Just before heading home, Senate Democrats are making a last-ditch push for an anti-outsourcing jobs bill that has little chance of passing. The bill would provide a two-year break in payroll taxes for every new employee hired to replace one overseas, but it doesn’t look like it’s going anywhere. Even Finance Committee chairman Max Baucus has voiced concerns that it would put the US at a competitive disadvantage. When the bill is put to a procedural vote this morning, it seems likely to get shot down.
Democrats orchestrated the vote to show sympathy with voters who believe American jobs are being lost because U.S. companies are outsourcing them overseas. Democrats trying to score on sluggish economy issue, as they fight to maintain majorities in both the House and Senate.
The bill would exempt companies that import jobs from paying the 6.2 percent Social Security payroll tax for new U.S. employees who replace overseas workers who had been doing similar work.
The two-year exemption would be available for workers hired over the next three years. The tax cut — estimated to cost about $1 billion — would be partially offset by tax increases on companies that move jobs overseas.
The bill would prohibit firms from taking deductions for business expenses associated with expanding operations in other countries. It would increase taxes on U.S. companies that close domestic operations and expand foreign ones to import products to the U.S.
The tax increases total $369 million over the next decade, according to a preliminary estimate by the nonpartisan Joint Committee on Taxation. Combined with the tax cut, the bill would add an estimated $721 million to the budget deficit over the next decade.
