Bill Clinton the Corporate Front Man Makes the Rounds in the Business Press
Bill Clinton often tailors his message to his audience. At Netroots Nation, he tells the crowd that they are the greatest force for social change in a generation. Behind a curtain with Paul Ryan, he pines for a grand bargain on the deficit. And if he’s being interviewed for business networks like CNBC and Bloomberg, here’s what he has to say:
• The BofA settlement will lead to a bunch of principal reductions, because the new sub-servicers mandated in the deal are more homeowner-friendly. This flies in the face of both logic and experience.
• Dodd-Frank implementation should be slowed down:
As the one-year anniversary of the financial overhaul draws near, Clinton was generally positive on the law as a whole, but suggested regulators should parcel out the new rules bit by bit for the benefit of businesses.
“One way to clear that up may be to stagger [the regulations] in over a more pronounced time table,” he said on CNBC. “I think there’s only so much change that institutions can handle at one time.”
The irony of the juxtaposition of Clinton pining for a slower timetable and the fact that we’re almost at the ONE-YEAR ANNIVERSARY of the signing of the bill is not lost on me.
• The US should offer another repatriation tax holiday, an amnesty for corporate profits.
“I favor it under certain circumstances,” Clinton said in an interview with Bloomberg Television’s Al Hunt yesterday in Chicago. He suggested an approach that would give companies a 20 percent tax rate on repatriated profits, which could be reduced to 10 percent if they “reinvest it in increasing employment in America.”
Now, the last time there was a repatriation tax holiday, under the Bush Administration, there was no residual investment in jobs. The idea that, as Chuck Schumer has been promoting, you can combine the repatriation tax holiday and use whatever revenue from it to fund an infrastructure bank is similarly a bad idea:
I like the infrastructure bank idea—it’s a cool way to make smarter investment decisions. But here’s why this is the wrong way to go about funding it.
There is no “money that comes back from abroad.” The Treasury collects some money up front and then starts losing big time. Why? … Because if companies with “overseas earnings” (these quotes are important, as I’ll explain next) learn that they can depend on a big tax break every few years, they’ll shift more and more earnings and jobs and investments abroad. To amplify this incentive has to be one of the craziest things we could do in an economy that desperately needs those earnings, jobs, and investments here at home.
Here’s a new kicker I learned from my CBPP colleague Brian Highsmith today, based on some excellent reporting here. Much of these “overseas earnings” actually start here—they’re shifted abroad to take advantage of lower tax rates and to defer them in hopes of…you guessed it!…another fun repatriation holiday.
You’re just incentivizing tax avoidance, basically.
So there’s your “Bill Clinton the corporate front man” persona. It’s a far cry from Bill Clinton in the middle of North Carolina telling farmers how the rich are stealing from them, or Bill Clinton the visionary on renewable energy talking up the transformative power of change, or Bill Clinton in a black church displaying remarkable empathy. If you want to know which one you’re going to get, look at the audience.