MSNBC’s Stephanie Ruhle and Ali Velshi smacked down a Republican congressman’s claims that lower corporate taxes would usher in higher wages.
Rep. Jim Renacci (R-OH), who serves on the House Ways and Means Committee, insisted the GOP tax overhaul would inspire corporations to pay their workers more — but the co-hosts of “Velshi & Ruhle” challenged to cite any example of that happening.
“Economists will tell you the first effect of high taxes is to the wages, is to the shareholder, so the corporations don’t have the ability to pay higher wages,” Renacci said. “So the question is, we could disagree all day on this. The question is, if I had a lower tax rate as a business guy for 30 years, would I raise wages? Absolutely.”
“But the record doesn’t support that’s true,” Velshi said.
Ruhle said U.S. companies move jobs overseas because labor was cheaper, and would continue to be cheaper, so tax cuts would have little effect the job market and wages.
“See, and I disagree with that,” Renacci said. “When I talk (to business leaders) why factories are leaving, they do it because of simply trade and getting ability to move — it’s not labor.”
Ruhle pointed out the tax bill would not change any trade agreements, and President Donald Trump had pulled out of the Trans-Pacific Partnership.
“It doesn’t mean that ‘Laverne and Shirley’ are ever getting their jobs back at the bottle factory,” Ruhle said. “Companies with more money can then take it and invest in robotics. We don’t know that that forgotten American is ever going back to work.”
Renacci, who’s running for governor of Ohio, argued that Trump had encouraged companies to bring jobs back to the U.S. — and Velshi pounced.
“In Wisconsin, he announced Foxconn,” Velshi said. “Foxconn said in 2013 it was going to Pennsylvania (but), as I always say when I bring this up, anybody from Harrisburg, tweet me if you have any evidence of a Foxconn factory.”
“By the way Foxconn, which makes these phones, does it with robots,” Velshi added. “They can relocate anywhere in the world, they can go to the highest wage place in the world because it’s robots.”