IBM is lobbying against a bill even though it would extend a favorite bipartisan policy, the federal tax credit for R&D.
IBM and other business lobbies oppose the bill because of provisions that would increase taxes on money earned overseas by U.S. companies, but the Wall Street Journal’s editorial on it the debate is worth reading for some interesting undercurrents.
First, it’s great to see the Journal call out the R&D tax credit as corporate welfare, which it is. Politicians in both parties like the measure, and obviously so does the business lobby. If you oppose the tax credit, you just hate R&D or something.
But second, the Journal explains why the credit is not permanent:
If Congress really believed R&D was a priority, it could make the credit—which expired in December, the 13th time it has done so since it started in 1981—permanent. But that would make it harder to string out corporate bidders for more PAC contributions, as well as depriving Members of the annual fire drill that gives them a chance to boost taxes.
Back in the days of Gray Davis, California operatives would tell me about “milk bills” — legislation the governor would openly hem and haw about in order to raise funds from both the side that would get rich off the bill, and the side that would suffer. On these pages, I’ve written of how Charlie Rangel plays donors, and Chuck Schumer, too. The WSJ has just identified another milk provision.