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.”
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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.
Greed is quintessentially American. Greed is human but Americans have added 'willful ignorance' of others who share the planet with them, and thus brought Greed to a new level.
Unamerican? Unamerican? Are you kidding? You, Obama, are the only thing unamerican I can think of. You constantly fail to enforce laws passed by Congress and even signed by you. You constantl break our laws and allow your sycophants (Lerner, Holder, etc.) to perform criminal acts to which you simply pay no attention. You are the most UNAMERICAN president we have ever had. I rue the day you were elected and awaIt the day you are done away with.
What rubbish. After spending three days raising money from rich people who use every possible tax strategy to cut their taxes he calls companies that do the same thing unAmerican. Politics and hypocrisy at its finest.
"What we need is a new sense of economic patriotism, where we all rise and fall together". Funny thing, this is exactly the same economic philosphy the Nazis followed. Companies should be working for the betterment of the Fatherland and any company not doing so should be punished or controlled until they show proper support for the Fatherland.
Now all Obama needs is some goose stepping by his most loyal supporters.
If tax "avoidance" is bad, do we need to eliminate all the deductions for those of us who choose to have kids or a mortgage, etc...?
When a corporation moves it's headquarters overseas it DOES renounce it's corporate citizenship. We need to make the US more favorable to companies (like other countries do) so they will star OR EVEN set up shop here.
This president needs to stop living in the here and now (for party votes or his personal legacy) and see the greater picture for our future.
The love of other people's money is the root of all liberals.
I want to see where Obama keeps his money. Income Tax is a legal robbery. It always have been. I am surprised masses don't rise up.
Hey Obama prosecute them, or change the law. As far as I know these corporations are following the law.
How is BO to speak of anything American. He is the most unamerican to ever hold office. Hes just using his shame game again. Its his MO.
Wll Mr. President, can you blame them? I'm not saying some could have other intentions for doing what they've done, but I guess if we made things easier for them they might not leave. It's a business move, nothing personal. Oddly though, when I think of an individual doing it, it seems a little selfish.
"Did you know that the US is the only country that taxes US citizens living in another country and paying taxes there as well?"
Wrong. France imposes a Wealth Tax on all French Citizens. You must pay a percentage of your wealth (wealth being the value of all the assets you hold anywhere in the world) to France each year. The amount is small, from 0.2% to 1%. But it's also why France has seen some of it's wealthiest citizens in recent years renouncing citizenship.
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!
No one is going to give you anything. Wake up! maybe you should blame yourself for your failures and shortcomings. Greed and envy are ugly.
Taxing so called "American" companies is long overdue. The Bush era law that allowed this to happen should have never been enacted.
when these companies are gone who will you work for? tax everyone, but you huh. what do you contribute to society?
It is un-American to have a tax system that is designed to allow politicians to choose winners and losers in the economy.
I agree with the President! If folks want to reduce their taxes, then we need to reduce the federal programs requiring the most revenues. Welfare is only 20%. The large ones would be Defense, Intel, and Homeland Security (65% of total budget). We can start by reducing each by 20% in year one, and 10% a year for three years – for a 50% reduction in just four years. That should appeal to the tea baggers. The resulting budget for these three would still be larger than the combined next 24 developed nations. Combined. Take back their salaries and throw out the House Republicans – the do-nothings!
President Hypocrisy is speaking from experience.
How about a tax code that favors companies staying in the country instead of leaving? These companies have a duty to their shareholders to make as much money as they can. Or are the rich people Obama hits up at his fundraisers turning down profits in the name of patriotism? It's absurd.
The only thing in my book that is un-American is calling someone un-American, or a traitor, or treasonous, or Hitler-like, simply because you disagree politically with them. Taking advantage of a tax loop-hole? Really? Goes both ways, Barack, Rand, Marco, Harry, Hillary, etc., etc. All it accomplishes is making it easier to avoid doing the heavy lifting of ironing out differences, and makes for an even more un-civil civic arena. We are American; we are better than this.
Democrats help enact these laws. Maybe the empty chair should ask them why??
There are nearly 12 million undocumented workers in the US. Most of them are working off the books and under the table for Republican businesses, sweat shops, orchards and farms. This is why the Republican Chamber of Commerce is opposed to Immigration Reform.
The President modeled the Affordable Care Act on Mitt Romney's Massachusetts Insurance plan which was crafter for Romney by the Conservative Heritage Foundation. Its key provision is using for profit private insurance companies.
This is the plan Republicans now call socialistic.
The Venture Capitalists at Bain Capital owned by Mitt Romney. established the paradigm, followed by many other Republicans to buy American manufacturing companies, strip them of their assets, cheat their workers out of their severance pays and pension benefits and then sell the corporations to the Chinese who used them as the basis to take over the American Industrial base. Many of these same Republican Capitalists are using overseas tax shelters to evade American taxes.
All in all, it is pretty obvious that the love of money shared by most Republicans has made them choose their personal wealth over the well being of their country. They would sell your soul for a dime.
These Republicans, are indeed, un American. In the words of Pope Francis. The Republican economic policies are " selfish, greedy and they do not work." It is time to vote these worshippers of Mammon out of office and stop their corporate overseas tax dodges.
"American-based firms that use legal loopholes to avoid paying U.S. taxes have effectively renounced any allegiance to their home country" You said it correctly, loopholes. How about the 47% who do not pay any Fed Tax, are they un-american? Why is a federal worker getting his insurance subsidize and not in the social security system? Why does a single person gets taxed more than a married couple who both work and do not have children; is their cost of living cheaper? Its all about greed and jealousy. 'Tax the rich but leave me alone attitude'; what are you going to do when there's no more rich
The president is correct. Everyone should pay taxes- and in fact most everyone does, whether that is on gas or ding dongs at 7/11, or on their income or property. The greater questions really revolve around who should pay how much and should anyone pay nothing. And this is where the political parties diverge.
The Right some how sees privilege as a means of escaping taxation. Rather than pay back the nation that made their wealth possible, the Right wishes to lather the rich with tax cuts (they certainly don't need to survive), and give corporations a free pass despite the greatest profitability in decades, while shifting all the burden to the poor and middle classes- the majority of Americans who actually need growth and assistance.
Beyond this though is a far greater perversion, or distancing from reality. The Rights seems to think that not paying taxes is "freedom" (well, and it might be for their rich sponsors), but they fail to grasp that government cannot operate for free. They whine about the poor job they perceive the VA does, but they won't pay for it. They whine about infrastructure and highways- but they won't pay for it.
Their sort of hunger games mentality may work for TV, but not so much in the real world. It is no surprise Mr. Ryan's proposal contains a degree of privatization- after all someone should profit from helping the poor, right?
"Any one may so arrange his affairs that his taxes shall be as low as possible; he is not bound to choose that pattern which will best pay the Treasury; there is not even a patriotic duty to increase one's taxes."
- Judge Learned Hand
Republicans use corporate loop holes to evade taxes. Close the loop holes.
The POTUS is always blaming someone else instead of trying to find a solution to a problem. I thought he was intelligent
enough to work through difficulities. He's shown us what he's really like.