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Obama attacks Romney on exported jobs, Swiss bank accounts

May 01, 2012|By Jon Healey
  • The latest anti-Mitt Romney ad by President Obama's reelection campaign focuses on Romney's record on offshore commerce as well as his former Swiss bank account.
The latest anti-Mitt Romney ad by President Obama's reelection campaign… (YouTube.com and BarackObama.com )

Hot on the heels of its idiotic attempt to use the Osama bin Laden killing as fodder for an attack ad on Mitt Romney, the campaign to reelect President Obama started running ads Tuesday criticizing Romney for outsourcing jobs and having a Swiss bank account. It's a step forward in one respect: At least now the Obama campaign isn't taking Romney's comments out of context.

The ostensible purpose of the ad was to defend Obama's energy policies against "over the top" criticism from "Big Oil" -- a reference to an ad by Americans for Prosperity that contends $2.3 billion worth of clean-energy tax credits in the 2009 economic stimulus bill went to companies in China, Mexico and Finland.  Americans for Prosperity was founded by GOP financier David Koch of Koch Industries, an energy and raw-materials powerhouse, hence the "Big Oil" connection.

Rather than trying to defend the tax credits, Obama's team devotes most of its ad to Romney's record as a takeover specialist at Bain Capital, where he allegedly "shipped American jobs to places like Mexico and China," and as governor of Massachusetts, when he "outsourced state jobs to a call center in India." And now as a candidate, the ad laments, Romney is "still pushing tax breaks for companies that ship jobs overseas."

COMMENTARY AND ANALYSIS: Presidential Election 2012

"It's just what you'd expect from a guy who had a Swiss bank account," the ad concludes.

Oh, where to begin....

Romney's record at Bain is completely fair game, especially if he continues to stress the number of jobs created by the companies Bain purchased. Because several of Bain's targets went the other direction as they restructured, shedding jobs or shifting them overseas.

But the issue worth debating isn't Bain's employment practices. It's whether federal tax policy should be changed to discourage companies from hiring people outside the United States. Even if you think the answer is yes, it's no simple matter to do so without hindering U.S. companies' efforts to compete in fast-growing offshore markets or encouraging them to move their headquarters overseas.

The "call center in India" line refers to Massachusetts' practice of having workers in India take calls from state welfare recipients seeking help during Romney's tenure. The policy question worth debating is whether state contracts for such services should go to the lowest bidder, or should the money be spent in-state regardless of the cost. If you applied the latter principle to every state expenditure, imagine how much more tax revenue would be required to pay the bills.

Finally, the ad criticizes Romney for proposing a new approach to corporate income taxes, one that looks at profits made just in the United States. Such a "territorial" approach happens to be the one used in almost every other developed country. Today the United States taxes multinational companies on all the profits they make globally, but does not collect the tax on foreign earnings until they are brought back into the United States. This system may discourage companies from putting assets and jobs in low-tax foreign lands simply for the sake of cutting their tax bills, but it isn't an effective deterrent. Instead, it makes it harder for companies to take the profits they make in expanding foreign markets and reinvest them in their U.S. operations.

Again, that's a tax policy issue worth debating, rather than reducing it to a sinister-sounding line in an attack ad.

The Swiss bank account is likely to be a recurring theme of the campaign, with the "just what you'd expect" jab being a likely tag line in many an attack ad. For the Obama campaign, it's just another way to get across the accusation that Romney's wealth makes him incapable of relating to the average voter.

Never mind that Romney put most of his investments into blind trusts in 2003, before he took office as Massachusetts' governor, so he may not have played any role in the choice to park some of his funds into a discreet Swiss vault. But if the blind-trust argument doesn't work for Romney, he can hold himself partly responsible: When running against Sen. Edward M. Kennedy in 1994, Romney said, "The blind trust is an age-old ruse." Add that sentence to the long list of things Romney has reconsidered in the fullness of time.


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