INSOURCING THE OUTSOURCERS’ CASH
Billionaire Obama, Democratic donor made fortune outsourcing
Qualcomm founder Irwin Jacobs / AP
One of the largest donors to the pro-Obama Super PAC Priorities USA is the founder and former CEO of a company that pioneered the practice of shipping work overseas.
Dr. Irwin Jacobs, who founded the telecommunications firm Qualcomm in 1985 and served as chairman and CEO until March 2009, gave $2 million to Priorities USA in June, according to the Center for Responsive Politics.
He has also given $100,000 to American Bridge 21st Century, the left-wing research operation funded by billionaire financier George Soros.
Jacobs has personally donated more than $370,000 to Democratic candidates and committees since 2007, including nearly $12,000 to President Obama.
His net worth is estimated at almost $2 billion.
His son Paul, who is also a prominent supporter of the Democratic Party, succeeded Jacobs as CEO. Paul has donated more than $62,000 to Democratic candidates and committees since 2007, including $5,000 to Obama.
Qualcomm has enjoyed substantial success over the past several years while it has dramatically expanded its operations overseas.
The company’s profits jumped from $1.6 billion in 2009 to $4.3 billion in 2011, an increase of nearly 300 percent.
During that same period, the San Diego-based firm increased its number of properties owned or leased outside the United States from 70 to 99, according to documents filed with the Securities and Exchange Commission. During that time, the company pared down its U.S. property holdings from 76 to 73.
Qualcomm announced in 2011 that it planned to invest $1 billion to build a massive manufacturing facility in Taiwan. The move was unsurprising, given that the company generates most of its revenue overseas, particularly from sales in South East Asia.
Like a number of U.S.-based corporations, Qualcomm has substantial cash holdings in offshore accounts. As of 2012, the company had about $16.5 billion in offshore cash.
President Obama has accused his Republican challenger Mitt Romney of promoting the “outsourcing” of American jobs and wanting to “give tax breaks to companies who are shipping jobs overseas.”
“I’m a big proponent of insourcing,” the president said at a fundraiser in Oakland on Monday. “I want to end these tax breaks and start rewarding companies that create jobs right here in Oakland, right here in the United States, making products that we sell around the world, stamped with three proud words: Made in America.”
The Obama campaign did not respond to requests for comment.
Qualcomm supports a largely Republican effort to allow U.S.-based corporations to reinvest their foreign cash back home, an effort the president has opposed.
GOP lawmakers have been calling for a temporary tax break for businesses that reinvest foreign-earned assets in the United States, which they say will provide a much-needed boost for the sluggish economic recovery. This so-called “repatriation tax holiday” could add nearly 3 million jobs to the economy, according to a study by the U.S. Chamber of Commerce.
Prominent Democrats such as Bill Clinton and Rahm Emanuel have also backed the concept of a tax holiday.
Paul Jacobs of Qualcomm has said it “could be a great stimulus.” William Bold, the company’s senior vice president of government affairs, has criticized Democrats for “clinging to misguided arguments” against the proposal.
“The point is, repatriation is no longer an imperative for corporations such as ours,” he wrote on the company’s website. “Without a dramatically reduced tax rate … repatriation simply will not happen. Much of the nearly $1 trillion held by American companies will sit offshore, or be invested in foreign ventures. How is that scenario a win for American taxpayers?”
Many blame the reluctance of corporations to repatriate their offshore assets on the U.S. corporate tax rate, which is the highest in the world. House Republicans have proposed lowering the rate on repatriated profits from 35 percent to as low as 5.25 percent.
The Obama administration, however, has opposed the Republican effort, saying it would only consider the issue of repatriation in the context of comprehensive tax reform.
The president has not seriously engaged Congress on the issue of tax reform since taking office.
Republicans cite the president’s failure to do so as one of several examples of how his policies have “shipped the recovery overseas.”
Obama’s own record of outsourcing is extensive. His Department of Energy, through its clean energy loans program, has awarded billions of dollars in taxpayer financing to foreign-owned companies and firms that manufacture their products overseas.
As the Free Beacon reported in June, the Obama administration is using prison labor to assemble solar panels manufactured in Taiwan, despite claiming the panels are “domestically sourced and produced.”
The Obama campaign also has contracts with foreign telemarketing firms.
The Jacobs are joined by a host of other prominent Obama donors engaged in the practice of shipping work outside the country.
Lawmakers were shocked to learn earlier this month that the United States’ Olympic team uniforms were made in China. Ralph Lauren, who heads the company that made the uniforms, has given $7,300 to Obama and more than $35,000 to Democratic National Committee (DNC) since 2008.
DNC communications director Brad Woodhouse did not return a request for comment.
http://freebeacon.com/insourcing-the-outsourcers-cash/
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