Yeah, we know, "Corporations are people, too." No, they're not. Verizon may be run by human beings (I know a bit about how that company is managed and one might question that), but to say that it is people is like saying that a huge earthmover or crane is simply the person at the controls. No. At some point, size takes over and the organization loses all but the most tenuous connection to the people it employs, its officers, directors and its stockholders; the connection is even more muted because of the differences among those groups. As one of my professors said, a long time ago, at some point a difference in degree becomes a difference in kind.
And don't bleat about how high our corporate taxes are and how they discourage American competitiveness. That's Eco 101, but in the real world things are a lot more complex. The fact is that the US is still by far the largest economy--and market--in the world. International corporations need to be here. Let them pay for the privilege. Make them pay more for the privilege. One of the first things we should do is to tighten rules that let companies use slick accounting to keep profits offshore.
One idea that I have had is to tax companies according to their size. Small, efficient companies would be taxed at a lower rate than large, inefficient ones. (And at the same rate as large, efficient ones, although efficiency tends to go down as size goes up.) The concept--I haven't got beyond concept--would be to give companies a choice: their tax rates would be set by their return on investment or their gross income, although the tax would be levied only on net income. Companies could change their election, but only after a period of years.
I'm not an economist, and can't calculate exactly how all this would all work out. If there ARE any economists out there, let TONE know and perhaps we can explore the idea.
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