You're watching...
First Trust Advisors chief economist Brian Wesbury weighs in on the debate over corporate tax rates.
Also in this playlist...
Auto-advance: ON
Auto-advance
This transcript is automatically generated
-- Brian Wesbury is the chief economist at first trust advisors who joins us now can weigh in on all of this is the New York Times is going after apple for no reason or do you think there's something more -- -- Brian.
-- out -- I mean this is just there's an endless debate I mean I've been an economist for thirty years.
We've been talking about this for thirty years and we know how to fix this.
The US has the highest corporate tax rate in the world.
It it companies like apple do business they're very innovative with the products they're very global in nature so they're gonna be innovative and -- their tax strategy too they're gonna pay taxes where they earn that money.
-- Other companies have a lot lower tax rates the way you get.
US corporations to pay more taxes in the US is to lower the US corporate tax rate.
And that will allow these companies to claim their income in the United States and not somewhere else because there's a.
-- tax rate important to point out when you look at this story.
And -- -- hundred a couple of stories about America corporation's here recently the one about Wal-Mart that got a lot of attention was basically accusing Wal-Mart have committed a crime bribing people and in Mexico you know this one doesn't accuse apple of committing any crime in fact -- points out just about every paragraph that what they're doing is legal.
So -- so it does as you point out bring up a larger.
Part of the conversation in tax.
Reform is the government is it is the government losing out.
New gasket that went a lot of yes it would ordinarily would have and it did things in a more simple fashion.
Absolutely you know last week there was.
A Wall Street Journal op Ed written by Peter diamond and -- -- as they said.
That we ought to raise the top individual income tax rate to fifty or maybe even 70%.
But this same thing would happen if we did that on individuals.
Corporations are not in business to pay taxes.
They're in business to produce goods and services that consumers want.
And to increase the value of their company for their shareholders and so they're gonna do that in any way they -- if you if we raise tax rates on companies that which we have already done.
Or individuals they will move.
They are able I find other ways did do put in -- lower tax jurisdictions it's it's really simple.
We've done that -- there's Apple Stock today by the way down twelve -- we've done that story -- have for example the state of Illinois.
Jeff Flock out of our porters are not there in this at all these companies were leaving.
The state movie probably water and try to get a lower the tax system.
You know somewhere else like this idea that had taken you know we just talked about what was McDonald who better spends the money and that's.
At the end of -- in terms of economic growth going to be the big question too right if you even with the company's do they -- the better does that better off for the economy.
Obviously you had to -- -- in this case with two names apple.
-- -- -- -- -- From the all right take your -- which.
-- we got a little better investment yeah it's it's really simple actually government.
Never does as well as the private sector I'm not saying.
They know the government has certain things that it should do like defended the nation -- a fight wars.
I could even go maybe build highways but.
But but but the bottom line is is most things the private sector does better here's here's a good question for if you were I gonna try to find gold.
Would you send out the first airborne division and have them march around in in columns and dig holes all in one spot.
Or would you send out fifty grimy stinky.
Drunken miners into the mountains of California.
I guarantee you the miners are gonna find more gold -- -- first mountain division are.
And and that's what you want you who -- you don't like it its -- right he and they're they're not doing what you want to that are not organized but they get horrific.
