By Representative Michele Bachmann
The United States has been a world leader in many of the best ways possible. Our devotion to freedom and our tireless ingenuity have kept America in the vanguard of the global community.
But unless we change our tax code, the U.S. is about to take the lead in a very unfortunate category. With Japan's Prime Minister Naoto Kan announcing that his nation will lower its corporate tax rate by 5% in 2011, the U.S. will have the unenviable distinction of holding the world's highest corporate tax rate. When state corporate taxes are added to the federal burden, our country's average corporate tax rate is almost 40%.
The Japanese prime minister told reporters, "By daring to go with a 5% reduction, we will spur companies to invest domestically, expand employment and raise wages. That will stimulate the domestic economy, support growth and shake off deflation."
The U.S. must remain competitive. As an industrialized nation and leader on the world stage, we must be out front in the race for jobs and a robust economy. It is time to sink or swim and, as a former federal tax attorney, I know that if we allow our businesses to face the highest existing corporate tax rate, we will certainly sink.
I recently introduced the End Tax Uncertainty Act of 2010 to effectively ease the tax burden on America's families, individuals and businesses. One of the key provisions in my bill would cut the federal corporate tax rate to 25%. I plan to put that reduction back on the agenda when the 112th Congress reconvenes in January.
The Center for Data Analysis predicts that lowering the corporate tax rate to 25% will increase the number of jobs annually by 581,000 on average from 2011 to 2020. Our GDP will rise by an average of $132 billion, and a typical family of four will see its after-tax annual income rise by almost $2,500.
I have heard from families across the Minnesota district that I serve who would greatly benefit from more job opportunities, not to mention an extra two grand in their pocket each year. In our battered economy, we need to see these positive benefits occur right away.
Minnesota is privileged to boast 21 Fortune 500 companies within its borders. It would be devastating if any of these companies relocated overseas. I hate to imagine the far-reaching and harmful effects that would have on communities. But the fact is that our corporate tax rate is putting an unnecessary burden on the nation's private sector, not to mention costs that are passed along to consumers.
I believe in the American Dream, but many Americans aren't so sure it still exists. The national unemployment rate is at a heartbreaking 9.8%. It has been at or above 9.4% for 19 consecutive months. That's why now is the time for our federal government to do more to give certainty to corporations.
By lowering the corporate tax rate, Congress can take an important step in restoring confidence for the job creators that make up our country's business community.
As a foster mom of 23, and biological mother of five, my strongest desire is to see America succeed for future generations. The era of bailouts, takeovers and failed "stimulus" spending must not continue into the future. Congress can put a stop to it immediately in January.
Then we can work to bring down our $13.8 trillion national debt, much of which is owned by China and Japan, and take on the enormous problem of unfunded liabilities. When you account for benefits promised by the United Sates government and adjust for inflation, those unfunded liabilities soar past $100 trillion.
The United States should not fall behind other nations. Instead, it is our time to lead. Let's focus on cutting taxes, growing our economy and leading in technology, education and industry. If we reverse course from the agenda Nancy Pelosi, Harry Reid and Barack Obama have put us on, then our nation can truly succeed well into the future.