Some of former President Bill Clinton’s big ideas for putting people back to work are a little dubious, but at least one of the ideas listed in Newsweek‘s latest cover story makes sense: cut the corporate tax rate.
It’s true that our corporate rates are the second-highest in the world. But it’s also true that what our corporations actually pay is nowhere near the second-highest percentage of their real income in the world. So I’d be perfectly fine with lowering the corporate tax rates, simplifying the tax code, and saving some money on accountants, but broadening the tax base so that all of them pay a reasonable amount of tax on their profits. That’s what the Bowles-Simpson commission recommended, and it’s the right policy. Lower the rates to be competitive, but reduce the loopholes that cause unfair disparities. We all need to contribute something to help meet our shared challenges and responsibilities, including solving the debt problem.