How would Obama affect Ireland if elected?

The Raven.

With all the support here for Obama as best candidate for the presidency of America, I don’t see any specific mention of what effect Obama would have on Ireland, unless I’ve missed it. According to his nomination-acceptance speech to the Democratic National Convention in Denver, he states the following:

Obama: Unlike John McCain, I will stop giving tax breaks to corporations that ship jobs overseas, and I will start giving them to companies that create good jobs right here in America.

http://www.irishtimes.com/newspaper/breaking/2008/0829/breaking6.htm

Obama last month in Lorain, Ohio: We can end tax breaks for companies that ship our jobs overseas and give those breaks to companies that create good jobs with decent wages here in America. Obama said

http://www.usatoday.com/money/perfi/taxes/2008-03-20-corporate-tax-offshoring_N.htm

And just in case we missed that, he said again last night:

Obama: What I do is I close corporate loopholes, stop providing tax cuts to corporations that are shipping jobs overseas so that we're giving tax breaks to companies that are investing here in the United States.

These statements indicate clearly to me that he intends to remove tax incentives to encourage American companies to pull out of Ireland and move back to the US. If this happened it would have serious consequences for the Irish economy, which has benefited so much from these companies over the past decade. I find this a cause for concern.

David McWilliams: Close to 80 per cent of Irish exports come from US multinationals and, for those who doubt the significance of the US in Ireland, consider the following: the combined output in Ireland of Dell, Microsoft and Intel amounts to 20 per cent of Irish GDP.

http://archives.tcm.ie/businesspost/2008/08/24/story35335.asp

McCain responded, in last night's presidential debate, by saying he would ‘cut that business tax’ to keep businesses in the US. However, he didn’t seem as committed to this particular cause.

Craft25

well at the end of the day whichever one is better able to steer the US economy in an upward direction will be doing ireland a favour, as our economy is so dependent on them...

companys are multinational now and i cant really see that trend reversing, certainly not in the long term outlook..

Overheal

Either way. Both Obama and McCain want to increase incentive for Companies to stop shipping jobs overseas. McCain wants the "Hatchet" approach by cutting the Corporation taxes from 30-odd to closer to Ireland's 11 percent (how much closer? anyone?) and Obama wants to take his "Scalpel" approach by only giving tax breaks to companies that hire americans. Either way, you may see American multinationals tone down their overseas prescence a bit. But a better american economy would still benefit europe in the same ways it always has.

The Raven.

I see McCain has mentioned it elswhere. He wants to cut the tax from 35% to 25%. It's not that close to 11%.

banquo

'Reliable sources' (Obama during the 1st debate) say that there are so many loopholes in corporate tax law that companies end up only paying around 11% tax anyway, and so the reduction down to 25% would mean that it would be cheaper for multinationals to work in, say, Florida, which is lovely, compared to, say, Sligo, which is horrible.

The Raven.

Less chance of a hurricane or tsunami in Leixlip though :cool::D!!

Black Swan

There are financial and regulatory advantages for US corporations to have divisions in EU nations such as Ireland. I doubt that either candidate will affect Irish divisions of US corporations. On the other hand, the current US recession may force some US corporations to downsize, laying off Irish workers, or even closing divisions in Ireland.

Shannon as a US military staging point may eventually be canceled if Obama is elected, and he goes through Middle Eastern withdrawal of troops. If McCain is elected, Shannon may continue as a staging point, if not with increased activity as a result of the expansion of the US military involvement in the Middle East.

faceman

American multinationals trade in markets other than the US so basing their operations in the US alone is unfeasable. The statements from them seem standard BS pre election comments

Hobbes

Shipping jobs overseas only reall caters to the items made overseas that are probably being sold back in the USA.

For services that require to be overseas (eg. Selling ipods to Europe) it works out cheaper for that company to do it in Europe.

With the $ really bad at the moment, the most profit is to be made outside of the USA.

If it happens what you are likely to see is US companies either passing those monetary hits onto the consumer or the companies moving their operations elsewhere (depending on if they are a McCain or Obama supporter).

Last and more likely is that a seperate company will be set up outside of the USA that will sell the parts and the USA company only hires US employees and no external company to make anything. They get the tax breaks and still make the items off shore.

End of the day companies motivation is profits.

Otacon

Blue_Lagoon wrote: »

Shannon as a US military staging point may eventually be canceled if Obama is elected, and he goes through Middle Eastern withdrawal of troops. If McCain is elected, Shannon may continue as a staging point, if not with increased activity as a result of the expansion of the US military involvement in the Middle East.

Will they not still need Shannon for Afganistan?

ChocolateSauce

I think relations would normalise between Ireland and the US. Right now we have a special and privileged relationship; Obama will end this and treat us just like any other ally. McCain has said he will give the Irish special treatment.

Sand

McCain has said he will give the Irish special treatment.

Uh oh...

Black Swan

Otacon wrote: »

Will they not still need Shannon for Afganistan?

Yes, if Obama follows through with his campaign promises, he will first withdraw from Iraq, refocus on Afghanistan, shifting troops and resources, but eventually will also withdraw from there (then Shannon will lose the US military as a staging point).

ChocolateSause: Have you ever been in Chicago during St Pat's Day? They dye the river green (I mean really green!), they have a huge parade down the Miracle Mile, then drink from dusk to dawn, especially on Rush Street (where it's hard to drive for the numbers of people overflowing into the street). Everyone claims Irish ancestry, running about with badges saying "Kiss Me! I'm Irish!" The point I am making is that Obama is not stupid and knows this, as he is also aware of St Pat's Day being on the US calendar, almost making it a national holiday. Even in California, all the markets stock up before St Pat's Day with Irish whiskey and cream, and many of their restaurants put Irish dishes on their menus. I've found that it's very popular to be Irish in the US, and it will continue to be so.

irish_bob

Blue_Lagoon wrote: »

Yes, if Obama follows through with his campaign promises, he will first withdraw from Iraq, refocus on Afghanistan, shifting troops and resources, but eventually will also withdraw from there (then Shannon will lose the US military as a staging point).

ChocolateSause: Have you ever been in Chicago during St Pat's Day? They dye the river green (I mean really green!), they have a huge parade down the Miracle Mile, then drink from dusk to dawn, especially on Rush Street (where it's hard to drive for the numbers of people overflowing into the street). Everyone claims Irish ancestry, running about with badges saying "Kiss Me! I'm Irish!" The point I am making is that Obama is not stupid and knows this, as he is also aware of St Pat's Day being on the US calendar, almost making it a national holiday. Even in California, all the markets stock up before St Pat's Day with Irish whiskey and cream, and many of their restaurants put Irish dishes on their menus. I've found that it's very popular to be Irish in the US, and it will continue to be so.

sounds like you didnt read the letter from that french lady in the sindo last week

Overheal

Sand wrote: »

Uh oh...

tbh it wasnt a bad thing when the clintons did it. or was it?

Sand

I was just joking the McCain=Bush=Evil line of thought.

Overheal

oh I thought you were going for that whole moronic tourist looking for leprachauns and families full of redheads line.

The Raven.

Be careful of what you wish for. I don’t know if any of you were watching last week’s Questions and Answers on RTE. There were some interesting comments on the problems facing the Irish economy depending on the result of the US presidential elections.

http://www.rte.ie/news/2008/1013/qanda_av.html?2435503,null,230

Hobbes

looking at Irish shares (eg. Bank of Ireland 10 -> 2 euros) I think the tax fear from the OP is the least of our worries.

Trojan

Standard Irish corporation tax is 12.5%. There are some exceptions:

Rates of Corporation Tax:

* 12.5%: Trading income (see Guidance on Revenue Opinions on the Classification Of Activities as Trading)
* 25%: Non-trading income [includes income chargeable under Case III (e.g. discounts, interest, foreign income), Case IV (patent royalties, miscellaneous income) & Case V (rental income from land & buildings in the State) of Schedule D]. Also included at this rate is income from activities which consist of working minerals, petroleum activities & dealing in or developing land, other than construction operations.
* 10%: Certain companies have their profits taxed at an effective rate of 10%. This 'manufacturing rate' is in the process of being phased out but remains in existence for some companies until 2010.

Source: http://www.revenue.ie/index.htm?/revguide/corporationtax.htm