Alliance of Americans for America

The Failure of Congress to Pass ‘Bring Our Jobs Home Act’

Should our government offer tax incentives to U.S. Corporations who relocate or re-shore their business and jobs back home? And should we also deny tax deductions to U.S. Corporations who outsource their jobs overseas?

A bill titled “The Bring Jobs Home Act” would do just that, but the debate and vote by both the Senate and House in Washington, D.C. has stalled it since 2012, when the bill was first introduced by Michigan Sen. Debbie Stabenow. The bill was filibustered to death in the Senate, with 44 Republicans voting not to bring the bill to the Senate for debate and a vote.

The Bring Jobs Home Act has returned to the Senate for a vote this year. The bill would provide tax breaks and a 20 percent tax credit to corporations that bring jobs back to the U.S. and will end tax deductions for the cost of building plants and moving machinery and operations overseas.

The first vote in the Senate to allow the bill to the floor passed by a vote of 93-7. This uber-majority vote to let it out of committee bodes well for a “yes” vote on what we see as a very simple and necessary piece of legislation that is long overdue.

The Senate is expected to vote on the legislation sometime this week. The next hurdle will be in the House of Representatives, where the Republican majority, led by Speaker of the House John Boehner, will allow a vote. Sources we have spoken to in DC say any vote is still unclear, with passage less likely.

The issue of bringing jobs back home to America should not be a partisan issue, with Democrats voting in favor and republicans opposed, said Bring Our Jobs Home founder Frank Spotorno.
“Admirers of globalization contend that free access to foreign markets and cheap labor increase corporate profits and thereby benefit the U.S. economy,” he said. “While this argument may superficially sound compelling, it ignores the dangerous long-term effects of manufacturing losses. In reality, outsourcing makes Americans poorer over time, because America's wealth and technology slowly migrate to other nations.

“America's wealth grew when profits from domestic manufacturing were reinvested into buildings, machinery and technological change. But now outsourcing is diverting that income to foreigners. America may gain access to cheaper products through outsourcing, but it also comes with problems, including a downward pressure on wages.

“If America does not manufacture and sell goods, then money only leaves the country,” continued Spotorno. “The U.S. now imports twice as much as it exports. This has resulted in a trade deficit that has ballooned to an unprecedented $800 billion on an annualized basis. Unfortunately, this trend shows no signs of abating. U.S. exports are declining versus imports all across the board. Even agriculture posted a deficit this past year for the first time in living memory.

“God Bless Sen. Stabenow and Sen. Walsh for all you are doing to bring these jobs home, end poverty in America, better education for our children, passing the Affordable Care Act, better high-quality paying jobs, better nutrition and giving hope to our next generation, our future leaders, our children!

“Tell Congress to bring jobs home! Please email your senators today and ask that they ‘Bring Jobs Home’ by supporting this legislation,” said Spotorno. “At a time when the nation’s unemployment rate is still too high, why are we rewarding companies for shipping our jobs out of the country? It doesn’t make any sense! These companies shouldn’t be rewarded any longer.”
One of the Senate sponsors of the Bring Jobs Home Act is Senator John Walsh from Montana.
“This is commonsense legislation that can have a direct impact on growing our economy,” said Walsh. “The Senate took a bipartisan step to create jobs in America and end an incentive in the tax code for outsourcing that has hurt so many working families. I hope this important bill won't get caught in the partisan politics that has brought down so many important bills this year.”

“It protects American jobs and encourages future job creation within our borders,” added Senate Majority Leader Harry Reid.

The Bring Jobs Home Act has the support of New York’s two U.S. senators, Charles Schumer and Kirsten Gillibrand.

“We should be doing everything in our power to encourage job growth at home and discourage companies from shipping good-paying New York jobs abroad,” said Schumer, a sponsor of the bill. “Unfortunately, our current tax code includes incentives that make outsourcing a much more attractive option for companies than it should be. With our economy finally beginning to recover after years of uncertainty, it is time to bring jobs back to New York that many companies sent abroad during the downturn and to institute wholesale changes that make it less likely for jobs to be outsourced again. I always fight tooth and nail for every single job in New York, and I am pushing for this tax change because I know it will lead to more ‘We Are Hiring’ signs cropping up across the state.”

According to a 2013 survey by The Boston Consulting Group, 54 percent of American manufacturers with sales greater than $1 billion who produce goods in China were planning to bring production back to the U.S. This figure represents a sharp increase from Boston Consulting Group’s 2012 survey, which indicated that only 37 percent of manufacturing companies were considering bringing production and jobs back to the U.S. from China.

Schumer said this clearly shows there is real interest in bringing jobs back, which is why a tax change is needed to get these companies to follow through on their plans. He noted that over the past few years, many large manufacturers – including New York’s own General Electric, as well as many smaller manufacturers – have announced that they are bringing jobs back to the U.S. and New York from places like Japan, Mexico and China.

The argument against the Bring Jobs Home Act is that it will complicate our tax code, and not provide the incentives to corporations to relocate jobs home.

We disagree. This is the first step of a long journey; it is a modest bill that doesn’t address the more serious issues of unfair trade agreements for the U.S.

More on this issue next week, when the Senate votes and the House decides what to do. We plan on providing the name of every senator and representative, and their votes on this critical issue, in the weeks to come.

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