Fabrications about Foreign Investment

By Bartlett, Bruce | The Washington Times (Washington, DC), April 7, 1997 | Go to article overview

Fabrications about Foreign Investment


Bartlett, Bruce, The Washington Times (Washington, DC)


On April 1, the AFL-CIO began running television and radio advertisements in 19 congressional districts supporting a $16 billion per year tax increase on U.S. multinational corporations, with the additional revenue targeted for school construction. The proposal would end the current practice of allowing U.S. firms a credit for taxes paid in foreign countries. This provision exists in order to prevent double taxation of the same income. It has been part of the tax code since 1918 and virtually every other country on Earth has the same provision in its tax law. Instead, firms would only be allowed to deduct such taxes. (Deductions reduce taxable income while credits reduce taxes directly.) The proposal would also tax all profits of foreign subsidiaries regardless of whether they are repatriated to the United States. Under current law, profits earned abroad are only subject to U.S. taxes when they are brought home.

The AFL-CIO has long been concerned about these tax provisions, because it believes they encourage U.S. firms to invest abroad; in effect exporting jobs to other countries. But as the figure shows, foreign investment does not come at the expense of domestic investment. Historically, the annual return on foreign investment well exceeds the flow of new investment. Thus foreign investment adds to U.S. income, rather than detracts from it.

Furthermore, most foreign investment simply comes out of foreign earnings. In 1995, 57 percent of U.S. foreign direct investment (FDI) came from reinvested earnings on foreign operations. And most of the rest is raised in foreign capital markets. Martin Feldstein of Harvard estimates that only about 20 percent of all U.S. FDI came from the U.S. originally. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Fabrications about Foreign Investment
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.