Impotent policy proposals

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Dean Baker says tax incentives like the Patriot Employer Act can’t stem offshoring:

My reason for saying that the tax code is largely irrelevant to firms’ decisions to move jobs overseas is that any tax preferences tend to be a very small factor in location decisions. Firms ship jobs overseas because they can pay workers $1 an hour, instead of $20 an hour in the U.S. They are some quirks here and there in the tax code that can provide frosting for firms that ship jobs overseas, but there are also quirks that encourage them to keep jobs here.

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