America keeps the taxes on corporations very low – in 2009, U.S. corporate taxes were saved from being in the basement only by Iceland. The argument from Republicans is that rates have to stay low in order for businesses to hire people.
But as Rachel talked about on the show last night, the same corporations that have been getting tax breaks have been laying off workers, not hiring. Citigroup, for example, paid just at 16.9 percent on its supposed rate of 35 percent last year, and sent 5,000 employees home. Meanwhile, we have towns and states cutting the school week because they’re broke.
House Majority Leader Eric Cantor (R-Virginia) now says he’s willing to talk about closing loopholes for tax breaks like the ones on corporate jets. Mr. Cantor adds this: “But, listen, we are not for any proposal that increases taxes. Any type of discussion should be coupled with offsetting tax cuts somewhere else.” What he’s saying, I think, is that the government cannot take in more money. It’s fine to get rid of the embarrassing loopholes like the one he defended for corporate jets, but the government cannot take in more money overall.
Never mind that Republicans themselves proposed just in March that the government cut spending and take in more money. That’s what you do if you’re a Republican trying to fix the budget and save the economy – 85 percent spending cuts to close most of the deficit, and 15 percent new revenue to finish the deal. But if you’re a Republican trying to put your stamp on the way government works, then you starve the coffers and feed the base. No new taxes. The schoolkids will just have to deal with it. (Adding: And maybe the oldsters, too.)