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NOV. 9,
2011 -- As you enter the sally-port of Padgett-Thomas Barracks at The
Citadel, one sees a plaque: "DUTY IS THE SUBLIMEST WORD IN THE ENGLISH
LANGUAGE" - Robert E. Lee. The duty of Corporate America is to make
a profit. The duty of the President and Congress is to develop a strong
economy for the nation.
I've never
met a stockholder that didn't want his or her corporation to make more
profit. I've never met a stockholder that complained that his or her corporation
off-shored to China. Corporate America will play the economy any way a
free or communist nation fashions it. Our task is to fashion an economy
strong enough to defend in globalization -- limit the off-shoring but
not stop it. The President
and Congress can't create a strong economy with federal aid. It needs
private investment, and this won't happen until Washington protects Corporate
America's investment. The best thing about China is that it protects Corporate
America's investment. China gives certainty. Fussing about the rich and
regulations in Washington creates uncertainty. Borrowing a trillion dollars
a year to keep the doors open tells Corporate America that its taxes will
increase. Corporate America sits on $2 trillion waiting for the President
and Congress to determine the increase. Wall Street, the big banks, and Corporate America keep shouting "Free Trade," "Protectionism," to keep the China profits flowing from China's protected, closed market. The Wall Street crowd is the biggest contributor to the President and Congress; so the President refuses to enforce our trade laws, and Congress refuses to make our tax laws competitive. Former President Clinton on Morning Joe (11/8/11) was just commenting how Germany did better than the United States on exports. True. Germany, with its 19% VAT rebated, exports to the United States tax free. The U.S. doesn't have a VAT, so its exports are levied a 19% VAT when they reach Germany. 141 countries with a VAT export tax free. The United States exports to 141 countries with its exports facing a VAT averaging 15%. Congress
can make the United States competitive in globalization by taking the
tax benefit to off-shore jobs and give it to Corporate America to on-shore
jobs - replace the corporate tax with a 6% VAT. This tax cut gives instant
tax reform, provides billions to pay down the debt, and millions of jobs.
Instead
of giving Detroit a bailout, President Obama should have imposed a tariff
on motor vehicles like Brazil. Instead of begging Russia for helicopters
for Afghanistan, President Obama should enforce the Defense Production
Act of 1950 like President Kennedy did for textiles in 1961. Instead of
suffering damaging deficits in the balance of trade, President Obama should
enforce our trade laws like President Nixon did in 1971 by imposing a
10% surcharge on imports. Instead of letting the economy go to pot, President
Obama should enforce our trade laws like President Reagan did in 1984
to protect steel, motor vehicles, computers, and machine tools. The financial
elite want the President and Congress to do nothing to slow the off-shoring
of production and jobs. So the President and Congress do nothing. They
continue to subsidize the off-shoring or getting rid of jobs as they say
their intent is to create jobs. They refuse to do their duty to develop
a strong economy. Instead of paying for government, they keep kicking
the can down the road. The Congress hasn't passed a budget in two years.
All plans to pay for government are never this year, but for a later Congress
to pay. Whatever the Super Committee agrees to or whatever spending cuts
are triggered won't take place until 2013, which a later Congress can
change or repeal. There is no pressure on the Super Committee. It's all
theater - the biggest fraud ever. We can't keep doing this for another
year. Senator Hollings of South Carolina served 38 years in the United States Senate, and for many years was Chairman of the Commerce, Space, Science & Transportation Committee. He is the author of Making Government Work (University of South Carolina Press, 2008). © 2011, Ernest F. Hollings. All rights reserved. Contact us for republication permission. |
About Fritz Hollings Ernest F. Hollings served the public for 56 years -- 38 years in the United States Senate and as South Carolina's governor, lieutenant governor and a member of the S.C. House of Representatives. Today, Hollings continues to be influential in public affairs and offers this Web site as a compendium of current and past positions on public issues. Learn more about Fritz Hollings. Receive commentary via The Huffington Post Please visit Sen. Hollings' section of The Huffington Post where you can get an RSS of his columns, subscribe by email or use social media. The Hollings legacy Click here to learn more about Hollings' impressive and distinguished record of public service.
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University of South Carolina Press in 2008 published