(Tim Fernholz – Quartz)
The GOP’s new tax overhaul may appear to be a victory for Donald Trump’s nationalist politics—but it’s not. In reality, the bill endorses globalization and backs business trends that shift jobs from the US to the rest of the world.
Almost a year ago, Trump threatened corporations that moved jobs abroad with punitive tax rates. As president, he will sign off on a switch from coercion to seduction, offering the same companies far lower rates in the hopes that will be a more effective inducement for job creation.
Although it’s been marketed as a middle-class tax cut, the largest line item in the new law is a $1.3-trillion reduction in corporate income taxes at a time of record profits. The US corporate tax rate is being cut by 40%, and rather than taxing global earnings, the US will move to a territorial system, with foreign revenue taxed at a bare minimum. Click here to read more.