Obama: Give tax breaks for US jobs
The president plans to propose tax incentives to reward companies that create US jobs. He wants to end tax breaks for companies that send jobs overseas.
This post is by Roger Runningen of Bloomberg.
President Barack Obama says he will propose new tax incentives to reward companies that invest in U.S. expansion or bring back jobs from overseas and elimination of tax breaks to companies that move jobs outside the country.
At a White House forum this week with representatives from more than a dozen companies, including Ford and Intel, Obama said more must be done to encourage business investment and job creation.
The tax initiatives will be part of the fiscal 2013 budget plan that is set to be sent to Congress the first week of February. The White House didn't release details. Obama also plans to propose adding $12 million for a program to promote foreign direct investment in the United States and work with state and local governments to attract businesses.
The companies at the event are among those that have decided to return jobs from overseas or increase their U.S. operations. (Post continues below video.)
"We are in a unique moment, an inflection point, a period where we’ve got the opportunity for those jobs to come back," Obama said in his remarks to the group at the White House. "The business leaders in this room, they’re ahead of the curve. They recognize it."
Economic growth and job creation are expected to be the main issues in the presidential campaign this year. Mitt Romney, the front-runner for the Republican nomination, is making criticism of Obama's stewardship of the economy a prime focus of his stump speeches.
The unemployment rate has declined for four straight months to 8.5% in December, and the Labor Department has reported six consecutive months of jobs gains of 100,000 or more. Still, the rate has been above 8% for almost two years, and little headway has been made in recovering the 8.75 million jobs lost as a result of the recession that ended in June 2009.
According to the administration, manufacturing production has risen at its fastest pace in a decade, with 334,000 manufacturing jobs created over the last two years and manufacturing production having risen by 5.7% on an annualized basis since reaching a low in the summer of 2009.
Obama said the United States is becoming more competitive for businesses because of productivity gains and rising costs for doing business in other countries.
"I don't want America to be a nation that's primarily known for financial speculation and racking up debt buying stuff from other nations," Obama said. "I want us to be known for making and selling products all over the world stamped with three proud words: 'made in America.'"
With wages in China rising between 15% and 20% a year, "the economics are favoring the U.S." for moving jobs back, Hal Sirkin, an outsourcing expert and senior partner at Boston Consulting Group, told reporters after Obama spoke.
Ford plans to add 12,000 jobs in the United States by 2015 and has brought additional production back to the United States from China, Japan and Mexico, according to the administration. The statement highlighted Intel’s participation in a $4.4 billion investment to build a semiconductor research and development facility in New York.
Along with Ford and Intel, companies taking part in the forum included DuPont, the largest U.S. chemicals company by market value; Otis Elevator; and the North American unit of London-based Rolls-Royce.
One of the business leaders at the White House for a roundtable discussion with administration officials was Angela Selden, co-chairman of Arise Virtual Solutions near Fort Lauderdale, which recruits workers for call centers.
Selden said in a telephone interview that she will urge the administration to appoint a special White House adviser to focus on bringing more virtual or Web-based jobs back to the United States.
There already has been a surge in U.S.-based new call centers as companies move them from India, the Philippines or Jamaica, according to Selden. U.S. workers’ familiarity with American culture results in greater customer satisfaction and cuts the number of calls needed to resolve issues.
"If I’m trying to get service for a snow blower, odds are very high" someone in India has never seen a snow blower, Selden said.
Arise, which expects $200 million in global revenue this year compared with $150 million last year, recruits workers to act as representatives of American companies from their own homes. Its clients include cruise line Carnival, Walgreen, Time magazine and the American Automobile Association.
About 22,000 of its agents are located throughout the United States, and Arise is hiring as many as 10,000 people this year in the United States, Canada and the United Kingdom, Selden said.
More from Bloomberg and MSN Money:
- Economists scoff at Obama, Romney job-creation myths: Ezra Klein
- Obama said to reprise deficit, tax proposals for 2013 budget
- Buffett to GOP: I'll match your cash
- Romney would hike taxes on poor 60%
- Santorum's tax plan leaves hole in budget
They don't have to choose one. By its very nature of being proposed by a Democrat president, they will be against it no matter what, good or bad for this country. The party of "anyone but Obama" CONS have made it clear.
Funny thing, if BUSH had done this, then they would be jumping for joy all over it. But, then the DumboCrats would be completely against it.
Our Representatives have broken the system and it may well be beyond repair.
In fairness, half the problem is the reasons for not hiring keep changing. One of the top stories on MSN today is that companies want to hire but hiring isn't happening because of a lack of qualified applicants. It runs contradictory to the idea that companies are strapped for cash due to taxes, or too afraid of the future to move forward due to fear of regulations. Tomorrow it'll be a lack of demand for goods, or instability in Europe, or Iran sneezing or something new.
Even if we assume any or all of those reasons aren't pure bovine droppings, it's hard to address an issue when you aren't sure what issue needs to be addressed, especially when there isn't a blanket solution (lowering corporate taxes won't stabilize the middle east or bring qualified employees to your door). Sadly, that would require businesses to be completely honest as to their actions instead of using the unemployment rate to push for things they want but may not be related to hiring practices.
GOP will fight it for some reason or another. Obama did offer tax breaks before in the negotiations and they ignored everything he proposed. Said he did not put anything in writing.
Give me a break!
I own a small biz and would never hire someone based on the tax policy du jour; hiring is a long term decision for me and layoffs have never happened at my company.
We hire because we have profitable work that needs to be done.
Why not tariff a class of imports (i.e. electronics) to reverse/eliminate the job export savings and then use those tariff revenues to fund rebates to consumers who buy those products? The consumer will then make the rational choice to buy the lower cost American made product and the jobs will insource themselves. Am I missing something here?
Under the circumstances and obstructionist........This President continues to be the best President in modern history. No body in the clown car could or would even compare. The election is over. Obama wins again. Now all you overseas usa corporations. Do what is right, be an example and bring your corporations home and get to work. Pay your employees a fair wage with benefits, keep reinvesting in America, quit paying the ceo millions and billions, and tell your shareholders to not be so greedy. Good Luck and BUY AMERICAN AMERICA.
What, you mean target rewards at those that actually do what you want them to do instead of just assuming it will happen? How groundbreaking.
Too bad the republicans will probably try to squash it on the grounds of incrased beaurcracy over blind freedom to screw up.
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