Last Updated on June 8, 2016 by cassnetwork
The following guest column was submitted by U.S. Senator Joe Donnelly.
I have always believed that our country works best when the middle class is strong—it’s good for families, businesses, and our local communities. For decades, the strength of the middle class has been rooted in a social contract between businesses and workers—a mutual understanding that the success of one contributes to the success of the other.
Yet, in Indiana and across the country, we have seen a troubling, decades-long trend of a shrinking middle class, due in part to a decline in manufacturing.
There is perhaps no better example of the threat to America’s core than United Technologies Corporation’s recent announcement that it intends to move 2,100 Hoosier jobs to Mexico to chase $3-an-hour wages in Mexico. This type of corporate decision-making by a highly profitable company, not only eliminates good-paying Hoosier jobs, but it fuels an economic anxiety that persists throughout our communities and our country.
It should be no surprise that this anxiety often turns to frustration, particularly when our federal policies do little to discourage this type of behavior. Today, corporations like United Technologies use the U.S. tax code and federal contracts to build their companies stronger, with no penalty for shipping jobs overseas. In fact, under current tax law, corporations like United Technologies can even write off their moving expenses for shipping jobs overseas.
Just as corporations feel an obligation to shareholders, as a U.S. Senator, I have a responsibility to working families, taxpayers, and the American economy. That is why I recently proposed a series of policies that would penalize companies that ship jobs overseas and encourage investment in the U.S.
First, if a corporation decides to fire American workers and send those jobs overseas, that company should not be able to write off the moving costs. It is fundamentally unfair that when companies leave for a foreign country they get subsidized by American taxpayers on their way out the door.
Second, when corporations send American jobs overseas, federal policy should require that recent grants and tax breaks received by these companies be returned to taxpayers. Moving forward, tax breaks should be awarded to companies investing here in America.
Third, when the federal government makes contracting decisions about which goods and services to purchase with American tax dollars, it should consider whether bidding corporations have pursued cheaper foreign labor at the expense of American workers.
Lastly, we should encourage job growth in rural and low-income communities. Companies that bring jobs to these communities from foreign countries should receive tax incentives that help spur economic investments and growth.
There is no single solution to prevent corporations from moving jobs to low-wage countries, but hardworking taxpayers deserve to know that our policies are working to promote the American economy, invest in our workers, and strengthen the middle class. That’s just Hoosier common sense.
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