Here’s a letter to the Wall Street Journal:
You report that Hillary Clinton tried to explain (away) her recent ‘businesses don’t create jobs’ remark by saying that what she really meant is that jobs are not created by businesses that “outsource jobs or stash their profits overseas” (“Hillary Rodham Warren,” Oct. 31).
Ignore Ms. Clinton’s outsourcing comment, which reflects nothing but pedestrian economic illiteracy (or her willingness to pander to such). Instead, note that if Ms. Clinton is correct to suggest that corporations are stashing lots of profits overseas, Thomas Piketty and his fans ought to be pleased. Profits that are stashed abroad (or anywhere, for that matter) are not – contrary to M. Piketty’s suspicions – paid out frivolously and unfairly to undeserving CEOs; are not ploughed back into profit-making activities that further widen wealth disparities by increasing the value of capital assets; are not spent to finance the conspicuous consumption that M. Piketty and many on the left worry ignites envy in the 99 percent; and are not used to buy the political favors and electoral outcomes that “Progressives” fret are now being bought by the 1 percent.
So the downside of jobs potentially lost to the stashing of profits might be balanced, or even outweighed, by the upside of these stashed profits not being invested and spent in all those socially corrosive ways that M. Piketty so famously warns against.
Donald J. Boudreaux
Professor of Economics
Martha and Nelson Getchell Chair for the Study of Free Market Capitalism at the Mercatus Center
George Mason University
Fairfax, VA 22030