Corporate tax turncoats growing

Tim Dickinson, Rolling Stone -   Companies striking deals to become technically foreign can be found in all corners of American business, from California computer-equipment manufacturer Applied Materials to Minnesota medical-device giant Medtronic to North Carolina ­based banana behemoth Chiquita. Little is changing in the core business of these firms. They will just pay less in taxes – and to a foreign government, often Ireland or the Netherlands.

... Over the next decade, corporate inversions could cost the U.S. Treasury nearly $20 billion – revenues that could other­wise pay for Head Start programs, to rebuild roads and bridges, or just bring down the deficit. The wave of inversions is threatening "to hollow out the U.S. corporate income tax base," [Treasury Secretary] Lew warned in a July letter to the chief tax writers in the House and Senate. But inversions are just the tip of the iceberg. The crisis of corporate tax avoidance is far more pervasive – and destructive – than either Obama or Lew is letting on.

.... In public, Democratic politicians blast corporate tax dodgers. But the party's most viable comprehensive "reform" proposals would reward the crooked accounting of U.S.-based multinationals. Republican­ backed legislation – no surprise – would only make the crisis worse. Why? "It's not rocket science; it's money and politics," says Jared Bernstein, former top economic adviser to Vice President Joe Biden. "Concentrated wealth is buying the policy agenda it likes, and blocking one it doesn't."