Economy & Business

A 15 Percent Corporate Tax Is Worth the Fight

President Trump arrives at the Loren Cook Company in Springfield, Mo., to speak on tax reform, August 30, 2017. (Reuters photo: Kevin Lamarque)
It could unleash a 1980s-style economic boom.

Three cheers for the Fight for 15! No, not the Left’s demand for a $15-per-hour minimum wage. (Why stop there? Why not $100 per hour?) That idea is a surefire job killer and exactly the wrong prescription from the same folks obsessed with an imminent invasion of robots.

The worthy Fight for 15 would slash U.S. corporate taxes from 35 percent to 15. Donald J. Trump ran on this bold, Reaganesque idea. To his credit, he is pushing it as president.

“We must restore our competitive edge, which we’ve lost,” Trump said Tuesday at the White House. “We can’t be the jobs magnet of the world if we continue to tax our industries at rates 60 percent higher than companies in other countries.” In North Dakota on Wednesday, he said: “Our tax code is giant, self-inflicted economic wound.”

For sky-high corporate levies in the First World, we’re No. 1!

“The United States has the highest corporate income tax rate among the 35 industrialized nations of the Organisation for Economic Co-operation and Development,” Kyle Pomerlau and Emily Potosky observed last month in an indispensable Tax Foundation paper. The United Arab Emirates is the only country with a higher corporate rate — a mind-blowing 55 percent. “In 2003, the worldwide average was approximately 30 percent,” Pomerlau and Potosky added. “By 2016, the average rate had declined by roughly 7 percentage points to 22.5 percent.”

“As the rest of the world’s economies mature, and their tax rates on corporate income continue to decline,” Pomerlau and Potosky concluded, “the United States risks losing its competitive edge, due to its exceptionally high corporate income tax rate.”

America’s 35 percent corporate rate equals those of tiny Malta, lovely but economically bipolar Argentina, and these African garden spots: Chad, the Democratic Republic of Congo, Equatorial Guinea, Guinea, and Zambia.

A 15 percent corporate rate would make America more attractive than every other OECD nation but Ireland. Its 12.5 percent corporate tax has transformed that former basket case into Europe’s Silicon Valley and a powerful argument for supply-side defibrillation.

Such robust business-tax reduction — coupled with personal-income-tax cuts, tax simplification, and repatriation of U.S. corporate profits stranded overseas — should unleash a 1980s-style economic boom.

“If we achieve sustained 3 percent growth,” Trump predicted, “that means 12 million new jobs and $10 trillion of new economic activity over the next decade.”

Such numbers would be impressive. But, more important, they would generate job offers for the unemployed, promotions for today’s workers, and green lights for new-business proposals, rather than the “It’s on hold” messages that have foiled entrepreneurs throughout the forgettable Bush-Obama years.

Restored prosperity also could pacify a society on the verge of self-strangulation. When Americans can pay their bills and care for themselves and their loved ones, they spend much less time pointing fingers at “the blacks,” “the Jews,” “the Mexicans,” “whitey,” or even Robert E. Lee.

As Trump pumps up the volume on tax reform, he and his allies should promote a 15 percent corporate rate, not “15 to 20 percent.” That soon becomes “20 to 25 percent.”

As if he were auditioning for a spot in this op-ed piece, House speaker Paul Ryan (R., Wis.) yesterday morning illustrated precisely how not to handle this matter. “Our goal is to get in the mid-to-low 20s, and we think that that’s an achievable goal,” Ryan said. Senator Orrin Hatch (R., Utah), for whom I interned in college, recently told Reuters: “In fact, it would be kind of miraculous if we could get it down to 25 percent or less.” Before long, Trump will have to beg Democrats and senators Susan Collins and Lisa Murkowski (but I repeat myself) for permission to nick today’s 35 percent rate down to 30.

Every American should join Trump’s Fight for 15 and embrace his tax-cutting vision.

Perhaps, at 4:30 a.m. in a congressional conference committee, Republicans might prevent final legislation from collapsing by agreeing with Democrats to shift from 15 percent to 17.5. But that concession should occur, if at all, at the last possible second, not before the bill even has been drafted. This is Negotiation 101 — a class that most Washington Republicans either flunked or never took.

Every American should join Trump’s Fight for 15 and embrace his tax-cutting vision.

“We cannot restore our wealth if we continue to put our businesses at such a tremendous disadvantage,” President Trump told a crowd in Springfield, Mo., last week. “We must reduce the tax rate on American businesses so they keep jobs in America, create jobs in America, and compete for workers right here in America — the America we love.”

Deroy Murdock — Deroy Murdock is a Manhattan-based Fox News contributor and a contributing editor of National Review Online.

Most Popular

Culture

Courage: The Greatest of Virtues

EDITOR’S NOTE: The following is Jonah Goldberg’s weekly “news”letter, the G-File. Subscribe here to get the G-File delivered to your inbox on Fridays. Dear Reader (Or Listener), As the reporter assigned the job of writing the article about all of Sidney Blumenthal’s friends and supporters told his ... Read More
Immigration

My American Dream

This morning, at 8 a.m., I did something I’ve wanted to do for as long as I can remember: I became an American. I first applied for a visa in early 2011, and since then I have slowly worked my way through the system — first as a visa-holder, then as a permanent resident (green card), and, finally, as a ... Read More
U.S.

The Gun-Control Debate Could Break America

Last night, the nation witnessed what looked a lot like an extended version of the famous “two minutes hate” from George Orwell’s novel 1984. During a CNN town hall on gun control, a furious crowd of Americans jeered at two conservatives, Marco Rubio and Dana Loesch, who stood in defense of the Second ... Read More