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Obama helping lobbyists weaken offshore banking laws


Open Left:

One of the few - and I sincerely stress the word "few" - concrete legislative successes progressives notched in the Republican Congress under President George W. Bush came on the evening of July 26th, 2002, when they humiliated the House into passing a bill sponsored by Rep. Rosa DeLauro (D-CT) banning federal contracts from going to companies that engage in tax "inversions." These are the schemes whereby a corporation that is based in the United States buys a P.O. box in Bermuda and uses it to legally avoid paying American taxes.

The bill, reported Congressional Quarterly at the time, "was expected to fail [but] when the 15-minute voting clock ran out, DeLauro's amendment was five votes ahead." Ultimately, industry-owned Republican legislators who had tried to vote down the measure realized they weren't going to be able to stop it, and "after a nod from Republican leadership, more than 100 Republicans recast their votes to give DeLauro an avalanche victory." Having witnessed this firsthand on the floor of the House, I can tell you it was indeed a sight to see.

And yet in the now-Democratic Congress seven years later, with deficits exploding and the government clearly needing to strengthen any and all incentives for corporations to pay their taxes, I was more than disheartened to read this story in the Hill newspaper this week:

Multinational corporations are fighting to preserve language in a spending bill that would weaken a ban on federal contracts.

The provision, inserted in the Senate version of the bill at the request of the Obama administration, would weaken a ban on federal contracts for inverted companies...

[...]The Obama administration is justifying its push on the grounds that the ban may - at some point in the undetermined future - conflict with our trade agreements. It's a charge North Dakota Sen. Byron Dorgan (D) rightly calls "absurd."

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