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Corporations Avoiding Taxes Should Not Get Security Contracts

Nov. 18, 2002

Corporations Avoiding Taxes Should Not Get Security Contracts

Statement by Public Citizen President Joan Claybrook

There’s something cynical and incongruous about setting up a Department of Homeland Security to protect Americans from terrorism and then letting that department contract with corporations that have demonstrated their lack of patriotism by moving offshore for the sole purpose of avoiding paying their fair share of U.S. taxes. Yet that’s what the White House and Republican leaders in Congress are trying to do by adding a last-minute provision to the legislation that passed the House last week and is now being taken up by the Senate.

This past summer, both the House and Senate approved language (sponsored by the late Sen. Paul Wellstone, D-Minn., and Rep. Rosa DeLauro, D-Conn.) prohibiting companies that move their headquarters to offshore tax havens from getting homeland security contracts. Then last week, as part of a package of goodies for their campaign contributors, Republicans put a provision that guts that prohibition in the final House-passed version. This is politics at its worst.

In the past several years we have seen the worst corporate abuses in a century, and Congress enabled much of the corporate wrongdoing by cutting funding for the regulatory agencies and severely weakening consumer protections. It’s time for President Bush and Congress to take a firm stand and tell corporations that if they want to enjoy the fruits of the U.S. economy and all the rights and privileges that come with being an American company, then they must pull their own weight by paying their taxes. If corporations want to get U.S. contracts to protect Americans from terrorism, then they should shoulder their responsibilities, just as American citizens do.