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Oct 23

Corporate Inversions: It is Time to Stop Blaming the Victim

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Corporate Inversions: It is Time to Stop Blaming the Victim

By Molly Roberts

Almost all romantic relationships start off the same. There is mystery and intrigue as young hearts long for each other and worry if their advances will be returned by the other. Some relationships develop into mutually beneficial relationships where both partners benefit from the other, but this is not true of all relationships. In far too many relationships, things take a turn for the worse, and what was once beautiful becomes terrifyingly bleak.

One never plans at the outset of a relationship to harm the other, and the other never envisions being in an abusive relationship, but far too often couples find themselves passing through the cycles of domestic violence. After the courting phase, stress starts to mount. Often little things, in and outside of the relationship, start to wear on one or both of the individuals. These small and large pressures continue to grow; until one day, they boil over like a pot of water that has been boiling on the stove for too long. At this point, the one partner is overcome and lashes out at their significant other with vicious words and often sadistic deeds. After such an outburst, the abuser realizes they have gone too far and attempts to make amends. They try to win the affection of their partner back by promising things will be different and showering them with gifts to win back their affection. After they are back in the good graces of their significant other, things are fine; at least, until the stress starts to mount again.

This cycle is not limited to romantic relationships, it occurs in relationships of all sorts. Presently, this cycle of abuse is occurring between many corporations and the U.S. Government. Businesses in the United States have the highest tax rate among developed countries in the Organization for Economic Cooperation and Development (OECD) at 35%. The government takes a third of each business’ income. Keep in mind, the government is not snatching up their profits; they are seizing a third of all of their sales. Whether a company is doing well or failing, the government will take its pound of flesh.

Besides being financially abused in the United States, corporations are also verbally abused. If you listen to many politicians, they will blame everything that is wrong with the world on corporations: people are starving, because corporations do not pay employees enough; global warming is the result of evil corporate pollution; and children are not being raised properly, because corporations want their employees to work too many hours. The litany of complaints never ceases.

After so much abuse, many wonder why corporations stay in the United States. Many stay because when they try to leave, the Federal Government apologizes and claims they did not mean to do all those horrible things. Politicians promise to make it up to their favorite companies by providing them with subsidies and tax breaks. All of these tokens of affection will entice the corporation into staying, but it will only be a short time before politicians lash out with more abuse when their poll numbers drop.

Many corporations have decided to end the cycle of abuse and move out of the country through the process of corporate inversions. In a corporate inversion, a U.S. corporation merges with a country that is headquartered in another country. After the merger, the U.S. Corporation moves their headquarters to the other country. For example, Burger King recently announced that they would be inverting with Tim Horton’s, a Canadian donuts and coffee chain. After moving their corporate headquarters to Canada, Burger King’s tax rate will go from 35% in the United States to 26% in Canada.

The U.S. Government has not taken kindly to this rebuke. Like a spurned, jealous lover, the U.S. Government has lashed out against all corporations who are leaving them for another by making it financially costly to conduct corporate inversions. Politicians and pundits have called these corporations unpatriotic and unfaithful to their home country, but such tactics are equivalent to blaming a victim of domestic violence for leaving. When a person or a company is being abused, they should be allowed to leave an abusive relationship.

The U.S. should end their reign of terror by lowering their corporate tax rate to below the OECD average of 25%. Also, they should not punish victims of their abuse by hindering corporations that wish to leave. The U.S. Government needs to learn that it is wrong to hurt others.

 

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