More 1984 Speak

American Jobs Creation Act – another misnomer in our 1984 world. Last Fall the Congress passed this law which, one would think, would have some specific clauses that attempted to fulfill the title of the act. Think again.

The law allows companies to bring to the US the profits they have sitting in foreign accounts and as a motivator to do so enables the companies to pay a tax of 5 ¼% on these profits instead of the more typical 35%. Since there is about $320 billion sitting in these foreign accounts, the savings for these companies amounts to almost $100 billion, or slightly more than was asked for to cover our adventures in Afghanistan and Iraq for the next several months.

To obtain these savings the companies have to approve a ‘domestic reinvestment plan’ spelling out what they intend to do with this gift. Among the more common uses: buy companies, brand building, pay down debt, pay legal liabilities. Do you see ‘job creation’ listed?