Already, foreign companies, unlike U.S. companies, are not taxed by their home governments on oil they produce outside their home country. If the U.S. follows Mr. Obama's prescription, even more exploration and development abroad will move to competitors like BP and Royal Dutch Shell. U.S. imports from non-U.S. owned corporations will rise, and future U.S. tax revenues will be smaller and budget problems worse.
Similarly, all U.S. businesses can receive some tax credit for domestically based production and employment. The president wants that taken from oil companies -- who are also refiners and manufacturers and undertake considerable R&D. Follow that Rx, and future domestic production, employment and tax revenues will be smaller and budget problems worse.
On health care, many items Republicans are pushing merely shift costs to state governments and private insurers, who must raise taxes or premiums -- encouraging more offshore production, fewer jobs and less tax revenues, and worsening future budget woes.
The pricing system -- and signals prices give to consumers about health care choices -- along with bureaucratic costs, the patent system and torts burdens are widely out of control. Germany, Holland and the U.S. have private insurance systems, though government reimbursements are about 80% in Germany and Holland and only 55% here. Those competitors spend 12% of GDP on health care -- the U.S. about 19%.Germany's per capita drug costs are $400 per year, while in the U.S. those are $800. That filters through to the cost of doing business -- whether through taxes or insurance premiums. No small wonder why Germany doesn't have nearly the problem competing in global markets the U.S. does. Little being bandied by Republican budget cutters will fix that. Habitually Republicans say, "Who will pay for the R&D?" More accurate to ask, "Who will pay for unproductive tweaks in drug formulas to extend patents and big TV ad budgets to discourage use of generics?"