Take The Money And Run

In a stunning rebuke of trickle-down economic theory, the following news-item was the headline story in the April 7, 2011 Business pages of the Metro National newspaper, as reported by The Canadian Press news service. In a landmark study, "Companies that reaped the most benefit from massive tax reductions over the past decade underperformed on job creation, the Canadian Centre For Policy Alternatives says. That finding appears to undermine the Conservatives' rationale for corporate tax cuts. The Ottawa think-tank tracked the job-creation record of almost 200 of Canada's leading companies, from 2000 to 2009. During that period, those companies reported a 50% increase in profits, while paying 20% less in taxes. But from 2005 to 2010, employment creation at those companies was 16% lower than the national average. Conservatives and right-wing economists have long argued that reducing corporate taxes will make Canadian firms more competitive and create more jobs. But based on the evidence, the CCPA study concluded that the firms benefitting most from corporate tax reductions created fewer jobs, not more, pocketing the tax reductions instead."