Ashish, easier said than done. If you follow the "raise the US debt ceiling" discussion then you will notice that such a commonsense thing is part of huge politics. Job creation and retention go hand in hand with the tax incentives. If there are no tax incentives and the labor cost is high then why would a company would want to invest in that country. The problem starts only when we start to become emotionally attacted, which also make sense as we do not judge everything from logic. Last, this step by Immelt is hypocritical to the least.
"the answer is eliminate corporate taxes......the politics are the blocking agents."
Politics are the necessary evil, because it is through politics that collective (and constructive) decisions are made - including decisions about taxes and economy growth strategy. My question to you is if corporate taxes are eliminated, how will the government agencies and departments programs be funded? The solution is between lowering corporate taxes and reducing government's spending. I don't think that only personal income and consumption taxes are enough for the government to get sufficient money to finance its activities.
the answer is eliminate corporate taxes...they'll be no need for businesses to kiss the ass of any politician. As well, with automation today, labor is a significantly lower portion of the cost of manufacturing and quite often being co-located to where you sell a product is presents a much lower overall cost for a company. The USA still buys nearly 25% of everything made on earth. As an example of this, a fab in China such as SMIC employed about 3000 employees for the same number of wafers out as TIs Richardson fab where there are only 1000. Foreign companies are dying to be here and have "made in USA" on their products. You can see this in the fact that some of the solar comapanies are setting up module mfg in the USA, shipping wafers only to the USA and making panels here.
The solutions are relatively easy.....the politics are the blocking agents.
I have the same reaction as you Diane even though I know a company is beholden to its shareholders and not its country. Businesses take advantage of US tax law loopholes on one hand and outsource jobs to foegin countries on the other. That Immelt holds an important position in government makes this more insulting. This is a debate that should continue, although I'm not sure what the answer is.
Anyone who believes that a company should do anything except make money and compete in the market is misguided and Imelt by moving his health care group to China is planning on doing just that. As well, if you believe Imelt was picked randomly by Obama you are naive on that also. The unholy alliances Obama has created are just for extending his socialist policies and income redistribution. Imelt sees it as a way to gain favor and keep Obama off his personal back. He doesn't give a damn about any other company in the USA unless it supports IBMs agenda. And paying no taxes when you have massive loss write offs from GE Capital is the same tax wriet off anyone else could have used. Its in the tax code.
The best way to make the USA more competitive in any way and the education of our population to be more focused on STEM is to get the government out. Eliminate corporate taxes and go to a consumption tax and we won't be pointing our fingers at the supposed nasty companies paying not enough taxes and move to privatize the public school system. The schools suck and have gotten worse every year wherein the teachers and management are only interested in the adults jobs and pay and retirement. Not the kids. As evidenced by the 1995 dumbing down of SAT tests instead of improving kids skills.....its so broken it needs scrapping!
You want high tech and jobs here....eliminate corporate taxes.....Obummer is too dumb of an ideologue to do anything but push socialism.
The problem is with the entire US Tax structure.It is filled with so many Tax-breaks that corporations like GE can drive a Truck through them.
The entire Tax structure needs to be overhauled and overhauled dramatically.
The best option is to rip the whole book apart and start from scratch with No exceptions or breaks for anybody except the SMBs (firms which employ less than 500 employees).These firms are the major Employment Generators in the US (not the Corporations) and can do with all the support we give them.
This move by GE Med does seem more than a little hypocritical on the part of Mr. Immelt. I haven't been a fan for a long time, and this combined with the favorable tax status ins't helping.
The thing is this is not really just an issue for America. It is more glaring today because of the economic circumstance of the U.S., but the reality is this is something that affects all nations. Sooner or later "emerging" economies like China are going to reach a point where their biggest corporations will start transferring jobs en masse to other countries. I doubt the Chinese people will be any happier about it than we in the U.S are today.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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