McCain, Hagan Introduce Plan To Bring Foreign Earnings Home

By Adrianna McGinley

At a news conference Thursday, Senators John McCain (R-Ariz.) and Kay Hagan (D-N.C.) introduced the Foreign Earnings Reinvestment Act, which would temporarily reduce the corporate tax rate in an effort to incentivize U.S. corporations that bring foreign earnings back to the U.S.

The bill proposes temporarily reducing the current 35 percent tax rate to 8.75 percent, and it could go as low as 5.25 percent for companies that use the repatriated money to create jobs at home. The bill would also penalize companies that lay off workers after participating in the program.

McCain emphasized it is a bipartisan proposal that needs to be passed immediately, citing it would introduce 50 to 80 billion dollars of tax revenue into the treasury and create two million jobs.

“Frankly, I don’t understand why anyone would be in opposition to a proposal that would bring $1.4 trillion back to this country to invest in jobs and create jobs and help the economy,” McCain said.

The two acknowledged though that the proposal is only meant as a temporary fix, and long term tax reform is necessary.

“The Foreign Earnings Reinvestment Act is not the only solution to our economic crisis. Unfortunately there is no single silver bullet, but that is no reason for inaction. We need practical bipartisan action to get our economy growing and growing now,” Hagan said.

The duo plans to introduce the bill as an amendment to the president’s jobs bill.

Gates, Clinton Say No Secret Negotiations Taking Place On START

By Sarah Mamula
Talk Radio News Service

Though U.S. President Barack Obama and Russian President Dimitry Medvedev signed the new Strategic Arms Reduction Treaty (START) in Prague this past April, Congress has to yet to ratify.

Appearing before the Senate Armed Services Committee on Thursday, U.S. Secretary of State Hillary Rodham Clinton defended START, saying it will limit strategic offensive arms in both the U.S. and Russia in order to ensure stability and predictability between the two nations that together, possess 90% of the world’s nuclear weapons.

Despite bipartisan enthusiasm for ratification, Ranking Member John McCain (R-Ariz.) said he has concerns over the potential constraints in missile defense due to the inclusion of Article 5, as well as a unilateral statement made by Russia at the time of the signing that stated Russia would only validate START if the U.S. halted its defense missile build-up.

“That is a strong statement at the time of the signing,” said McCain.

Clinton, however, downplayed its significance, telling the committee, “We are not bound by it. In fact, we’ve issued our own statement making clear that the United States intends to continue improving and deploying effective missile defense systems.”

Secretary of Defense Robert M. Gates, who also testified, agreed with Clinton’s view that neither Article 5 nor Russia's statement would affect U.S. missile defense capabilities.

According to Gates, the new START retains U.S. power to maintain, modernize and deploy “the most effective missile defenses possible.”

When questioned about a recent press report claiming that secret negotiations regarding restrictions on defense missiles were occurring, Clinton defended the transparency of the U.S.-Russia negotiations on the treaty.

“There is no secret deal,” she stressed. “There is no plan to limit U.S. missile defenses in this treaty.”