for Gingrich's Pet Project Reclaiming America. This plan is one of Gingrich's Keystone talking points.

[maui902]

17. We haven't seen the details yet, but the bargain for the middle class

Appears to be the call for a "significant investment in job creating programs"; in other words, some sort of stimulus program to create more jobs that the Republicans have beamed blocking for some time. The proposal does not seem,-as some here have concluded, one based on creating jobs through lower taxes on corporations. The deal would result in lower tax rates, which the Republicans and many in the business community want, but offsets the lower rates with a call for taxes on foreign income that currently escapes taxation in the US. The last part is key since allowing corporations to operate in the US but shift income to other countries with lower tax rates reduces the revenue we need to support job creation programs for the middle class. I don't think it will get much traction in Congress because Republicans and the business community will object to the tax offset proposals, but it seems the Obama administration wants to force Republicans to react to a proposal that "lowers corporate tax rates" in exchange for a stimulus program to create middle class jobs, two proposals that Republicans used to support. I'd like to see the details of the stimulus program before forming an opinion, but I don't see this as a sellout as some have suggested.

[zeemike]

20. That is TP 2 in the first post in this thread

We have heard that argument before...but welcome to DU anyway.

[maui902]

48. Not sure I understand your response

I agree none of the arguments are new, but do you disagree that we should have more stimulus designed to create jobs? Would you object to a program that allocates funds to build/repair infrastructure?

[zeemike]

50. The point I am trying to make is that there is a disconnect

Between what is said and what actually happens.
And in the end it is always a big give away to big business, who to thank us lowers wages or hires illegal immigrants to replace us in the job market.

Creating more jobs that you cannot live on what is paid is not helpful except to the "job creators", who charge a lot for what they make and put the savings in labor cost in their pocket...note how the stock market keeps going up, while the middle class and wages go down...and Obama has not slowed that down much less stooped it.

[maui902]

57. Agree that trying to get something done is a challenge

And I also understand the concern about giving up too much to get too little, but as a proposal, I don't have a real issue. Some of the posts in this thread seem to assume that the administration has proposed lowering corporate taxes as a way to stimulate jobs, and I don't read the proposal that way. While I fully expect the Republicans in Congress to reject the proposal (because (i) it contains offsets that wholly or at least in part would increase tax revenue from certain corporate entities (those with offshore income not taxed in the US or that rely heavily on certain subsidies); (ii) any stimulus, at least in the eyes of the Republicans, is "bad" because it increases the deficit; and (iii) it would give Obama a "win&quot , I doubt the President will give too much on this issue. Time will tell.

[zeemike]

59. Time will tell.

But that is how triangulation works...Obama offers them what they want along with a little bit of what we want...they accept what they want and reject what we want or through us a bone that don't have any meat on it and Obama tells us that is the best he could get.
The net effect is they win and we lose again...and they have been pulling this on us for years...even when dems had control of the congress...
If you don't ask why this is you have blinders on.

[maui902]

61. What would you propose then?

Just curious how you would handle the current situation given the realities that can't be changed (Republican-controlled House, no filibuster proof majority in Senate), at least not until the next election, when things could get worse if the job situation doesn't improve. Or are you just recommending that any proposal such as the most recent one be non-negotiable, which is likely to result in the status quo?

[zeemike]

62. I propose we stop fooling ourselves.

The corporate powers own the government and our politicians, and until and unless we take back the democratic party by actually participating in it...that is on the local level as well as national ...they will continue to play us for suckers.

And things will continue like this....a constant move to the right with some in our own party enabling it...probably because it pays really well...and we will be told that we need to give to the party so we can compete against the big money that owns the system....another sucker suggestion because no matter how much we give we can never match what the PTB offer them.

Sorry but they fooled me twice and I no longer buy the shit any more...really the best option is a general strike that shuts down this country and stops the flow of money...that is the only thing that would hurt them...but that can never happen when so many have been scared to death of losing what little they have...so the only real practical solution is long term of grass roots taking back the party...And I may never live long enough to see it.

[maui902]

63. I gather you believe that there are enough voters who share your position

to make a difference. Even if we find a solution to gerrymandering, I would not agree with that position. I've seen too many polls, and talked to too many of my friends and co-workers to believe that there is this huge block of voters who share (all) your beliefs. On the other hand, I believe there is a significant majority out there, if motivated, who would vote for candidates who are mostly progressive. And my mostly progressive, I mean those who would vote generally for progressive policies, but who are not as liberal as you and others would prefer. For my part, I'm just of the mind that I'd prefer Barack Obama, even with the flaws he's exhibited so far, to someone like Mitt Romney, and I think a more liberal candidate is more likely to lead to a Republican President than a more liberal Democratic President. Just my humble opinion.

[zeemike]

67. Well again it always comes down to triangulation

The parties offer us two choices...a Dem that talks the talk but always gives in on the important things, and a bat shit crazy free market radical...who you going to pick eh?...move further to the right.

The ACA is a good example...what we needed was single payer, but that was took off the table right from the start and instead we were offered Romney Care.... which as a GOP dream, to get everyone to buy insurance from the insurance companes....take that or nothing
And the GOP played us like a fiddle...ran around with hair on fire saying Socialism, Marxism...(even thought it was exactly the opposite of that) and making a big fuss over it so that we would think it must be a good thing and support it...then after a fuss they voted for it and we got what they wanted really...something that funneled money to corporate interest and now are picking the parts out that they don't like, and we will come down to a system where the employer does not provide it and we are on our own and must buy it from the insurance company.

Well it may well be hopeless, because we now have our own trying to convince us that if we run a real progressive we will lose to bad cop, and bad cop is really bad...so we had better go with Hillory...who they know will give them what they want.
Nope if we do not take back the party from the third way democrats we can expect to see Ayn Rand's dream come true...the Oligarchy and the slugs...and most of us will be the sluggs.

[Kolesar]

52. Thanks for writing. Sorry about the airplane glue

...sniffers. This place is full of them.

[John2]

33. He should

leave things alone, and let it play out. There are jobs in this country. They are just not hiring. They will probably take that extra money and pay for more wars. Why don't he just take the money from buying more weapons or building defense shields in other countries to stimulate the economy? This is just bait and switch. When a service is needed, people create their own jobs. He would do better in stimulating the economy by going after Wall Street monopolies and prosecuting therm. That will open up a lot of new jobs. He can break up some of these networks, that have one person in two and three or more management positions at the top also. Especially when it causes a conflict of interest.

[JaneyVee]

38. This can easily work for 2 reasons:

One, no corporation actually pays a 35% tax rate, so lowering it to 28% is just an illusion, meaning the Republicans will actually get nothing out of this deal. Two, infrastructure on the other hand is one area that can make the economy boom. Spending money on infrastructure puts millions back to work, not only in the construction sector, but the manufacturing sector as well. And these are good middle class jobs. Good wages, good benefits, etc. the only thing I would add is that any infrastructure we do should use parts ONLY made in the USA.

[phleshdef]

53. The truth is, large corps would pay MORE in taxes than they currently do...

...if they actually closed the loopholes that allow tax evasion which is what the President is referring to.

[Bonhomme Richard]

5. We all know that the part about the tax cuts will pass and.....

the part about tax havens will not.
The bottom line. Businesses only hire people when they need them...tax cut or not.

[JaneyVee]

39. Infrastructure repair means we don't have to wait for business to hire.

We can create a demand right now by rebuilding America. That will fire up steel mills and put construction workers back to work.

[Sunlei]

6. long as the corps who get the tax breaks HIRE AMERICAN CITIZENS. (citizens work on usa soil)

none of the tricks where they call imported foreign labor 'jobs'

[SHRED]

11. The GOP won't go for this

Obama wants to do away with corporate tax benefits like oil and natural gas industry subsidies, special breaks for the purchase of private jets and certain corporate tax shelters. He also wants to impose a minimum tax on foreign earnings, a move opposed by multinational corporations and perhaps the most contentious provision in the president's plan.

http://www.huffingtonpost.com/2013/07/30/obama-grand-bargain_n_3675512.html

[JoePhilly]

18. Few on this thread will see that paragraph ...

... or understand it.

Because it gets to the point that those benefits take the current 35% rate and effectively drop it to something around 20% or less.

So a drop in the overall rate to 28% along with removing those deductions has the net effect of raising taxes on big business.

Which is why the GOP won't go for it.

But any mention of that would act to mute the outrage.

[railsback]

19. This is true

Corporations get away with paying hardly anything. The tax rate could drop even further, and we'd still come out ahead by removing some reductions.

Someone, who's name shall not be named, has made this a faux outrage board.

[riqster]

31. Yes, and taxing overseas profits is completely ignored. nt

[CanonRay]

13. All I know is, when the smoke clears

the Middle Class will get fucked. Again. I'm sure that is not Obama's intent, and he's doing what he can by proposing something he thinks will help, but by the time the corporate owned Congress gets done with it, we'll get screwed again. Wish I had more faith, but I've seen nothing but this for over 30 years.

[BlueJazz]

14. Any more of these "Bargains", "Deals", "Grand Bargains" and the 99percent will look like >>

[Elmergantry]

16. We should instead tax businesses

100%.

[railsback]

21. Ah, India, corporate tax rate of 33%

Doing wonders..

[BlueJazz]

27. India's rate is 30 % which is lower than Belgium, Australia, France, Germany, Italy, Japan.

I (personally) believe it has more to do with greed and a non-feeling of togetherness than tax rates.
But..I'm open minded about it all...

[railsback]

32. Tax rates are a tad different

http://www.kpmg.com/global/en/services/tax/tax-tools-and-resources/pages/corporate-tax-rates-table.aspx

But, yes, in the end, it all depends with what you do with it. The effective U.S. corporate tax rate, after loopholes, is around 10%, probably the lowest in the world. While individuals pay over $1 trillion a year, corporations pay about 1/8 of that, so dropping the tax rate down to 27% and closing a loophole here and there still ends up as an increase.

Obama could offer to cut it down to 20% and it would still get rejected because the GOP knows its actually a rate hike.

[BlueJazz]

34. Oh..I see. You obviously know what you're talking about. My Physics degree lets me..

..(kinda') understand why we are probably just holograms on a quantum surface but helps little with dealing with many tax codes and circumstances.

PS: Even if we are holograms, it hurts if we get hit by a Truck.

[nolabels]

56. Don't blame the truck

As a truck mechanic for the last 35 years i can say they are safer than they have ever been (probably thank the lawyers for that fact).

A word for the wise, no matter how safe always be cautious because the worst scenario can always happen

[DeSwiss]

24. That picture should make anyone who sees it......

...ashamed to be human.




''It has become appallingly clear that our technology has surpassed our humanity.''
~Albert Einstein

[DeSwiss]

64. It's none of your business.

I-bin.

[abelenkpe]

22. Tax cuts don't lead to increased local jobs for Americans?

Without a mandate to hire workers in this country isn't this just more free market trickle down faith based baloney?

[Elmergantry]

23. Yes

If Obama truly wanted to make a "grand bargain", then cut the tax rate in exchange for an substantial increase in the minimum wage.

[n2doc]

25. It really doesn't matter what he proposes

The repubs will automatically oppose it. He could propose cutting corporate taxes to zero, and offset it by eliminating food stamps, medicaid and all other social spending, and they still would oppose it. And criticize him for hurting poor folks as well. They are shameless and worthless.

The only thing left is for dems to attack the do nothings, constantly and without remorse, for their obstruction and malice.

[Thav]

26. I have a better idea.

Raise the top tier tax rate by 5%, make the first 30k of income tax-free. Leave everything else unchanged.

That'll pump 280 billion into the economy and be completely revenue neutral - but actually may be revenue positive at this point since I came up with that based on 2008 numbers.

Everyone gets a tax cut, and only those with income in the top tier of the tax bracket will see any effect. This puts money into the pockets of people who need it and are most likely to SPEND it. Not invest, SPEND.

Also, does anyone else cringe when they hear "Grand Bargain?" Republicans don't bargain.

[BlueJazz]

29. "Republicans don't bargain" Amen to that.

I do like your plan. I thought of one somewhat like that but the tax was 10 % instead of 5.

[FreakinDJ]

28. Cut Corp Tax breaks that Outsource American Jobs

And we wouldn't need a Jobs Bill

Or is that asking too much Mr President

[John2]

37. Most if not

all of his advisors are from Wall Street or Corporate America. He doesn't take any advice from the Liberal Left. When Obama talks to the corporations or Republicans, he says they in relations to us. He does not say we. He is suppose to be part of us. When he wanted our votes, he claimed he wanted to work for us. He needs to remember that. If his advisors from Wall Street is telling him something different, then fire them and hire somebodyelse. He don't even have to send them to Congress if they don't want to confirm them.

[JaneyVee]

40. Obama and Dems did that already, GOP voted it down:

http://www.bloomberg.com/news/2012-07-19/senate-republicans-block-democrats-anti-outsourcing-plan.html

[DeSwiss]

30. God no! Not another Obama bargaining session?!?!

- When this guy bargains it's time to put on your waders......
[center][font color=white] ........................... [/font]
99%'s Bargain <---------------------------> 1%'s Bargain[/center]

[L0oniX]

35. Trickle down economics by any other name ...is still trickle down economics.

How Reaganish is this pile of shit. ...and a minimum tax on foreign earnings so they won't try to evade taxes? Holy bull shit WTF and FFS He must be smoking some bad ass shit!


Hey how about you fucking cut my tax rate.

[Kingofalldems]

36. Yeah, but I thought Obama was a Communist and a Muslim?

[Hydra]

47. Only in the minds of the stupid

I cringe whenever I see any of those things.

"I reject your 'reality' and substitute my own!"

[Octafish]

41. Reaganomics for the 21st Century.

Trickle down by any other name only helps the plutocrats and their satraps.

Before Reagan, corporations were the ones carrying the lion's share of the IRS load. After Pruneface, it was the middle class.

[Myrina]

42. BOHICA, Working Folks ...

Wall Street and the Corporates need more tax breaks. Sorry that you want to feed your families and have lights/heat in the houses that you will probably be losing in the near future, working schmucks, but the Rich need to get Richer and be regulated and taxed less.
Just look at the thousands, nay MILLIONS of high-paying jobs they've created in the last 13 years! Our freedom and democracy depends on the rich being even more obscenely wealthy than all the rest of the world combined. Give til it hurts, wage earners!!

[AAO]

43. Fuck the Grand Bargain crap! I'ts only a bargain for the pukes, otherwise they'd never take it!

[customerserviceguy]

45. If politics is the art of the possible

I say give it a try. With a targeted jobs tax credit incentivizing business to take a second look at the resumes of the folks who have been out of work for two years, this would work. Capturing taxes on income currently offshore would indeed pay for it.

[Uncle Joe]

70. I believe that's precisely what it is.

If politics is the art of the possible

Obama knows the Republicans would never support a reduction in the corporate tax rate if off shore taxation loopholes were eliminated enough to offset said rate reduction thereby increasing governmental revenue at the expense of mega-corporations currently using off shore means to eliminate or reduce its' actual taxes paid.

The Republicans would never grant Obama such a victory, but come 2014 this proposal to reduce corporate tax rates will neutralize any Republican claim that Obama (Democrats) are anti-business.

[phleshdef]

46. He proposed this same thing the past 2 SOTU addresses.

And its not a bad idea, if you cut the corporate tax rate and close evasion loopholes, the big corporations will end up paying more in taxes than they have been for ages.

People in this thread are a kneejerk bunch though, that's for sure.

[AnotherMcIntosh]

51. Finally, someone who gets it. Close the "loopholes" (whatever that means) and the greedy

will pay more taxes, or at least some taxes.

[wordpix]

74. O should forget a bargain, he's in his last term & 'pukes love their obstructionist ways

O should not be talking bargains with this repug crowd of thieves, liars and con artists. He should do presidential signing statements like * did and invoke his commander in chief role and otherwise do what he can legally do to stop the tax evasion & tax havens, which basically amount to corporations not paying bills for services rendered by government---environmental cleanup, highway maintenance and improvements, safe airlines, are just a few that come to mind used by corporate thieves.

[phleshdef]

75. Signing statements can only go so far, its not going to make any real impact.

[Xyzse]

55. Need more details on this before I say if it is good or bad. Track Record though trends negative

From what I understand of the article:

Cut down Corporate Tax Rate from 35% to 28%, while setting up a minimum tax rate on foreign earnings. Unless that is a minimum of 30%, I don't see that really helping.

Manufacturers Tax Rate at 25% here may work a bit, if they ensure that they actually make sure that the employees are taken from the US.

I would say, the better solution would be to increase the tax rate, but give them incentives to provide training for their workers. See, the problem with current companies right now, is that they got rid of the idea of having employees gain experience from working. They want workers with the papers that say they have some sort of experience, and don't deal with people just breaking in to the business.

In other countries, Companies take in new people but provide training for a few months so that they can perform their job properly. Here, they expect to pick someone out and automatically plug them in to the job, given supposed job experience. They want people who has had 10 years of experience on certain things, but that becomes a smaller pool of workers, when people can't break in to it to begin with from college. So they take it from out of the country. That just doesn't make sense.

In the article Obama: "wants money generated by the tax overhaul to be used on a mix of proposals such as funding infrastructure projects like repairing roads and bridges, improving education at community colleges, and promoting manufacturing, senior administration officials said"

The problem I have with that is that, is that there is no guarantee that there would be money generated by the tax overhaul. From the current GWB tax cut, we created a damn deficit. It is money paid in to a tax cut rather than anything else. So I don't believe he will have any money generated to improve infrastructure at all.

This is close to the same trickle down zombie economics that he supposedly campaigned against, packaged in a different way.

It may still work if it is composed well, such as:

1 - Cut Corporate tax rate, but make sure that there is indeed a minimum effective tax rate given all the loop holes that companies can use.
2 - Like I said, create an incentive for companies to hire new workers out of college/school by paying for part fo their training to do the job properly. This would help a little bit to mitigate the outsourcing and hiring talent from outside the country. It would also increase the quality of the work force.
3 - If the new method was able to generate more revenues, then infrastructure spending could happen. Infrastructure spending should be done any way regardless.

[onestepforward]

58. Nothing will get done

and people like me will continue to drop out of the middle class and suffer on a daily basis just trying to pay basic bills and food.

Obama can do nothing with this Congress and I cannot foresee any changes in the near future.

I feel sick and all I can do is cry.

I'm out of hope.

[DeSwiss]

66. That's one possibility.

Or we could take heed of the wise Lakota Chief's words (your sigline) and return to nature. Simplify our lives.

[onestepforward]

71. I'm trying my best.

Some days are just so hard.

[forestpath]

60. What a crock. If Obama really cared about American jobs he wouldn't be

pushing the TPP. That says it all about what he really thinks of people who have to work for a living, which is most of us.

[GeorgeGist]

68. Manufacturing outrage should be taxed 100%.

[1StrongBlackMan]

69. From the comments …

It is clear that the loudest nay-sayers (i.e., calling this proposal “trickle-down or 21st century reaganomics), either didn’t read the article (as scant as it is), or don’t understand what is being offered.

[Major Hogwash]

76. Rethuglicans turned it down, out of hand, simply because President Obama was for it!!

Every time President Obama is for something, the Rethuglicans line up against him and say "No" every single time.

President Obama knows that is what the Republicans will do, so he is making all these speeches so that the American people can see that he is not the problem in Washington, D.C.

President Obama should call this tour, "The Spotlight on the Cockroaches" tour because he sure is putting the spotlight on the GOP!!!