Obama offers populist message on corporate taxes at end of fundraising trip
July 24th, 2014
06:25 PM ET
5 years ago

Obama offers populist message on corporate taxes at end of fundraising trip

Los Angeles (CNN) – Ramping up his populist economic message as midterm elections near, President Barack Obama on Thursday singled out large companies that maneuver through legal loopholes to avoid paying U.S. taxes as “corporate deserters.”

Those firms have effectively renounced any allegiance to their home country, Obama claimed during remarks at a community college here.

“You shouldn't get to call yourself an American company only when you want a handout from American taxpayers,” he said later, calling the practice, known as “inversion,” unpatriotic.

“I don’t care if it’s legal,” he said. “It’s wrong.”

Obama was touching on an issue Thursday that Democrats believe could help them win over voters in this year's midterm contests. The President has long decried the inherent unfairness in large, multimillion dollar corporations that operate chiefly in the United States but pay little in U.S. taxes. He used the issue to attack Republican Mitt Romney during the 2012 presidential campaign.

On Thursday he heightened his anger at the firms who take advantage of the legal practice, which officials say has led to $17 billion in revenue slip through the government’s fingers.

“You are just gaming the system,” he said of inverted companies during an interview with CNBC. “You are an American company, you continue to benefit in all kinds of ways from being an American company. It is true that there may be a lot of things that may be legal that probably aren't the right thing to do by the country.”

In the past decade, at least 47 U.S. companies have made the move to incorporate in nations with low corporate tax rates. Several inversions have been proposed this year and more are in the works.

Both Republicans and Democrats say the entire tax code needs an overhaul, but Obama is pressing lawmakers to take action now to prevent inversions. Administration officials say such a measure must retroactively bar any firm that moved abroad after May 2014 from enjoying lower tax liabilities.

They say such an inclusion would prevent a rush on inversions as a new law makes its way through Congress.

The White House has aimed this week to advance the President's economic agenda, focusing on jobs programs and the economy. Bolstering the middle class has formed much of Obama's midterm election year pitch, and Thursday’s event took on the air of a campaign rally, complete with an angry protester calling Obama the Antichrist.

But world events – including Israel's ground invasion of Gaza and furor over the downed airliner in Ukraine – have largely overshadowed the intended topics this week, despite the White House's attempts to highlight new job training measures.

Obama's remarks Thursday, which were delivered at a technical college in downtown Los Angeles, came at the end of a three-day fundraising swing that also brought him to Seattle and the Silicon Valley. The event was the only public showing for Obama during his stay on the West Coast.

He withstood some criticism for not canceling the trip, which aides countered by saying the President could conduct his job from anywhere. The White House did, however, nix an appearance on "Jimmy Kimmel Live," replacing the late night show with the more sober CNBC interview.

CNN Money's Jeanne Sahadi contributed to this report.


Filed under: Democrats • Economy • Jack Lew • President Obama • Republicans • Taxes • Treasury • Treasury Department • White House
soundoff (323 Responses)
  1. Marie MD

    This has been going on for years. That is why CEOs and people like the twit are swimming in money while the middle class and their pensions pay for their money.
    Corporations are not people and the old farts on the SCOTUS need to change their decision on this, and, so many other horrible decisions they have made due to their own wealth and religion and just plain being catholics!

    July 24, 2014 06:12 am at 6:12 am |
  2. fakkkeeee

    he is ABSOLUTELY SCARED the American people will unite in boycotting American taxes

    they would be powerless

    July 24, 2014 06:57 am at 6:57 am |
  3. hkirwin

    If the corporate tax laws were not one of the highest in the world we wouldn't have this issue. If the min wage and union labor rates were not one of the highest in the world we wouldn't have this problem either. You can't have the highest tax and labor rates and expect businesses to survive and grow.

    July 24, 2014 07:05 am at 7:05 am |
  4. TomInRochNY

    Taxing so called "American" companies is long overdue. The Bush era law that allowed this to happen should have never been enacted.

    July 24, 2014 07:11 am at 7:11 am |
  5. Gurgyl

    -just give incentive to these hiring full time, with all benefits, inside USA. Fill the gap of these loopholes.

    July 24, 2014 07:14 am at 7:14 am |
  6. Nancy Pill-Owe-Me

    Yet this Community Organizer:
    – Wants $4 Billion for Illegal Immigrant Assistance programs
    – Wants Amnesty for millions of Illegal Inmigrants who blatantly broke US Law

    Is Obama pushing for Hypocrite of the Year to match his Liar of the Year Award?

    July 24, 2014 07:23 am at 7:23 am |
  7. deernibbling atdawn

    If the terms in the U.S. are untenable, companies will move their offices overseas. And should.
    Outsourcing is just capital, fleeing oppression.

    July 24, 2014 07:29 am at 7:29 am |
  8. ge

    don.t call it taxes ,do like the communist do to American companies call it fees

    July 24, 2014 07:40 am at 7:40 am |
  9. g

    treat them like what they are foreign companys .

    July 24, 2014 07:45 am at 7:45 am |
  10. ge

    they have declared themselves foreign companies and should not receive federal contracts or money

    July 24, 2014 07:58 am at 7:58 am |
  11. Rick McDaniel

    Oh really............is that what Geithner was doing, when he hadn't payed HIS taxes??????

    Obama is a total fraud.........why anyone would believe a word this man utters is beyond me. America is a country of fools.

    July 24, 2014 08:03 am at 8:03 am |
  12. Tony

    Republicans will say that they are against taking away tax breaks for corporations, because that amounts to tax increases, and corporations are people too.. Of course, Republicans have no objection taking away tax breaks for people buying insurance on the exchanges, because those people don't count.

    July 24, 2014 08:20 am at 8:20 am |
  13. rick

    Great idea. And start leveling jail terms for those who employ illegal imagrants. Minimums like 1 year in prison. Hefty fines. When the welfare system refuses to support them.. Might then get the message of go back..

    July 24, 2014 08:24 am at 8:24 am |
  14. southerngent

    " Both Republicans and Democrats say the entire tax code needs an overhaul, but Obama is pressing lawmakers to take action now to prevent so-called "inversions," which allow U.S. companies to merge with foreign firms in countries with lower tax rates."

    This is so far from voter concern it will have little impact on a voter's choice. The real issues are this administration's attack on American freedom and weakness in domestic and foreign leadership. This is no more than another attempt to divert attention to Obamas colossal failure as President.

    July 24, 2014 08:29 am at 8:29 am |
  15. Joe Jimminiy

    ROFL! Considering the source....

    July 24, 2014 08:38 am at 8:38 am |
  16. Rudy NYC

    You know the quote. I'll paraphrase it. "Give unto Caesar that which is Caesar's." Jesus even told them that they would by hypocrites to use religion as an excuse not pay their taxes. We have lots of "patriots" walking around this country who would prefer not to pay any taxes. Hypocrites, all of them.

    July 24, 2014 08:38 am at 8:38 am |
  17. DC Johnny

    Obama uses propaganda tactics to drive a wedge between American citizens under the guise that one set of law-abiding citizens is behaving illegitimately...

    ... It must be an – well would you look at that – an election year.

    July 24, 2014 08:39 am at 8:39 am |
  18. Justin

    Congress wrote the rules. Don't like the rules, change them. That's like saying clipping coupons in un-American. Watch yourself, Mr. Obama. You're blind ideology and ignorance is showing.

    July 24, 2014 08:41 am at 8:41 am |
  19. Name JK. SFL. THE GOP HOWDEE GOWDEE SHOW with special guest ISSA the CLOWN

    These TAX a CHEAT companies should be STRIPED of their citizenship AND TAXED on ANYTHING they try to send back into OUR COUNTRY. Of coarse this is just another GOP SPONSERED by the GOP to starve the goverment of tax revenue. The GOP is more SUBVERSIVE then the NAZIS!!!!!

    July 24, 2014 08:42 am at 8:42 am |
  20. Chad

    Yes, because America doesn't have its roots in renouncing citizenship for over/unjust taxation... (sarcasm)

    July 24, 2014 08:44 am at 8:44 am |
  21. Mason

    NO, giving Foreign Aid (Tax Dollars) to countries that violate our Borders is the same thing King Obama! <--

    July 24, 2014 08:44 am at 8:44 am |
  22. CapeCod

    Does he mean Joe Manchin's daughter's firm whose moving to The Netherlands?

    She's the CEO of Mylan...

    July 24, 2014 08:45 am at 8:45 am |
  23. greg

    It might be nice if the US Government offered up a new solution to companies to stay in America rather than denouncing them as traitors. Our tax structure is one of the highest in the world. Why would a company want to stay here? There are some good reasons. But financially, it makes sense to consider other options outside the US. The Government needs to step up to this challenge rather than hide behind tired, old rhetoric.

    July 24, 2014 08:45 am at 8:45 am |
  24. danicalifornia

    No Obama, you are unAmerican.

    July 24, 2014 08:45 am at 8:45 am |
  25. Pd

    No different from Obama's beloved film star 1% buddies shooting films in Canada because they are cheaper

    July 24, 2014 08:46 am at 8:46 am |
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