In a post, “Cantor’s Pro-Growth Call,” CNBC host Larry Kudlow points to an important speech from House Majority Leader Eric Cantor at Stanford’s Hoover Institution. Kudlow reports:
Cantor is afraid the Republican budget-cutting message is a little too austere, so he’s attempting to balance the necessary budget cuts with a pro-growth, tax-and-regulatory reform message.
Cantor focuses especially on getting business tax rates down to at least 25 percent. He also proposes a tax holiday to repatriate the foreign earnings of U.S. companies. So many CEOs have made the same argument. And this was done successfully in 2004-05. If enacted, maybe $1 trillion in cash will flow back home for new investment and jobs.
Along with a lower, more globally competitive corporate tax rate, the National Association of Manufacturers has long supported the “holiday” strategy to repatriate foreign earnings, which enjoys vigorous bipartisan support. From Politico, March 4, “Big Business to Congress: How about a tax holiday?”
The tax holiday is an idea that draws bipartisan support from tax-cutting Republicans and pro-business Democrats. And with unemployment stuck in the high-single digits and economic growth still frustratingly slow, the prospect of drawing hundreds of billions of dollars parked overseas back to the United States may become increasingly difficult for skeptics to resist.
“The states are getting ready to lay off thousands of people, the Middle East is burning, unemployment is stuck at 9 percent,” Jason Mahler, a lobbyist for Oracle and former chief of staff to Rep. Anna Eshoo (D-Calif.), told POLITICO. “What else are you going to do in terms of stimulus that’s of any consequence? The quiver is empty.”
The text and video of the Majority Leader’s speech at the Hoover Institution are here.
P.S. Kudlow spoke enthusiastically on his radio show last Saturday about manufacturing as a major force driving the economic recovery. Thanks, Larry!
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