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George explains why the GOP tax bill only benefits large corporations

When the president promises, “...a huge tax cut for Christmas...a great, big, beautiful Christmas present.” let's be clear about one thing. Regardless of what he says, he's not talking to the average taxpayer, or the small business owner. He's talking to Corporate America.

We've all heard the words before. Tax breaks for corporations and the wealthy will pay for themselves, by stimulating economic growth. Tax breaks for corporations and the wealthy will create jobs which will create greater demand for labor and result in higher wages for the average American. Everybody wins. The biggest problem with that? There's no evidence that it's true. Furthermore, even if it were true, there's no evidence that it applies to the current economy.

Are corporations struggling under an onerous tax burden? Of course they're not. Yes, the top statutory tax rate for corporations is nearly forty percent. Were that the actual rate, an argument could be made for corporate tax relief. But, the effective rate – what corporations are actually paying, after deductions, loopholes, subsidies and tax credits – is less than half the statutory rate; about nineteen percent.

Is the economy struggling due to corporate taxation? Not by any conventional measure. The Dow Jones average has reached a record high 180 times in the past five years. Inflation is low. Interest rates are low. We are at or near full employment – after accounting for average turnover, seasonal jobs, and mismatches between worker skills and job requirements. Corporations are awash in cash.

Corporations recorded record profits every year from 2010 to 2014. Even with slight declines the past two years, corporate profits still exceeded every year prior to 2014. Non-financial corporations currently have over $1.9 trillion in cash reserves – nearly double what they held a decade ago. If conventional GOP wisdom is correct; that prosperity trickles down; that flush corporations will flood the economy with jobs, pushing wages higher and unleashing unprecedented economic growth, why isn't that already happening? How much more incentive do they require?

Small businesses, which account for over two million Pennsylvania jobs (40 percent of all jobs in the state), and 90 percent of Pennsylvania's exports, need a tax break. Their mega-corporation counterparts do not.

As your representative in Congress, I will work with anyone on either side of the aisle who is interested in genuine tax reform that simplifies the corporate tax code; reduces the top statutory corporate tax rate without ballooning deficits and exploding the debt; and targets tax relief on our small business owners, who need it most, and not huge, multi-national corporations that are already sitting on $2 trillion they can't figure out how to use.

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