Hillary Clinton spoke at a campaign rally for Massachusetts Democrat gubernatorial candidate Martha Crowley on Friday. During her speech, Clinton informed the audience that—contrary to what they may have heard—corporations and businesses do not create jobs.
The inevitable backlash was well deserved. One liberal columnist called her statement “dumb” and “stupid.” Commerce Secretary Penny Pritzker simply responded, “Yes, the private sector creates jobs.”
At a campaign event for New York Rep. Sean Meloney this week, Clinton backpedaled on her remark. Attempting to brush her “dumb” statement aside, Clinton explained that she merely “shorthanded” what she has said “for decades.” She stated,
“Our economy grows when businesses and entrepreneurs create good-paying jobs here in an America where workers and families are empowered to build from the bottom up and the middle out — not when we hand out tax breaks for corporations that outsource jobs or stash their profits overseas.”
What Clinton probably does not realize is that her amended statement reveals even more of her economic ignorance. The USA ranks close to the bottom in the industrialized world for tax competitiveness, according to the Tax Foundation’s latest global index. Coming in at number 32 (right behind Spain and Italy, of all the economic embarrassments), the USA has “the developed world’s highest corporate tax rate at over 39% including state levies, plus a rare demand that money earned overseas should be taxed as if it were earned domestically.” Only Portugal (31.5% tax rate) and France (34.4% tax rate) rank below the USA.
Ironically, countries often lauded by American liberals as bastions of their flawed ideology do not agree with Clinton’s aversion to tax breaks for corporations. Sweden (22% tax rate) ranks fourth in the developed world for its competitive tax code. Other countries which make the top fifteen include the Netherlands, Finland, Norway and Ireland—with a low 12.5% tax rate.
The reality of the USA’s faltering position in the developed world hasn’t prevented President Obama from continuing on his path—a path with which Clinton, apparently, agrees—toward punishing businesses for setting up shop in a country which offers tax burden relief. According to the Wall Street Journal, if Obama—and his Democrat supporters—succeeds in his plan to make it more difficult for companies to re-invest future profits in the USA tax-free, “the U.S. could fall to dead last on next year’s ranking.”
Contrary to Clinton’s revised but just as ignorant statement, a tax code reform which invites companies to stay or move to the USA would be the best possible solution to boosting economic growth and creating “good-paying jobs.” Research proves that high corporate taxes results in lower wages—that’s a reality Clinton just doesn’t understand.
