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About East Oregonian : E.O. (Pendleton, OR) 1888-current | View Entire Issue (Sept. 16, 2017)
Page 8A BUSINESS East Oregonian Saturday, September 16, 2017 Doubts arise on whether corporate tax cut would boost growth By JOSH BOAK AP Economics Writer WASHINGTON — For President Donald Trump, what’s good for General Motors is great for American workers. Same for Boeing. And AT&T. Not to mention small businesses. Trump insists that slashing the corporate tax rate from 35 percent to as low as 15 percent would free up valuable cash. Companies would use the money to boost investment, increase employees’ pay, accelerate hiring and speed economic growth. What’s more, corporations that now keep trillions overseas to avoid U.S. taxes would bring the money home. American companies could better compete with rivals based in countries with lower tax rates. “We’re going to have magnif- icent growth,” Trump declared aboard Air Force One on Thursday. “We’re going to go like a rocket ship.” Would we? Many economists, tax experts and even some business owners say it’s unlikely. Rather than hire, companies might use much of their tax savings to buy back their stock or increase their dividends to AP Photo/Evan Vucci President Donald Trump talks with reporters after landing on Air Force One, in Fort Myers, Fla., on Thursday. investors. Many companies, they note, have already been able to borrow at historically low rates to expand their businesses yet have chosen not to. “The mainstream economic evidence is that the bulk of corpo- rate tax cuts go exactly to whom you would expect — which is wealthy investors and executives,” said Chye-Ching Huang, deputy BRIEFLY Baker Boyer promotes bank official WALLA WALLA — Karen Benge was recently promoted to the vice president and asset management operations manager at Baker Boyer Bank. Benge graduated with a bachelor’s degree from Washington State University in 2010. She began her career with Baker Boyer Jan. 30, 2013, as an investment associate for the trust department. She was promoted to assistant investment operations manager in December 2014, advancing to manager in May 2015, and then as an assistant vice president in May 2016. Established in 1869, Baker Boyer Benge Bank continues to grow and build on strong community ties. In addition to locations in Washington, the bank has a branch in Milton- Freewater. For more information, visit www.bakerboyer.com. Bus tour cruises into Port of Morrow BOARDMAN — Highlighting one of Oregon’s largest ports, the Boardman Chamber of Commerce is hosting its annual Port of Morrow Bus Tour. Participants can learn about various businesses that are located at the port, information about the infrastructure, and developments and plans for the future at the Port of Morrow. The event is Wednesday, Sept. 20 with boarding beginning at 11:55 a.m. at the port’s Riverfront Center, 2 Marine Drive, Boardman. Due to limited seating, people must RSVP. In addition, a box lunch is available from C&D Drive-In. The cost is $12. For more information or to RSVP, contact 541-481-3014 or info@boardmanchamber.org. director of federal tax policy at the left-leaning Center on Budget and Policy Priorities. Many economists foresee some benefits from overhauling and simplifying the corporate tax code, just not the extreme growth Trump is promising. One reason corporate tax cuts might provide little overall benefit is the relative health of today’s economy. Unemployment is already unusually low at 4.4 percent. The economy is in the ninth year of a slow but steady expansion, rather than in a downturn in which tax cuts might deliver a major boost. In a 2014 paper, two econo- mists — Alexander Ljungqvist of New York University and Michael Smolyansky of the Federal Reserve — concluded that state corporate tax cuts did little to strengthen economic activity unless the cuts were made during a recession. (The flip side is that they found corporate tax increases to be “uniformly harmful.”) Nor have previous efforts to reduce corporate taxes generally delivered as advertised. Kansas, for example, exempted hundreds of thousands of businesses from corporate taxes and cut individual rates in 2012, only to face a revenue squeeze as the intended economic growth never materialized. The federal government provided a tax “holiday” on over- seas profits in 2004 to bring money back into the United States at a discount to the 35 percent rate. But the Obama administration observed later that the move had diminished tax revenue and unintentionally led companies to hoard cash abroad in hopes of receiving that discount. There is also concern that a corporate tax cut would swell the federal budget deficit. When the nonpartisan Tax Policy Center published an analysis this week, it found that even if virtually all tax breaks were eliminated, the corporate rate could drop only to 26 percent without increasing the deficit. Still, many companies stress that lower business taxes would lead to more hiring. John Stephens, AT&T’s chief financial officer, said his company faces a typical tax rate of 34 percent — including federal, state, foreign and deferred taxes — in any given year. Stephens estimates that lower rates would lead the company to immediately invest more money in its phone network, which he said would lead to more hiring by companies that work with AT&T. “When we buy more equipment, our vendors hire more,” Stephens said. “When we build more exten- sive networks, we have people — hard-hat jobs — building those networks.” Key Equifax executives departing after huge data breach By KEN SWEET AP Business Writer NEW YORK — Equifax announced late Friday that its chief information officer and chief security officer would leave the company immediately, following the enormous breach of 143 million Americans’ personal informa- tion. It also presented a litany of security efforts it made after noticing suspicious network traffic in July. The credit data company said that Susan Mauldin, who had been the top security officer, and David Webb, the chief technology officer, are retiring from Equifax. Mauldin, a college music major, had come under media scrutiny for her qualifications in security. Equifax did not say in its statement what retirement packages the execu- tives would receive. Mauldin is being replaced by Russ Ayers, an information technology executive inside Equifax. Webb is being replaced by Mark Rohrwasser, who most recently was in charge of Equifax’s international technology operations. Equifax has been under intense public pressure since it disclosed last week that hackers accessed or stole the millions of Social Security numbers, birthdates and other information. On Friday it gave its most detailed timeline of the breach yet, saying it noticed suspicious network traffic on July 29 associated with its U.S. online dispute portal web application. Equifax said it believes the access occurred from May 13 through July 30. Equifax had said earlier that it identified a weakness in an open-source software package called Apache Struts as the technological crack that allowed hackers to heist the data from the massive database maintained primarily for lenders. That disclosure, made late Wednesday, cast the company’s damaging security lapse in an even harsher light. The software problem was detected in March and a recommended software patch was released shortly afterward. Equifax said its security officials were “aware of this vulnerability at that time, and took efforts to identify and to patch any vulnerable systems in the company’s IT infrastructure.” The company said it hired Mandiant, a business often brought in to deal with major technology security problems at big companies, to do a forensic review. Equifax has been castigated for how it has handled the breach, which it did not disclose publicly for weeks after discovering it. Consumers calling the number Equifax set up initially complained of jammed phone lines and uninformed representatives, and initial responses from the website gave inconsistent responses. The company says it has addressed many of those problems. Equifax also said Friday it would continue to allow people to place credit freezes on their reports without a fee through November 21. Originally the company offered fee-free credit freezes for 30 days after the incident. Equifax is facing a myriad of inves- tigations and class-action lawsuits for this breach, including Congressional investigations, queries by the Federal Trade Commission and the Consumer Financial Protection Bureau, as well as several state attorneys general. The company’s CEO Richard Smith is scheduled to testify in front of Congress in early October. Three Equifax executives — not the ones who are departing — sold shares worth a combined $1.8 million just a few days after the company discovered the breach, according to documents filed with securities regulators. Equifax shares have lost a third of their value since it announced the breach. Heppner chamber lunch features agricultural program update HEPPNER — Larry Lutcher will provide an update on the Morrow County Agricultural Program during the upcoming Heppner Chamber of Commerce meeting. The no-host luncheon is Thursday, Sept. 21 at noon at Heppner City Hall, 111 N. Main St. Catered by Tacos Hometown, the meal is $10. Those planning to attend need to RSVP by Tuesday and designate a choice between a chicken or beef burrito, which will be served with chips and salsa and a cookie. In addition, Heppner is hosting the sixth annual Blue Mountain Century Scenic Bikeway Ride this weekend. The chamber encourages the public to welcome visitors to the community. For more information or to RSVP for the lunch, contact 541-676-5536 or heppnerchamber@centurytel.net. ENERGY SAVINGS ARE IN YOUR FUTURE Fairway Independent Mortgage opens new branch in Hermiston HERMISTON — Hermiston now has its own branch of Fairway Independent Mortgage Corporation. The newly-renovated office at 308 E. Gladys Ave. is still being touched up, but is open for business with loan officers Kim Arbogast and Meghan Golden. Arbogast started her career in the industry in 1996 with Bank of Eastern Oregon, then started Hometown Mortgage Group in 2009. She and business partner Melissa Webb decided to split up their business and Arbogast opened the Fairway office. She said she was excited to make a change. “It’s a good move,” she said. Arbogast and her husband Ty Arbogast raised their four daughters in Heppner before moving to Hermiston in 2011. Fairway Independent Mortgage Corporation has funded more than $50 billion in home mortgage loans since it opened more than 20 years ago, according to the company’s website, and acts as an advisor to would-be homebuyers through the finance process. It offers adjustable-rate, conventional, FHA, fixed-rate, jumbo, refinance, renovation, reverse mortgage, USDA and VA mortgage options. The office is open from 9 a.m. to 5 p.m. Monday through Friday. Medical Aesthetic Appointments THREE WAYS YOU CAN COMMAND YOUR HOME ENERGY DESTINY LIGHTING ELECTRONICS HEATING Install ENERGY STAR® LED bulbs to cut your energy use by as much as 85 percent. LEDs are available in many styles to fit all the rooms in your home and you’ll save even more in the long run because they’ll last up to 20 times longer than standard bulbs. Unplug battery chargers for mobile phones, tablets, laptops and other devices when not in use—they use energy even when they’re not actively charging anything. Group your electronics together on power strips so you can switch them off when you’re done using everything. Save on heating costs by lowering the thermostat to 65-68 degrees when you’re home, and to 58-60 degrees at night or when you’re away. Upgrade to a smart thermostat to make these kinds of energy-saving changes automatically. Botox • Fillers • Kybella • IPL • Ultherapy available with Dr. Marcea Wiggins at Exhale Day Spa • Joseph, OR. September 28th & 29th Call 971.407.3066 to schedule for a complimentary consultation, a specific service or with questions. Visit Santepdx.com to learn more about Dr. Wiggins and the service she offers! + Get more from your energy. Call us at 1.866.368.7878 or visit www.energytrust.org/homes. Serving customers of Portland General Electric, Pacific Power, NW Natural, Cascade Natural Gas and Avista.
