US trade deficit is largely a fiction created by corporate tax evasion.
Workers for companies like Apple create incredibly value software that is shipped around the world, but the value of that work doesn't show up in our export numbers because Apple and other companies don't want to pay taxes on the revenues. Instead:
"if you buy an iPhone in Europe or Asia, the intellectual-property rights contained in your phone actually belong to Apple subsidiaries in Ireland … Apple charges those subsidiaries relatively little for the rights to this intellectual property, yet allows them to collect most of the money Apple makes from selling the phone. In 2011 the Irish subsidiaries…collected two-thirds of Apples worldwide pretax income...
As a result of this transfer pricing structure described in the Senate report, technically speaking, Apple doesn’t export very many “design” or “software” services. The relatively low price it charges to its offshore subsidiary reduces service exports in the balance of payments while inflating the income line in the balance of payments."
And now Trump will use that supposed trade deficit to justify massive tax cuts for businesses to help them "bring production home" to the U.S. So first taxpayers lost when these companies evaded taxes in the first place, and now they will lose a second time as the fiction of the trade deficit is used to slash taxes for the wealthy again.
You must realize the main reason Apple produces and keeps the funds overseas is because of the incredibly high corporate tax rates in the US. Apple has hundreds of billions of dollars abroad that could and should be spent in the US. That is a very significant amount. Both Democrats and Republicans agree it will be a very good thing for America if the trillions of dollars "stuck" overseas can be brought back to the US.
Whether you like Trump or not, his actions to reduce the corporate tax rate will bring back trillions of dollars to the US, create thousands of more jobs, fund new businesses, increase wages, increase profits and grow the economy like it hasn't grown in decades. The numbers don't lie.
People don't understand, the so called "wealthy" are the companies and successful people that create jobs, start new ventures and grow the economy for everyone's benefit. Punishing them with higher and higher taxes has not proven to help. It has forced them to leave and resulted in higher unemployment, decreasing wages and slower economic growth.
Again, there is nothing to argue here. Only one thing works and the numbers don't lie. Have a look at the economy, stock market, employment numbers, wage growth etc. All have increased in this Administration. Like them or not, clearly they are doing something right.
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