Headline May 21, 2017/ ''' MADE IN AMERICA MODE '''

''' MADE IN AMERICA MODE '''

ARE AMERICAN MADE products at a disadvantage to imported ones? That's the argument supporters of  20 percent hike  on imports are making to justify their position.

Proponents of the increase claim that  American made  goods are tipped at a higher rate than goods that are imported into the country. They are calling that the  ''Made In America''  tax, but you'd be hard-pressed to find it.

That's because  American companies  that import goods to the United States and  American companies  that produce goods domestically both pay the US  corporate tax rate.

The United States  does not impose any additional taxes on products that are made in America that are not imposed on imports.

In fact, many imported goods are hit with tariffs and other fees when they enter the country.

There is no  ''Made In America''  tax. So why do some in Washington want to raise taxes on consumers by a trillion dollars?

Proponents of the  tax hike  argue that because other countries have value-added taxes  [VATs]  or other consumption taxes,  American made products are at a disadvantage.

But a  VAT hits  American made exports to Japan,  for example, the same way it hits  Japanese-made products. The result is higher prices across the board for Japanese consumers, and the Americans should be thankful that they don't have the same system.

So what's the truth?

American companies are at a tax disadvantage compared with their global competitors because of their high tax rates, not because of some fictional ''Made In America''  tax.

The United States has the third highest marginal corporate income tax rate in the world, at nearly 39 percent.  Lowering that rate as much as possible is the most effective way of eliminating any disadvantage.

Further, US companies that  do business in other countries pay foreign income taxes on their profits, then get taxed again in the  United States when they bring their money back home.

That's the  real disadvantage for US companies in the global economy, they end up paying higher taxes than their foreign competitors.

'That's why my organisation supports a territorial tax system,' states the research author Mary Kate Hopkins. which has been proposed by House Ways and Means Committee and the Trump administration.

Under a territorial tax system, which is almost used by almost every other country, US companies would be taxed only on the income they earn here in the United States. 

*They would not pay taxes on the profits they earn in other countries. 

It's as simple as that; lower the corporate rate as much as possible and end our harmful system of worldwide taxation-

To allow US companies to flourish in an increasingly global economy  -without slapping a 20 percent tax on imports, adds the author*.

Punishing consumers with a  trillion dollar tax hike on imports won't  ''level the playing field''  or make  US companies more competitive. Instead, the tax will drive up the costs of doing business, leading to lower wages and inevitably higher costs for goods and products.

We have a tremendous opportunity to pass-growth tax reform. Congress can do that without imposing a new trillion-dollar tax hike on consumers.         

But in all fairness, the Short tern negatives, long term positives of the brilliant analysis and operational research that I have published above, unless you also listen to Professor Robert J Samuelson's insights. 

Using a database of occupations  [examples : farmers, nurses, engineers] developed at the  University of Minnesota, the study's authors , Robert D. Atkinson and John Wu, examined how technology affected occupations in each decade since 1850.

The more changes   -either more or fewer jobs-  the more disruptive technology's impact. There is often a cycle.

A new technology creates or eliminates jobs. The effect continues or accelerates for a few years or decades. Then the market matures, or other technological changes intrude. Jobs stabilize or decline. 

Technological change   -both gaining and losing jobs -was disruptive but, in the long run, not destructive. 

The economy's employment base adjusted. Technological changes created consumer demand for new goods and services, which sustained employment rate and offset job losses.

The great fear today, Atkinson said in an interview, is that this will change. Technology will eliminate jobs and not replace them. People worry that their ''occupational  capital [their job skills and knowledge ] will be destroyed''.

Machines will permanently substitute for people. ''That's what the debate about robots and  artificial intelligence is all about,'' he said.

But there is little precedent for this outcome. The reality, said Atkinson, is that the new technologies have always jolted job markets, individual industries and market ebb. and flow  often hurting workers and communities -but the larger process continues  -job losses in one sector are offset by job gains in another.

Consider the  1970s. During the decade, according to Atkinson,  the number of farmers dropped 12 percent, and the number of telephone operators and typists both declined by 41 percent. 

But the overall job market expanded by roughly a quarter, or about 20 million jobs.

The lesson of history seems to be this : The robots won't steal all our jobs, because their inefficiencies will create more purchasing power for other spending or new products that require human involvement and oversight.

For proof, consider smartphones.

In 2012,  they had created nearly  500,000  jobs related to  ''mobile apps'' up from  zero  in 2007.

Automation is not a new phenomenon. Understandably, it inspires fear. But so far in the  United States, it doesn't kill job growth.   

With respectful dedication to the Students, Professors and Teachers of the World. See Ya all on !WOW!   -the World Students Society and Twitter-...!E-WOW!   -the Ecosystem 2011:

''' All Positives '''

Good Night and God Bless

SAM Daily Times - the Voice of the Voiceless