Workers have choices, too, though some have more choices than others. But if you think that paying the CEO a lot drives down workers’ wages, wouldn’t you also think that other expenses would put downward pressure on wages, too? And which would produce the heavier pressure: $376 million for the CEO or $8.3 billion for the IRS?
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Hillary Rodham Clinton, embracing the Left’s current fervor for Hugo Chávez–style economic populism and nationalism (weirdly, “the Left” includes the Republican presidential nominee, for purposes of this discussion — bang-up job, Republicans!), complains about inequality, and offers as a partial solution higher corporate taxes. Businesses respond to changes in their expenses in different ways. But who do you think is likely to take it in the shorts if you jack up Apple’s tax bill? The designers and programmers who are being offered new six-figure jobs eight times a week at companies all over the country and all over the world, or the parking-garage attendant?
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Sometimes businesses go so far as to relocate their headquarters in response to taxes and other burdens; one way of doing that is the dreaded “corporate inversion,” in which a U.S. company uses a merger to relocate its legal domicile to some sweaty, exploitive, relatively low-tax Third World crap-hole . . . like Canada, the United Kingdom, or Ireland. Mrs. Clinton proposes to put a stop to that by enacting an “exit tax,” which is a really nice way of saying “ransom.” That might cause some trouble for existing businesses considering relocation, but what effect might it have ten or 20 years down the road? Do we really think the people who are smart, creative, and energetic enough to build the powerhouse corporations of tomorrow are going to be too stupid to figure out how to incorporate in Switzerland instead of Delaware?
Ozymandias and Statolatry