The head of the nation’s largest manufacturing association says it is “extraordinarily cowardly” for politicians to go after companies seeking tax benefits outside the United States.
Democratic presidential candidate Hillary Clinton recently released a video criticizing Johnson Controls for moving its headquarters to Ireland as part of a merger with Tyco International. The deal will save the combined company an estimated $150 million in taxes. Clinton said the company sought a bailout for the auto industry during the recession and is now leaving the country.
“I think that when a politician chooses to do that, it is extraordinarily cowardly,” said Jay Timmons, National Association of Manufacturers president and chief executive officer, in an interview with BizTimes Milwaukee.
Timmons noted Clinton is not the only politician to go after Johnson Controls and both Republicans and Democrats have criticized companies for similar moves.
“I think it telegraphs loudly and clearly that they’re not serious about ensuring America’s greatness in the world and they’re not willing to take on the difficult task of focusing on America’s competitive advantage,” Timmons said.
He was in Milwaukee for the Wisconsin Manufactures & Commerce Focus on Manufacturing breakfast where he was the keynote speaker.
“Companies have to invest where the cost of doing business makes them competitive,” Timmons said, noting that a company like Johnson Controls has a responsibility to its shareholders. “To do otherwise would be professional malpractice.”
He said that progress has been made in attracting people to careers in manufacturing, but there is more work to do. He said decisions by companies to move jobs to Mexico or overseas do present a challenge for the industry.
“It is certainly a perception issue that we battle and its one that can be overcome pretty easily if we enact the right public policy choices at the national level,” Timmons said. “Why are national leaders forcing business leaders to make these agonizing decisions that I guarantee you they don’t want to make?”
He highlighted tax structure, infrastructure, regulatory environment and trade agreements as areas where the country needs to make policy changes.
“It’s really sad that we haven’t figured out that while we have a lot of great things going for us, we’re taking for granted the fact that we are the preeminent economic power in the world and if we don’t act pretty quickly, we’re not going to be for long,” Timmons said.
