Apparently there are inversions and inversions. As you may recall an “inversion” is when a company changes its corporate headquarters in search of a lower tax liability. Recently, President Obama condemned inversions by U. S. companies:
Here’s what the president said at a press conference yesterday: “You have accountants going to some big corporations–multinational corporations but that are clearly U.S.-based and have the bulk of their operations in the United States–and these accountants are saying, you know what, we found a great loophole–if you just flip your citizenship to another country, even though it’s just a paper transaction, we think we can get you out of paying a whole bunch of taxes.”
However, Bloomberg reported a bit of irony:
President Barack Obama says U.S. corporations that adopt foreign addresses to avoid taxes are unpatriotic. His own administration helped one $20 billion American company do just that.
As part of the bailout of the auto industry in 2009, Obama’s Treasury Department authorized spending $1.7 billion of government funds to get a bankrupt Michigan parts-maker back on its feet — as a British company. While executives continue to run Delphi Automotive Plc (DLPH) from a Detroit suburb, the paper headquarters in England potentially reduces the company’s U.S. tax bill by as much as $110 million a year.
This might be a good time to recall Ralph Waldo Emerson’s dictum that a foolish consistency is the hobgoblin of little minds. Little minds are clearly not a problem for the Obama Administration.