It’s quite a thing when the head of a major U.S.-based multinational corporation identifies the People’s Republic of China — of all places — as having a friendlier attitude toward business than the United States, but that is exactly what has happened.
According to the Financial Times, Muhtar Kent, the chief executive of Coca-Cola, believes that it is easier to do business in China “in many respects” and that Brazil is also “an example of an emerging economy that is making itself attractive to investment in ways that the U.S. once did.”
“They’re learning very fast, these countries,” the FT quotes Kent as saying. “In the west, we’re forgetting what really worked 20 years ago. In China and other markets around the world, you see the kind of attention to detail about how business works and how business creates employment.”
In particular, Kent singled out U.S. tax policy for “creating uncertainty for business and hurting investment.”
“I believe the U.S. owes itself to create a 21st century tax policy for individuals as well as businesses,” Kent said.
The lack of a tax code friendly to the interests of businesses — which, after all, are the engines of economic growth and creators of jobs here in the United States — is a problem that has been under examination for some time by some of the nation’s brightest political minds.
Enter James Pinkerton, the former Reagan and Bush 41 White House aide and commentator who, with former Clinton White House aide Elaine Kamarck, is heading up a new coalition determined to bring sanity back to the corporate tax code and investment back into the United States.
Pinkerton is now co-chairman of the RATE Coalition — or the Reducing America’s Taxes Equitably Coalition — which, backed by a number of significant U.S.-based multinationals, is pushing for a major overhaul of the U.S. corporate tax code.
“The U.S. has the second-highest corporate income tax rate among the industrialized countries,” Pinkerton told PJMedia. “That’s not good for U.S. competitiveness, which means it’s not good for economic growth and jobs, jobs, jobs.”
Indeed the United States, which currently has an unemployment rate of more than 9 percent among those still looking for work, has seen more than 1.7 million jobs vanish just since President Barack Obama put his name to the original $800 billion stimulus package. Analysts suggest that, at a time when many corporations are posting near-record profits and the major U.S. banks have paid back with interest the bailout funds they received from the first TARP, job creation should be more robust. The reason it isn’t, they say, is that an environment of uncertainty hangs over the business community — an environment that has been created almost exclusively in Washington.
“In the last decade,” Pinkerton said, “30 of the 34 OECD countries have lowered their corporate income tax rate. This means, according to a study by Ernst & Young which can be found on the RATE Coalition’s web site, that the weighted average corporate tax rate for the OECD countries — excluding the United States — is almost 10 points lower than the U.S. rate.”