Bloomberg News waddles in with its own version of the overseas profits repatriation story previously done by "60 Minutes" and the New York Times, and with a similar tilt.
The article quotes Edward D. Kleinbard, a law professor at the University of Southern California in Los Angeles: "Why should we reward firms for successfully gaming the tax system when we in turn are called on to make up the missing tax revenues?"
Professor Kleinbard works for USC, which as a non--profit educational institution, doesn't pay any federal income taxes. For him to be complaining about corporate tax rates is hypocrisy, and Bloomberg doesn't call him on it or even point it out. Nor does the article mention that it is the high U.S. corporate tax rates relative to other jurisdictions that are driving this sort of behavior by companies.
The Bloomberg article says that Cisco's CEO "has campaigned for a repatriation tax holiday, which the nonpartisan congressional Joint Committee on Taxation says would cost the U.S. Treasury $78.7 billion over the next decade. That's about how much the federal government will spend on cancer research over that time, based on current budgets." Notice how the article frames the issue: corporate tax breaks versus cancer research. Never mind the possibility that some Cisco shareholders would donate their profits to cancer research if there were lower taxes, or that they might reinvest their gains from Cisco into drug companies that might spend the money on cancer research.
The Bloomberg article does add to the "60 Minutes" and New York Times accounts by reporting that the idea of a tax "holiday" for repatriating overseas profits "gained momentum last week after Senator Charles Schumer, a New York Democrat, said his party's caucus was discussing whether short-term revenue from the holiday could fund an 'infrastructure bank' to create jobs. ...Cisco, Oracle Corp. (ORCL), Microsoft Corp. (MSFT) and others formed a coalition called WIN America Campaign that plans to spend several million dollars pushing the issue. The group is being advised by SKDKnickerbocker, a Washington-based political consulting firm for which Anita Dunn, President Obama's former communications director, is a managing director."
Bloomberg doesn't mention it, but SKDKnickerbocker managing partner and co-founder Josh Isay "managed Chuck Schumer's 1998 upset of Al D'Amato and served as Schumer's first Chief of Staff in the U.S. Senate."
The Bloomberg News article seems to come down to the left of Senator Schumer on the issue.
