My colleague, Conservative Wanderer, rightly chides the administration for their populist rhetoric regarding tax inversions after having helped Delphi to do the same in the Great Detroit Meltdown. Having done so, I can’t resist a reblog on the subject in general I made in commentary on another board after somebody pushed one of my buttons:
This talk of “inversion” is ridiculous, way out of line and more than a little frightening.
You know what Democrats are doing? They’re building an economic copy of the Berlin Wall. They’re desperate for tax revenue to float their entitlement state– it’s long been apparent this is not possible, but that doesn’t keep them from trying; or defending their sacred ground until they bleed on every square inch of it– so they are trying to force US-domiciled companies who are considering moving to remain in the US and pay their taxes here. It is of a piece with the ridiculous notion US domiciled companies ought to pay US taxes on income earned outside US jurisdiction, a distinction our beloved Congress shares with such forward-thinking nations as Albania and North Korea.
It’s interesting what the rise of globalization has wrought. Among many, many other things, this process has both rendered obsolescent and made ineffective the rigid, top-down regulatory control preferred by governments in the 20th century. This is because the globalization of capital has made country of domicile irrelevant, and the rise of communication tech has made it common knowledge there are better opportunities elsewhere. One can think of it as a tidal wave. Some governments have grabbed a surfboard and are trying to ride it, using influence to shape corporate behavior; that is by making it attractive for companies to domicile there. Other governments are building sea walls, trying to hold back the tides and keep their absolutist policies in place just a few breaths longer. Trying to hold back the tides by government fiat does not work in practice. That’s what King Canute was saying, and he died in AD 1035 so this is not a new lesson.
Wherefore I confidently predict, if Democrats and RINOs are successful in building their wall, they will learn the exact same two lessons the old Soviets learned with the original: First, that such a wall stands in mute testimony the system it guards is worth running away from. And second, while the wall might intimidate the slower-witted and less ambitious of the people it imprisons, the best and brightest will not be deterred. They’ll go over or under or around or through. Like the Soviets before them, the Congress can shoot the wall-breakers, or send them to the Gulag. What they can’t do is convince the people behind it sticking around voluntarily is a good idea.